JSE set to benefit from Asia and US rally
The JSE will open to a rush of green from Asian markets on Wednesday after US markets rallied for a second day in a row.
The Nikkei in Japan gained 0.32%, the Hang Seng in Hong Kong surged by 5.47% while the Shanghai composite remained closed for China’s Golden Week holiday.
The rise from Hong Kong came in part because of pent-up deals after its markets were closed on Tuesday for a public holiday.
The Hang Seng and the Nikkei were also buoyed by Wall Street’s rally as investors anticipate that the US Federal Reserve will slow down the pace of interest rate hikes after weaker-than-expected economic data. The Nasdaq ended 3.34% higher on Tuesday, followed by the S&P 500 with 3.06% and the Dow Jones 2.80%.
Meanwhile, market sentiment was also boosted by Reuters reporting that Chinese refiners were likely to boost refined oil products exports in November and December and into the start of 2023 after receiving the biggest allocation from Beijing this year.
Year to date, the Nikkei is down 7.55%, the Hang Seng 22.61% and the Shanghai composite 16.74%.
The Nasdaq is down 29.41% since the start of 2022, the S&P 500 20.97% and the Dow Jones 17.13%.
Tencent, which influences the JSE via Naspers, jumped 5.53% on Wednesday morning.
In local markets, the JSE rallied in line with global equities markets for a second day on Tuesday, gaining the most in two months as investors sought to shake off a brutal September when the market hit the lowest level in 2022r. The all share ended 3.25% firmer at 66,312 points and the top 40 gained 3.44%.
The dollar strengthened somewhat on Wednesday morning, but the rand was well below the R18/$ mark breached last week. The dollar ticked up 0.12% to R17.66/$.
“The dollar’s significant move lower since making a new 20+ year high last Wednesday is an entirely logical response to the combination of smartly lower US bond yields and much improved risk sentiment following,” National Australia Bank analyst Ray Attrill said in a note on Wednesday.
It was red across the board for commodities as the price of Brent crude, gold and platinum declined. Brent crude was down 0.18% to $91.63 a barrel, gold 0.40% lower to $1,699.24/oz and platinum slid back 0.88% to $921.77.
Property news is set to dominate the local corporate headline on Wednesday with the Equites Property Fund and Newpark REIT both releasing their interim results.
The big economic news will be S&P Global releasing the September PMI for SA, which tracks business trends across the private sector including mining, manufacturing, services, construction and retail.
Source: businesslive.co.za
