JSE likely to start a new month on weaker footing

The JSE is expected to start a new month on a weaker footing, given the weak trading picture in Asia, where the benchmark stock market indices were lower, hobbled in part by rising Covid-19 cases in parts of the world.

Japan’s Nikkei 225 index shed 0.45% and Australia’s ASX/200 lost 0.47%, but China’s Shanghai Composite was relatively flat.

The JSE will likely edge lower, after losing 2.5% in June, marking its worst monthly performance since October. However, the all share is still up 12% year to date.

Rising Covid-19 cases and subsequent tighter restrictions wobbled leisure and other SA-focused stocks earlier in the week, though some of them have since recovered.

The rand was marginally weaker against the dollar, losing 0.25% to trade at R14.30/$ ahead of the US nonfarm payrolls report on Friday.

The US economy is expected to have added about 700,000 jobs in June, up from 559,000 jobs in May.

The strong US jobs figures could strengthen the dollar and put pressure on the rand, as data will back the case for a potential rise in interest rates in the US.

A potential hike could detract capital from emerging markets like SA that are perceived as risky.

Commodity prices were moderately higher, with the gold price rising 0.40% to $1,776.93/oz, while Brent crude was relatively steady at $74 a barrel. 

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Source: businesslive.co.za