Bulls n Bears Daily Market Commentary : 11 April 2018

Wed Apr 11 19:07:46 CAT 2018

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Bulls n Bears Daily Market Commentary : 11 April 2018

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Zimbabwe Stock Exchange Update

Market Turnover $1,861,553.78 with foreign buys at $1,664,883.23 and foreign
sales were $829,246.56. Total trades were 58.

The All Share index rose by 0.99 points  to settle at 89.43 points as most
heavyweight counters gained ground. ECONET  led the movers with a $0.0588 to
trade at $0.7711, DELTA   added $0.0433 to close at $1.6684 and PPC went up
by $0.0375 to $1.0000.  MEIKLES  increased by $0.0171 to end at $0.2900,
INNSCOR  gained $0.0050 to trade at $0.9750 whilst DAIRIBOARD and SIMBISA
both put on $0.0025 to settle at $0.1225 and $0.3700. 

However, BRITISH AMERICAN TOBACCO shed a significant $3.0000 to close at
$17.0000 while PADENGA eased $0.0050 to $0.4100.

 <mailto:info at bulls.co.zw> 

Global Currencies & Equity Markets

South Africa

South African rand firms as dollar hammered by Syria fears, stocks lower

(Reuters) - South Africa’s rand firmed in late trade on Wednesday as the
dollar slipped on fears of possible Western military action against Syria
and tensions between Russia and the United States soared, subduing risk
appetite.

The concerns weighed on stocks, with the benchmark index snapping two
straight sessions of gains.

At 1512 GMT, the rand traded at 11.9900 against the dollar, 0.39 percent
firmer than Tuesday’s close of 12.0375.

The rand had weakened to 12.1250/dollar earlier in the session in line with
a broader emerging markets sell-off.

But the mood subsequently turned more bearish after U.S. President Donald
Trump warned Russia of imminent military action in Syria over a suspected
poison gas attack, lambasting Moscow for standing by Syrian President Bashar
al-Assad.

The fragility of South Africa’s recent domestic economic rebound was also in
focus after data on Tuesday showed manufacturing had fallen on a
month-on-month basis in February. In addition, the Reserve Bank warned last
year’s boom in growth could fade if details on policy reforms were not
forthcoming.

On the bourse, the JSE Top-40 index fell 1 percent to 49,472 points and the
broader All-share index lost by the same margin to 56,170 points.

Lenders Barclays Africa and Standard Bank were among the biggest decliners,
both falling 3.4 percent as they started trading without the rights to their
next dividend payouts.

In fixed income, the yield for the benchmark government bond fell one basis
point to 8.095 percent. 

Uganda

Ugandan shilling seen vulnerable to losses on high liquidity

(Reuters) - The Ugandan shilling was stable on Wednesday but traders said it
was vulnerable to depreciation on the back of importer demand and abundant
local currency liquidity in the money markets.

At 0914 GMT commercial banks quoted the local currency at 3,690/3,700 , same
level as Tuesday’s close.    

China

Stocks gain as Xi calms U.S.-China trade fears; rouble tanks

LONDON, April 10 (Reuters) - Global equity markets rallied and the Japanese
yen fell on Tuesday as Chinese President Xi Jinping’s promise to cut import
tariffs eased investor concerns about an escalating U.S.-China trade row.

Russian assets extended Monday’s slide as investors digested the new round
of U.S. sanctions targeting the country’s tycoons. The rouble plunged more
than 4 percent against the dollar to its lowest since late-2016.

Speaking at the Boao Forum for Asia in Hainan province, Xi vowed to open
China’s economy further, protect intellectual property of foreign firms and
he criticised a “Cold War mentality” as obsolete, in his first public
comments since the trade dispute with U.S. President Donald Trump’s
administration erupted.

Xi’s comments prompted a largely positive reaction in financial markets,
which have been rattled over the past week on fears the tit-for-tat
U.S.-China tariffs will escalate into a full-scale trade war that would
threaten global growth.

European markets followed Asia with solid gains. Germany’s DAX rose 0.8
percent, France’s CAC 40 0.51 percent and Britain’s FTSE 100 0.59 percent.

The U.S. S&P 500 E-mini futures gained 1.15 percent, suggesting U.S. shares
would open positively.

The MSCI World Index rose 0.34 percent.

Oil markets rose sharply on hopes that the trade dispute may be resolved
without greater damage to the global economy. Brent crude futures climbed
more 2 percent to $70.12.

After trading flat for most of the day, the euro surged when European
Central Bank policymaker Ewald Nowotny told Reuters that the central bank
could stagger the process of raising euro zone interest rates by first
lifting its sub-zero deposit rate back toward positive territory.

The euro rose 0.4 percent to $1.2378 and left the dollar down across most
major currencies aside from the Japanese yen.

The yen, which traditionally rises in times of market stress, fell versus
both the dollar and euro. The dollar rose to as high as 107.245 before
giving up some of those gains.

Safe haven bond prices including 10-year Treasuries initially dropped as
risk appetite recovered.

Gold rose 0.2 percent.

The Australian dollar, which has fallen in recent weeks because of the
economy’s exposure to global trade flows, gained against the dollar, as did
Asian currencies including the Chinese yuan

“Xi explicitly did not continue the trade war rhetoric so this is going to
be risk-friendly and the market will be relieved,” said Kit Juckes, a macro
strategist at Societe Generale.

RUSSIAN FALLS

Russian financial markets sold off sharply.

The rouble tumbled 4.2 percent, bringing its losses against the dollar since
last Friday to around 10 percent.

Rouble-denominated shares rose 0.8 percent, bouncing off multi-month lows
hit on Monday when the Moscow bourse dropped 8.3 percent

The shares of Rusal, the aluminium giant, which, with its boss Oleg
Deripaska, was highlighted prominently in the sanctions, fell a further 7.5
percent in Hong Kong after slumping 50 percent on Monday.

Its dollar bonds maturing 2022 were trading at record lows around 52 cents,
having lost half their value since the sanctions were announced.

The MSCI Emerging markets index was up 0.63 percent as other larger markets
outside of Russia rallied.

For Reuters Live Markets blog on European and UK stock markets open a news
window on Reuters Eikon by pressing F9 and type in ‘Live Markets’ in the
search bar

Commodities Markets

Stocks fall, oil jumps as tensions mount in the Middle East

(Reuters) - Global equity markets slid on Wednesday as U.S. President Donald
Trump warned Russia that missiles “will be coming,” in Syria after a
suspected chemical attack, and oil hit its highest in more than three years
after Saudi Arabia said it intercepted missiles over Riyadh.

The fallout from new U.S. sanctions on Moscow have rattled investors and
fears of military action were stoked after one of Russia’s ambassadors
reiterated it would shoot down any U.S. missiles fired at Syria.

Trump, who has criticized Russia for standing by Syrian President Bashar
al-Assad, shot back in a message on Twitter early on Wednesday.

The Dow Jones Industrial Average fell 106.33 points, or 0.44 percent, to
24,301.67, the S&P 500 lost 3.53 points, or 0.13 percent, to 2,653.34 and
the Nasdaq Composite added 9.80 points, or 0.14 percent, to 7,104.10.

Facebook Inc shares were up 0.2 percent as Chief Executive Mark Zuckerberg
spoke in his second day of testimony before the U.S. Congress.

The pan-European FTSEurofirst 300 index lost 0.61 percent and MSCI’s gauge
of stocks across the globe shed 0.09 percent.

Emerging market stocks rose 0.04 percent. MSCI’s broadest index of
Asia-Pacific shares outside Japan closed 0.08 percent higher, while Japan’s
Nikkei lost 0.49 percent.

Michael James, managing director of equity trading at Wedbush Securities in
Los Angeles, said investor nerves were again rattled a day after easing on a
more conciliatory tone over trade between Trump and Chinese President Xi
Jinping. But one report said early talks had already broken down .

Meanwhile, oil prices hit their highest in more than three years after
Trump’s latest comments.

U.S. crude rose 2.43 percent to $67.10 per barrel and Brent was last at
$72.50, up 2.06 percent on the day.

Oil prices began to climb on Trump’s warning over Syria, then rallied
further on a report that Saudi Arabia’s air defense forces intercepted a
missile over the capital Riyadh.

Aluminium prices extended their rally to a sixth straight session, hitting
an 11-week peak, amid persistent worry about shortages after the U.S.
imposed sanctions on Russia’s Rusal .

The dollar fell, hitting a two-week low over lingering trade war worries
with China and domestic scandals swirling around Trump.

The dollar index fell 0.2 percent, with the euro up 0.26 percent to $1.2386.

The Russian rouble slumped as much as 2.5 percent against the dollar and
even more versus the euro.

Spot gold added 1.9 percent to $1,364.40 an ounce. U.S. gold futures gained
1.65 percent to $1,368.10 an ounce, as safe-haven demand sharpened.
Palladium, which has also benefited from expectations that sanctions on
Russia could hurt supply, rose further after climbing nearly 6 percent in
the past two days.

U.S. Treasury yields slipped after U.S. consumer price data reinforced
expectations the Federal Reserve will raise interest rates at a gradual
pace.

Benchmark 10-year notes last rose 6/32 in price to yield 2.7771 percent,
from 2.797 percent late on Tuesday. 

Gold climbs more than 1 pct as risk appetite flags

(Reuters) - Gold rose more than 1 percent on Wednesday as concerns over
escalating tensions in Syria, U.S. sanctions on Russia and the U.S.-China
trade stand-off weighed on stock markets and the dollar index. 

The metal hit a two-week high as appetite for nominally lower-risk assets
sharpened. Palladium, which has also benefited from expectations that
sanctions on Russia could hurt supply,

rose further after climbing nearly 6 percent in the past two days.  

Spot gold        was up 0.9 percent at $1,350.80 an ounce at 1330 GMT, off
an earlier peak of $1,355.21. U.S. gold futures were 0.7 percent higher
$1,354.60.

European equities fell after two days of gains as tensions over Syria and
U.S. sanctions drove Russia's rouble to a two-year low, while concerns about
the prospect of a trade war

boosted traditional safety plays at the dollar's expense.

The U.S. unit languished near a two-week low against a basket of currencies.

Gold is often perceived as a safe store of value during times of political
and financial uncertainty.  

Markets are also awaiting clues on the outlook for U.S. monetary policy from
minutes of the March meeting of the Federal Reserve's Federal Open Market
Committee (FOMC), due later on

Wednesday. Tighter monetary policy raises the opportunity cost of holding
non-yielding bullion.

Gold has been caught within a trading range between $1,300 and $1,360 since
the end of January.  

Among other precious metals, silver        was up 0.6 percent at $16.65 an
ounce, while platinum        was 0.8 percent higher at $928.49.

Palladium        was up 0.2 percent at $955.80. The metal, more than 40
percent of which is produced in Russia, has bounced strongly this week as
sanctions against Moscow fed into a

technically driven rebound after the first quarter's 10 percent slide.  

Although Russian output of the metal has not been affected directly, the
sanctions have caused enough concern over supply in a market that has been
in deficit for a decade to bring some speculative money back in, analysts
said.   

INVESTORS DIARY 2018

Company

Event

Venue

Date & Time

Zimbabwe

Independence Day

Zimbabwe

18/04/2018

Workers’ Day

01/05/2018

Africa Day

25/05/2018

Zimbabwe

Heroes’ Day

Zimbabwe

13/08/2018

Zimbabwe

Defence Forces Day

Zimbabwe

14/08/2018

DISCLAIMER: This report has been prepared by Bulls ‘n Bears, a division of
Faith Capital (Pvt) Ltd for general information purposes only and does not
constitute an offer to sell or the solicitation of an offer to buy or
subscribe for any securities. The information contained in this report has
been compiled from sources believed to be reliable, but no representation or
warranty is made or guarantee given as to its accuracy or completeness. All
opinions expressed and recommendations made are subject to change without
notice. Securities or financial instruments mentioned herein may not be
suitable for all investors. Securities of emerging and mid-size growth
companies typically involve a higher degree of risk and more volatility than
the securities of more established companies. Neither Faith Capital nor any
other member of Bulls ‘n Bears nor any other person, accepts any liability
whatsoever for any loss howsoever arising from any use of this report or its
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investigation into the business, financial condition and future prospects of
any companies referred to in this report. Other  Indices quoted herein are
for guideline purposes only and sourced from third parties.

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