JSE set for pressure on Wednesday as trade war fears rise

The JSE looks set to join a global sell-off of risk assets on Wednesday morning, with trade war issues again the dominant theme on global markets.

US President Donald Trump has poured cold water on hopes the world’s two largest economies are inching towards a partial deal, saying that the can may be kicked down the road until after the 2020 US elections.

The US has also threatened tariffs against France, in retaliation against a digital tax in that country.

This has served as a reality check for equity markets, said National Australia Bank analysts in a note, though this is not the first time Trump has suggested the US-China trade war issue could extend beyond next year’s elections.

Asian markets were sharply lower on Wednesday morning, in line with losses overnight in the US.

At 6.15am SA time Hong Kong’s Hang Seng was down 1.2%, while the Shanghai Composite had lost 0.34%.

Gold was up 0.15% to $1,479.20/oz, while platinum had risen 0.23% to $911.42. Brent crude was 0.46% up at $61.28 a barrel.

The rand was little changed at R14.64/$.

Tencent, which influences the JSE via its largest shareholder Naspers, was down 0.97%.

Locally, the Standard Bank purchasing managers’ index for November is due at 9.15am, amid gloom about SA’s economic prospects, after disappointing third-quarter GDP numbers on Tuesday.

Financial services group Sygnia is expected to report that headline earnings per share rose as much as 27% in its year to end-September.

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