Bulls n Bears Daily Market Commentary : 18 January 2018

Thu Jan 18 16:36:24 CAT 2018

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Bulls n Bears Daily Market Commentary : 18 January 2018

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

Zimbabwe Stock Exchange Update

Market Turnover $2,065,348.71 with foreign buys at $705,675.96 and foreign
sales were $396,874.74 . Total trades were 75 .

The All Share Index shed 1.26 points   to close at 91.98 points. ECONET
eased $0.0802 to trade at $0.7425, PADENGA  dropped $0.0200 to $0.4800 while
BARCLAYS   slipped $0.0020 to end at $0.0500. WILLDALE   inched down $0.0008
to settle at $0.0060. 

Gains were seen in OLD MUTUAL   which advanced by $0.1464 to close at
$5.0939,  DELTA  put on $0.0080 to end at $1.5832 while CBZ   closed at
$0.0900 after gaining $0.0065. MEIKLES  advanced by $0.0050 to close at
$0.3050. 

 <mailto:info at bulls.co.zw> 

Global Currencies & Equity Markets

Kenya

Kenyan shilling stable, portfolio flows eyed

(Reuters) - Kenya's shilling was steady on Thursday and traders said they
were focusing on the level of dollar inflows into the local debt and stock
markets to gauge its future direction.

At 0755 GMT, commercial banks quoted the shilling at 102.90/103.00, compared
with Wednesday's close of 102.95/103.05. 

Kenyan stocks have been buoyed by the global risk appetite this year while
the central bank is selling a 40 billion shilling bond this year, which is
expected to lure in foreign investors.

South Africa

South African central bank holds repo rate at 6.75 pct

(Reuters) - South Africa’s central bank kept its benchmark repo rate
unchanged at 6.75 percent on Thursday, saying that risks to the inflation
forecast were still assessed to be on the upside.

The majority of analysts polled by Reuters last week had predicted the repo
rate would stay on hold.

Central bank governor Lesetja Kganyago told a news conference that five
members of the monetary policy committee had voted to hold rates and one
member had voted for a 25 basis point cut. 

America

Dollar recovers but diversification plays weigh

LONDON (Reuters) - The dollar edged higher on Thursday after plumbing a
three-year low hit earlier in the session as higher U.S. Treasury yields
prompted some investors to pare bearish bets against the greenback.

A wary outlook capped gains, however.

With global investors including sovereign wealth funds and central banks
looking to diversify their dollar holdings into other currencies such as the
euro, market watchers say the dollar’s latest bounce may be short lived.

An analysis of the quarterly data published by the International Monetary
Fund of the currency composition of the world’s foreign exchange reserves
held by global central banks showed that reserve managers were increasing
the pace of adding non-dollar based currencies to their reserves.

BNY Mellon strategists said the increase in holdings of pounds and euros in
global central banks’ reserves over the three quarters ending September 2017
indicate increased allocations, fuelled by protracted dollar weakness.

Dollar-denominated assets still account for about 63 percent of allocated
central bank reserves followed by the euro at around 20 percent and then
other currencies, according to latest IMF data.

Commodities Markets

China ramps up aluminium output in Dec amid new capacity launches

(Reuters) - China’s aluminium production rebounded in December to its
highest since June, reversing five months of declines, as state-owned
Chinalco launched new capacity even as Beijing curbed its private rivals,
lifting 2017 output to a record.

The world’s top aluminium producer churned out 2.71 million tonnes of the
metal last month, up 15.3 percent from 2.35 million tonnes in November,
although it was down 1.8 percent from a year ago, the National Bureau of
Statistics (NBS) reported on Thursday.

For the full year, China produced 32.27 million tonnes of aluminium, a rise
of 1.6 percent from 2016, the data showed.

November output fell 7.8 percent from October as production cuts of as much
as 30 percent at some Chinese aluminium smelters began kicking in fully by
the middle of the month as part of a government crackdown on air pollution.

December’s monthly jump reflects the start up late last year of new smelting
capacity in Inner Mongolia by Aluminum Corp of China (Chinalco) and in the
southern province of Guangxi, regions that were not required to cut capacity
under the pollution crackdown, analysts said.

Paul Adkins, managing director of consultancy AZ China, said 357,000 tonnes
of annual smelting capacity came on line last month. He also pointed out
that December has one more day than November, which means 3 percent, or
87,000 tonnes, more metal production.

The data will likely stir the debate about the government’s years-long push
to get rid of excess capacity, and could raise tensions with rival
producers, like the United States and Europe, which accuse China of
exporting its unwanted metal onto the international market.

AZ China’s own estimate for China’s December production is 2.975 million
tonnes, 10 percent higher than the official NBS number, and 36 million
tonnes for the year. Many analysts consider the NBS data to be conservative.

CLSA’s Victor You estimates another 3.6 million tonnes of new aluminium
smelting capacity could come on stream in China in 2018, equivalent to over
11 percent of last year’s production.

China’s overall non-ferrous metals output -- including copper, aluminium,
lead, zinc and nickel -- rose to 4.72 million tonnes in December, up 9.3
percent from 4.32 million tonnes in November, to the highest level since
June and up 2.8 percent from a year earlier.

Full-year nonferrous production stood at 53.78 million tonnes, up 3 percent
from 2016, to set a new annual record. 

Upbeat China industrial data boosts copper

(Reuters) - Copper rose on Thursday as robust performance by China’s
industrial sector helped to lift the biggest metal consumer’s economic
growth in the fourth quarter.

Benchmark copper rose 0.8 percent to $7,090.50 a tonne by 1146 GMT after the
metal used in power and construction touched a four-week low in the previous
session.

CHINA GDP: China’s economy grew faster than expected in the fourth quarter,
helped by a rebound in the industrial sector, a resilient property market
and strong export growth.

HOME PRICES: China’s housing market picked up slightly in December, but
price growth more than halved in 2017 as government curbs on speculation
took effect.

U.S. INDUSTRIAL DATA: U.S. industrial production increased more than
expected in December but manufacturing output barely rose, pointing to
moderate growth in the sector.

COPPER BOOST: Chile’s state copper commission, Cochilco, on Wednesday raised
its estimated 2018 average price for the metal to $3.06 per pound from its
previous forecast of $2.95, pointing to the potential for global supply
disruptions this year.

TECHNICALS: The $7,000/$7,005 area should provide decent support and a break
below that would open up a likely test of $6,900, said Marex Spectron’s
Alastair Munro. “Expect some resistance into $7,117 then $7,145 on an
intra-day basis,” he said.

BHP: Copper output at BHP jumped 20 percent to 429,000 tonnes in the three
months to Dec. 31, helped by a rise in production at its Escondida mine in
Chile.

FORCE MAJEURE: The Oyu Tolgoi copper-gold mine in Mongolia’s southern Gobi
Desert declared force majeure after protests by Chinese coal haulers
disrupted deliveries near the border, majority owner Turquoise Hill said on
Wednesday.

ALUMINIUM OUTPUT: China’s primary aluminium production rebounded in December
after five months of decline despite winter output restrictions imposed on
smelters, helping to lift total 2017 output to record levels.

PRICES: Aluminium rose 1.4 percent to $2,223.50 a tonne, lead added 1.3
percent to $2,578.50, tin was slightly lower at $20,480, zinc edged up 0.6
percent to $3,387.50 and nickel was up 0.6 percent at $12,485.

INVESTORS DIARY 2018

Company

Event

Venue

Date & Time

Robert Mugabe National Youth Day

21 Feb 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
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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