JSE tracks its weaker global peers

The JSE tracked weaker global markets on Tuesday as investors awaited a swathe of earnings reports from Big Tech in the US and economic data.

Facebook’s parent company Meta, Amazon, Google and Microsoft are scheduled to publish earnings for the first quarter this week and the results will be scrutinised for the effects of higher borrowing costs and a struggling economy.

“US equity market breadth — a measure often used to gauge the direction of the overall market by comparing the number of assets advancing versus those declining — is negative, indicating that the bulk of listed companies are not performing well under current economic conditions,” RMB economists said in a note.

“Since the beginning of the year, the five tech giants’ stocks — Amazon, Google, Intel, Meta and Microsoft — have been responsible for about two-thirds of the S&P 500’s gains in 2023. Thus, the quarterly earnings reports of these five tech giants, released this week, will be of particular interest to markets.”

The JSE all share lost 0.29% to 77,891.13 points — led by industrial metals, resources, and precious metals which fell 2.26%, 1.63% and 0.96%, respectively — while the top 40 was down 0.26%.

At 6.09pm, the Dow Jones industrial average was 0.48% weaker at 33,713.58 points and the S&P 500 was down 0.89%. In Europe, London’s FTSE 100 closed 0.27% lower and France’s CAC 40 fell 0.56%, while Germany’s DAX was little changed.

Economic data due this week includes US GDP data for the first quarter, which is scheduled for publication on Friday and is likely to be pivotal for the Federal Reserve in deciding the outcome of its next policy meeting on May 2-3.

“Markets are slightly under pressure after an array of earnings releases and as investors eye further US data later in the week,” Oanda senior market analyst Edward Moya said. “We are deep into earnings season and, overall, earnings are coming in better than expected, but the consumer is weakening and very concerned about the outlook. The Fed may stay on its tightening course with the risks of a May hike still remaining on the table.”

The rand was weaker on the day, weakening 1.24% to R18.362/$ by 5.47pm. It was also softer against the euro and pound, depreciating 0.51% to R20.1449/€ and 0.59% to R22.769/£. The euro was 0.62% weaker at $1.0976.

Gold was barely changed at $1.989.14/oz, while platinum gained 0.18% to $1,083.90/oz.

Brent crude fell 2.1% to $80.57 a barrel.