Bulls n Bears Daily Market Commentary : 29 August 2018

Thu Aug 30 07:41:58 CAT 2018

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Bulls n Bears Daily Market Commentary : 29 August 2018

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Zimbabwe Stock Exchange Update

Market Turnover $3,995,572.04 with foreign buys at $316,793.62 and foreign
sales were $557,328.23. Total trades were 89.

The All Share index lost a marginal 0.01 points  to close at 115.18 points.
OK ZIMBABWE  shed $0.0042 to close at $0.2301 and MEIKLES eased $0.0032 to
end at $0.3505. ECONET  went down by $0.0015 to $1.2185 while PADENGA and
SEEDCO each lost $0.0001 to close at $0.6551 and $2.5799 respectively.

Trading in the positive; BRITISH AMERICAN TOBACCO  increased by a further
$0.2500 to close at $27.0000, OLD MUTUAL put on $0.0246 to $5.3403 while
NATIONAL FOODS gained $0.0100 to end at $5.6300. Beverage giant DELTA  was
marginally up by $0.0003 to trade at $2.1503 and TURNALL  inched up $0.0002
to settle at $0.0142. 

 <mailto:info at bulls.co.zw> 

Global Currencies & Equity Markets

Uganda

Uganda shilling steady, interbank demand pressure eyed

(Reuters) - The Uganda shilling was unchanged on Wednesday but appetite from
commercial banks looking to cover short positions was seen triggering some
pressure on the local unit, traders said.

At 0914 GMT commercial banks quoted the shilling at 3,765/3,775, unchanged
from Tuesday's close.

South Africa

South Africa's rand slides as risk sentiment wavers, stocks rise

Reuters) - South Africa’s rand retreated more than one percent on Wednesday
as global risk demand fell off with concerns about the trade row between the
U.S. and China lingering, while stocks gained slightly on the day.

At 1500 GMT the rand was 1.46 percent weaker at 14.4400 per dollar, slightly
firmer than the session-low of 14.4975.

The rand briefly traded below the 14.00 mark on Tuesday before giving back
those gains, and has since tumbled alongside other emerging markets as
investor optimism over the U.S.-Mexico trade deal faded.

Traders said month-end rebalancing by of portfolios, which often sees fund
managers and traders buying dollars to match losses by the local currency,
had added to selling pressure.

Washington and Mexico agreed on Monday to overhaul the NAFTA trade deal. But
the fact that U.S. President Donald Trump’s planned tariffs of another $200
billion on Chinese goods could take effect in late September dashed market
optimism.

Local jitters over the government’s land reform policy have also weighed on
sentiment toward the rand.

The rand rallied briefly to 13.9525 earlier after parliament withdrew an
expropriation bill passed in 2016 that allowed the state to make compulsory
purchases of land.

The thrust of the bill, which sought to make compulsory purchases of land to
redress racial disparities in ownership, has been overtaken by a proposal by
the ruling African National Congress to change the constitution to allow the
expropriation of land without compensation.

South Africa is due hold general elections in mid-2019, with land and
economic reforms seen as the main campaign issues.

Bonds weakened, with the yield on the benchmark paper due in 2026 up 6.5
basis points to 8.94 percent.

On the bourse, the all-share index strengthened 0.21 percent to 60,166
points and the Top-40 index 0.27 percent to 54,031 points, in line with
international markets continuing to benefit from subdued trade tensions.

Shares in Steinhoff rose sharply after its board said it will meet over the
next two days to discuss asset sales to boost cash flow and pay down debt.
Its stock closed 25 percent higher at 2.75 rand. 

       <mailto:info at bulls.co.zw> 

Asia

Asia stocks slip; weakness in China outweighs NAFTA trade optimism

(Reuters) - Asian stocks surrendered earlier gains and dipped on Thursday,
with Chinese markets fixed firmly on risks from the Sino-U.S. trade war and
taking little comfort from an apparent easing in business tensions in North
America and Europe.

The leaders of the United States and Canada expressed optimism on Wednesday
that NAFTA negotiations would meet a Friday deadline for a deal, days after
the U.S. and Mexico reached a bilateral agreement.

But MSCI’s broadest index of Asia-Pacific shares outside Japan dropped 0.2
percent, with broad gains across the region offset by losses in China.

The Shanghai Composite Index slid 0.8 percent and Hong Kong’s Hang Seng fell
0.7 percent.

U.S. tariffs on another $200 billion of Chinese goods are expected to take
effect later next month.

Australian stocks rose 0.1 percent. Japan’s Nikkei initially touched a
three-month high following gains on Wall Street but pared gains and was last
up a modest 0.05 percent.

South Korea’s KOSPI was 0.1 percent higher.

Major South Korean steelmakers such as POSCO and Hyundai Steel gained after
news that President Donald Trump signed a proclamation permitting targeted
relief from steel and aluminium quotas from countries including South Korea.

U.S. shares extended their rally on Wednesday, with the S&P 500 and the
Nasdaq hitting record highs for a fourth straight session as technology
stocks pushed indexes higher and promising NAFTA negotiations boosted
investor confidence.

Canada rejoined the talks to modernise the 24-year-old NAFTA after Mexico
and the United States announced a bilateral trade deal on Monday, which had
helped global equities begin the week on stronger footing.

The White House has said it wants to settle NAFTA before negotiating with
China.

The pound surged as fears of a ‘hard Brexit’ eased after the European
Union’s chief exit negotiator signalled an accommodative stance towards
London in ongoing talks.

Sterling rose to a 3-1/2-week high $1.3039, extending its gains after
surging more than 1 percent overnight.

The dollar index against a basket of six major currencies struggled near a
four-week low of 94.434 plumbed on Tuesday, weighed by the pound’s rally.

The greenback has also been on the defensive this week with safe-haven
demand for the currency diminishing in the wake of improving risk sentiment
in broader markets.

The euro was a shade lower at $1.1699 after edging up 0.1 percent the
previous day. The dollar was nearly flat at 111.62 yen after rising 0.4
percent overnight.

The Chinese yuan dipped 0.15 percent to 6.8301 per dollar in early onshore
trade on Thursday.

Investors kept a wary eye on the Turkish lira, which retreated to a two-week
trough on Wednesday after Moody’s downgraded 20 Turkish banks in a further
blow to a country already gripped by a financial crisis and stuck in a
diplomatic row with the United States.

Other struggling emerging market currencies in focus included Argentina’s
peso. The peso tumbled overnight to a record low against the dollar after
Argentine President Mauricio Macri asked the International Monetary Fund
(IMF) for early assistance, alarming investors.

The IMF said it was studying the request from Argentina to speed up
disbursement of the $50 billion loan programme.

In commodities, Brent crude futures rose 0.1 percent to $77.20 per barrel
and U.S. crude futures climbed 0.2 percent to $69.64 per barrel.

Oil contracts had risen more than 1 percent on Wednesday, supported by a
drawdown in U.S. crude and gasoline stocks and as U.S. sanctions reduced
Iranian crude shipments.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Trump allows targeted relief on steel, aluminum quotas -Commerce Department

(Reuters) - U.S. President Donald Trump has signed proclamations permitting
targeted relief from steel and aluminum quotas from some countries, the U.S.
Commerce Department said on Wednesday.

Trump, who put in place tariffs on steel and aluminum imports in March,
signed proclamations allowing relief from the quotas on steel from South
Korea, Brazil and Argentina and on aluminum from Argentina, the department
said in a statement.

Trump, citing national security concerns, placed tariffs of 25 percent on
steel imports and 10 percent on aluminum imports.

The tariffs on steel and aluminum imports from the European Union, Canada
and Mexico took effect on June 1, and Commerce Secretary Wilbur Ross said on
May 31 that arrangements had been made with some countries to have
non-tariff limits on their exports of the two metals to the United States.

Ross said the arrangement with South Korea was for a quota of 70 percent of
average steel exports to the United States in the years 2015 to 2017.

The Brazilian government said at the time the U.S. quotas and tariffs on
Brazil’s steel and aluminum exports were unjustified but that it remained
open to negotiate a solution.

Brazilian semi-finished steel exports to the United States are subject to
quotas based on the average for the three years from 2015-2017, while
finished steel products will be limited to a quota of 70 percent of the
average for those years. 

Aluminium slips from 2-month high as U.S. eases metal import quotas

(Reuters) - London aluminium prices fell for the first time in six sessions
in early Asian trade on Thursday, after U.S. President Donald Trump allowed
relief on aluminium import quotas from Argentina.

Trump, who put in place tariffs on steel and aluminium imports in March,
signed proclamations allowing relief from the quotas on steel from South
Korea, Brazil and Argentina and on

aluminium from Argentina, the U.S. Commerce Department said in a statement
on Wednesday. 

    FUNDAMENTALS

* LME ALUMINIUM: Three-month aluminium on the London Metal Exchange fell 0.7
percent to $2,157 a tonne by 0213 GMT, after jumping 1.8 percent in the
previous session. It hit a

two-month high of $2,178 on Thursday and has climbed for five straight days
on rising input costs for smelters.

SHFE ALUMINIUM: The most-traded October aluminium contract on the Shanghai
Futures Exchange fell 0.2 percent to 14,930 yuan ($2,187.55) a tonne. It
earlier rose as much as 0.5

percent towards Thursday's two-month high of 15,100 yuan.

* OTHER METALS: LME copper edged down 0.2 percent to $6,077 a tonne, while
in Shanghai copper was trading 0.6 percent lower. Shanghai lead was the
biggest gainer, rising 1.4 percent on concerns of a tightening environmental
crackdown in China.

* GRAPHIC: Copper prices have recovered from a recent rout, but the
possibility of the trade dispute between Washington and  Beijing escalating
and its potential to crimp demand in hina, the world's top consumer, is
expected to cap gains.

* CHILE: Striking workers at state-owned Codelco's Andina copper mine have
rejected their employers' latest contract offer, the company and union said
on Wednesday.

* FREEPORT: Indonesia will extend a special mining permit  for PT Freeport
Indonesia for another month to September, Energyand Mineral Resources
Minister Ignasius Jonan told reporters on Wednesday.

* ANTO: Antofagasta Plc expects its board to approve a $1.3 billion
expansion of its Los Pelambres copper mine before the end of the year with
construction starting in January, the Chilean miner's chief executive
officer said on Wednesday.

INVESTORS DIARY 2018

Company

Event

Venue

Date & Time

The Harare Agricultural Show

The Harare Agricultural Show

The Harare Agricultural Show

August 27- September 1

 <mailto:info at bulls.co.zw> 

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
contents or otherwise arising in connection therewith. Recipients of this
report shall be solely responsible for making their own independent
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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