JSE to contend with mixed Asian markets on Wednesday amid vaccine worries

The JSE faces mixed Asian markets on Wednesday morning, with a generally positive tone on global markets undermined by the concern that vaccine rollouts may be delayed due to side effects from the Johnson & Johnson Covid-19 vaccine.

The US, EU and SA have decided to temporarily halt the vaccine due to incidents of severe blood clotting. The review is expected to take a few days

The short-lived reaction in US equity futures and treasury yields on Tuesday reflects the assessment that there is an abundance of other vaccines in the US, so this hiccup will have little effect there, said National Australia Bank analyst Rodrigo Catril in a note. The same cannot be said for the EU, which is depending on about  55-million doses this quarter, he said.

SA has ordered about 31-million doses.

US markets also reacted favourably to March consumer inflation numbers from that country on Tuesday, even though inflation rose above expectations to 2.6%, a two-year high.

“The market took the stronger-than-expected inflation data in its stride, seemingly embracing the Fed rationale that the lift in prices is only likely to be transitory,” said Catril.

In morning trade, the Hang Seng was up 1.29% and the Shanghai Composite 0.15%, while Japan’s Nikkei had given back 0.51%.

Tencent, which gives direction to the JSE via the Naspers stable, had risen 1.81%.

Gold was flat at $1,743.48/oz while platinum had risen 0.71% to $1,165.51. Brent crude was 0.22% higher at $64.08 a barrel.

The rand was slightly firmer at R14.48/$, on track for its third consecutive session of gains, albeit marginal ones.

Locally, the corporate and economic calendar is somewhat busy, with retail sales data for February due at 1pm. The numbers are expected to show an improvement from January’s 3.5% year-on-year fall, a reflection of easing lockdown conditions in that month.

Aluminium producer Hulamin is expected to report later that its headline loss per share improved in its year to end-December, though this is a reflection of one-off restructuring costs and writedowns in the previous year, with sales lower in 2020 due to the pandemic.

Agriculture-focused Zeder Investments is due to release its results for the year to end-February later, though it has not released a trading update recently.

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