Bulls n Bears Daily Market Commentary : 15 January 2018

Mon Jan 15 15:13:47 CAT 2018

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Bulls n Bears Daily Market Commentary : 15 January 2018

 <http://www.firstmutualproperties.co.zw/> 

Zimbabwe Stock Exchange Update

Market Turnover $940,944.90 with foreign buys at $197,827.64 and foreign
sales were $2,243.47 . Total trades were 55 .

The All Share Index was 0.03 points  lower at 94.66 points in mixed trading.
PPC   shed $0.0500 to close at $0.8000, CBZ  eased $0.0190 to $0.0810 and
PADENGA  was down by $0.0029 to end at $0.4975. EDGARS  lost $0.0020 to
trade at $0.0450 while FIRST MUTUAL HOLDINGS   and INNSCOR  were each
$0.0002 weaker at $0.1948 and $0.8500 respectively.  

Trading in the positive territory; MEIKLES   rose by $0.0178 to close at
$0.3170, TSL LIMITED   put on $0.0100 to $0.4500 while OLD MUTUAL   closed
at $4.8540 after gaining $0.0099. DELTA   shifted up by $0.0042 to end at
$1.5612 while AXIA  and DAIRIBOARD  each inched up by $0.0005 to trade at
$0.1805 and $0.1105 respectively. 

 <mailto:info at bulls.co.zw> 

Global Currencies & Equity Markets

Uganda

Ugandan shilling stable as tax payments offer support

(Reuters) - The Ugandan shilling        remained unchanged on Monday, helped
by flat dollar demand as mid-month tax payments forced most firms to stay
out of the market.

At 0911 GMT commercial banks quoted the shilling at 3,640/3,650, the same
level as Friday's close.

Kenya

Kenyan shilling stable, oil and retail demand seen posing risk

(Reuters) - The Kenyan shilling was stable against the dollar on Monday,
with increased buying activity from retail and oil importers seen posing a
depreciation risk.

At 1028 GMT, commercial banks quoted the shilling at 102.95/103.05 per
dollar, the same as Friday's close.

Europe

Euro hits 3-year high as Europe leads global optimism

(Reuters) - The euro hit a fresh three-year high on Monday as optimism
around growth buoys expectations of tighter policy from central banks, while
the chance of a pro-European coalition in Germany also boosted confidence in
the continent.

With the world in general and Europe in particular showing signs of
sustained economic growth, global stocks benchmarks jumped to fresh highs,
even though investors are now pricing in the withdrawal of central banks’
extraordinary stimulus.

That view was given further fuel last week by an account of European Central
Bank discussions which suggested policymakers could soon start preparing the
ground for a reduction in support.

The single currency rose to $1.2227 at one stage on Monday, a price last
seen in December 2014, just before the ECB first announced its massive
government bond purchase programme.

Nor is the ECB the only game in town: Bank of Japan Governor Haruhiko Kuroda
offered a positive view on his nation’s economy and inflation on Monday,
sending the yen to a four-month high against the dollar.

German Chancellor Angela Merkel’s CDU party and the Social Democrats (SPD)
are moving towards formal coalition talks, soothing concerns around Europe’s
largest economy.

The SPD’s pro-European stance -- leader Martin Schulz recently argued for a
“United States of Europe” -- also strengthens the case for investment in the
euro.

Euro zone money markets now price in a 70 percent chance of a 10 basis point
hike from the European Central Bank by the end of the year, up from 50
percent a week before.

The strength in the euro pushed European stocks a touch lower, as exporters
were hit by the currency strength. An index of pan-European stocks was down
0.2 percent on the day, but still not far from multi-year high hit last
week.

The slight fall comes in the wider context of a storming 2018 for world
stocks so far as investors bask in strong growth numbers from most of the
world’s largest countries.

MSCI’s all-country index of world stocks soared to new records overnight and
MSCI’s Asia ex-Japan index breached its 2007 high for the first time to set
a new all-time record.

Stocks in Hong Kong jumped 0.9 percent from Friday’s record closing high.
Investors were optimistic that Chinese gross domestic product data for the
December quarter due on Thursday would show growth of at least 6.7 percent
for the world’s second biggest economy.

The momentum of global economic growth through the closing months of last
year is being underlined by the early stages of the fourth-quarter earnings
season.

Earnings for S&P 500 companies are expected to increase on average by 12.1
percent in the quarter, with profit for financial services companies likely
to increase 13.2 percent, according to Thomson Reuters I/B/E/S.

Wall St stocks set new records on Friday, but U.S. markets will be mostly
closed on Monday for the Martin Luther King Day holiday.

DOLLAR DOWN

The dollar index showed no sign of bouncing early on Monday, instead edging
down to a fresh trough of 90.571.

Though the U.S. Federal Reserve is expected to continue to hike rates this
year, this has been largely priced in and investors are starting to position
for central bank action in Europe and Japan instead.

The dollar slipped to a six-week low on the yen at 110.73 yen, even as the
head of the Bank of Japan reiterated his commitment to keeping yields low.

Oil prices consolidated following six straight sessions of gains, with
output cuts led by OPEC and Russia as well as healthy demand keeping crude
near December 2014 highs.

Brent crude futures fell 23 cents to $69.64 a barrel, while U.S. crude was
lower 11 cents at $64.20.

Commodities Markets

Russian gold miner Polyus says Fosun stake deal scrapped

(Reuters) - Russia’s largest gold miner Polyus said on Monday that plans to
sell a 10 percent stake to a consortium led by China’s Fosun International
had been dropped after one of the conditions of the agreement was not met.

The Fosun-led consortium had been in talks since 2016 to buy a large
minority stake in Polyus, which is controlled by the family of Russian
tycoon Suleiman Kerimov. Kerimov was arrested as part of a tax evasion case
in France late last year.

Shares in the Russian gold producer fell 3.6 percent to a five-month low
after news that the $887 million deal had fallen through, leaving the
company the worst performer on Russia’s MOEX index .MCX.

Polyus declined further comment on the termination of the deal.

Russia, the world’s third largest gold producer, has been looking for
investments from Asian countries including China since sanctions were
imposed on Moscow by the West over its actions in Ukraine.

The deal for the Fosun-led consortium to buy 12,561,868 ordinary shares was
signed in May 2017 and later delayed until February this year.

Polyus delisted from the London Stock Exchange in 2015, but it returned to
London in June last year, buoyed by hikes in global gold prices and news of
the Fosun-led deal.

The Chinese deal had valued Polyus at $70.6 per share, which was equal to
the upper end of the price range for its share offer.

Fosun’s interest in the Russian gold miner came at a time when a number of
Chinese companies were targeting gold mine acquisitions in an attempt to
build on domestic demand amid the global recovery in prices.

China, the world’s top consumer, producer and importer of gold, has
ambitions to be a global price setter.

It was to be the Chinese group’s first Russian deal. Fosun had already set
up two subsidiary companies, Fosun Management (Russia) and Fosun Eurasia
Capital, with the aim of building its asset management business in Russia
and neighbouring regions, according to the company’s website.

Zinc surges to 10-year peak as base metals rally

(Reuters) - Zinc hit another 10-year high on Monday as base metals rallied
across the board on the back of a faltering dollar, with expectations that
the European Central Bank may start trimming its stimulus programme lifting
the euro to a three-year peak.

The dollar’s consequent weakness made assets priced in the U.S. unit cheaper
for holders of other currencies.

Fears over potential supply shortages and another drop in on-warrant
inventories available to the market are helping support the price of zinc,
used primarily to galvanise steel.

The market has been disappointed not to have seen more zinc production
capacity coming back onto the market from Glencore , Patterson said, after
the company curtailed 500,000 tonnes of capacity from late 2015. Glencore
announced plans in December to restart its Lady Loretta mine in the first
half of this year.

* ZINC PRICES: Three-month zinc on the London Metal Exchange was up 1.5
percent at $3,435.50 a tonne at 1030 GMT, having earlier touched a peak of
$3,440 a tonne, its highest since August 2007.

* ZINC INVENTORIES: On-warrant zinc stocks in LME-registered warehouses fell
by 10,000 tonnes to 116,675 tonnes, their lowest since early October, data
showed on Monday, after fresh cancellations in New Orleans. Headline stocks
are unchanged.

* COPPER: LME copper was up 1.7 percent at $7,231 a tonne. Prices have
oscillated around the range of $7,070-$7,315 since late December notably due
to resilient demand from China.

* PERU: Damage in world No. 2 copper producer Peru appeared limited after an
earthquake with a magnitude of 7.3 struck on Sunday. No victims have been
reported, the governor of Peru’s Arequipa region said on Twitter.

* ALUMINIUM PRICES: LME aluminium was up 1.3 percent at $2,242.50 a tonne.
In late December, it reached $2,290.50 a tonne, its highest in more than
four years, partly after output cuts in top producer China eroded global
supply.

* INVESTORS: Hedge funds and money managers trimmed net long positions in
COMEX copper contracts in the week to Jan. 9, U.S. Commodity Futures Trading
Commission (CFTC) data showed on Friday.

* OTHER METALS: LME nickel was up 1.9 percent at $12,965 a tonne, while tin
was flat at $20,270 a tonne, off an earlier three-month high of $20,301.
Lead was up 1.4 percent at $2,571 a tonne.

INVESTORS DIARY 2018

Company

Event

Venue

Date & Time

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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