Bulls n Bears Daily Market Commentary : 05 July 2018

Fri Jul 6 09:23:38 CAT 2018

 <http://www.bulls.co.zw/> Bulls.co.zw        <mailto:bulls at bulls.co.zw>
Views & Comments        <http://www.bulls.co.zw/blog> Bullish Thoughts
<http://www.twitter.com/BullsBears2010> Twitter
<https://www.facebook.com/BullsBearsZimbabwe> Facebook
<http://www.linkedin.com/pub/bulls-n-bears-zimbabwe/57/577/72> LinkedIn
<mailto:info at bulls.co.zw?subject=Unsubscribe> Unsubscribe

Bulls n Bears Daily Market Commentary : 05 July 2018

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

Zimbabwe Stock Exchange Update

Market Turnover $4,270,364.32 with foreign buys at $3,330,405.10 and foreign
sales were $1,600,000.00. Total trades were 67.

The All Share index rebounded 0.14 points to settle at 103.21 points as
three counters gained ground. PPC LIMITED went up by $0.0463 to close at
$1.2500, DELTA  shifted up $0.0122 to $1.8504 while FIRST MUTUAL PROPERTIES
advanced by $0.0008 to close at $0.0450.

However, OLD MUTUAL LIMITED dropped by $0.0399 to trade at $4.7994 and
MASHONALAND HOLDINGS lost $0.0010 to end at $0.0220.

 <mailto:info at bulls.co.zw> 

Global Currencies & Equity Markets

Nigeria

Nigeria woos importers to trade Chinese yuan

(Reuters) - Nigeria’s central bank is wooing local businesses importing
goods from China to use the yuan instead of the U.S. dollar in its effort to
support its naira currency and boost reserves.

Central bank officials on Wednesday held a town hall meeting with businesses
in Lagos to introduce the yuan for imports from China ahead of plans to
start auctioning the Asian currency later this month.

The dollar is Nigeria’s main trade currency. The OPEC member suffered severe
dollar shortages after the price of crude oil, its top export and main
source of FX, plunged in late 2014, prompting it to introduce capital
controls in 2015.

It now has multiple exchange rates against the U.S. currency and has been
selling the dollar on the interbank market to boost liquidity after floating
the naira for investors.

Nigeria signed a $2.5 billion currency swap arrangement with the People’s
Bank of China (PBOC) in May.

Officials said the deal is aimed at reducing reliance on the dollar and “as
such reduce the pressure on the naira-dollar exchange rate.”

Under the swap arrangement, Nigeria’s central bank would hold 720 billion
naira in an account in favour of the PBOC while the Chinese central bank
would hold 15 billion yuan, impling an exchange rate of 48 naira to the
yuan.

The bank also said the move was aimed at encouraging Chinese firms buying
local raw materials and semi-finished goods to pay in naira. However payment
for crude oil sold to China would be in U.S. dollar, they said.

Nigeria has been trying several options to curb pressure on the naira. But
some of its plans may require time to materialise as it needs to develop its
economy in order to cut imports.

It currently runs a large trade deficit with China, its biggest trading
partner. Nigeria imported goods worth almost $2 billion per annum from China
last year as against almost $500 million imported by the Chinese, figures
showed.

Economists fear that currency swap could worsen the deficit and trade
balance. Some importers told Reuters that a strong naira would erase the
benefit of the swap but added that the naira may weaken especially after
elections next year.

Nigeria has around 4.4 percent of its foreign reserves of $47 billion
denominated in yuan while the remaining is held in U.S. dollar. Officials
expect the move to also boost foreign investment from China into Nigeria.

South Africa

South Africa's rand opens weaker in choppy trade

(Reuters) - South Africa’s rand edged weaker in early trade on Thursday.

* At 0630 GMT the rand was 0.13 percent weaker at 13.6950, above the 13.60
resistance mark that has recently drawn in sellers looking to pocket dollars
cheap.

* Trade across emerging market currencies has been volatile in recent weeks
with the trade war brewing between the U.S. and China cooling risk demand,
while the rand has also been restrained by lukewarm economic indicators.

* Investors to eye release of minutes of the U.S. Federal Reserve’s last
policy meeting.

* Government bonds inched firmer, with the yield on the benchmark instrument
due in 2026 falling 0.5 basis points to 8.745 percent.

* The Johannesburg Stock Exchange was set to open flat at 0700 GMT, with the
Top 40 futures index down 0.24 percent.

Europe

Europe shrugs off Asian gloom, euro shuffles higher

(Reuters) - European shares headed for a third day of gains on Thursday, as
reassuring economic data from Germany and a report that its big carmakers
could be spared from U.S. tariffs offset another gloomy session for Asia.

Trade war nerves had pegged all of Asia’s bourses back with a U.S. deadline
to impose tariffs on Chinese imports just a day away, but it was another
widely-flagged target - the German car sector - that drove Europe’s fast
start.

Mercedes-maker Daimler, and BMW Porsche and Volkswagen raced up as much as 5
percent after a newspaper report about a U.S. offer to suspend tariff
threats on EU-made cars if the bloc lifts its duties on U.S. ones.

The mood was also helped as German industrial orders saw a
stronger-than-expected jump after four months of falls.

The euro briefly topped $1.17 and bond yields also rose on a report that the
ECB thinks markets are now too cautious on when it will raise euro zone
interest rates next year.

Later in the day, traders will also get the minutes from the recent meeting
of the U.S. Federal Reserve where it raised rates for a second time this
year and flagged that more are likely.

The overnight slide in Asian markets, in particular Chinese shares which are
now deep into ‘bear’ market territory, highlighted the ongoing angst over
U.S. President Donald Trump’s trade tariff plans.

On Friday, U.S. tariffs on $34 billion worth of Chinese imports will take
effect, and Beijing has promised to retaliate in kind, though it did say
overnight that it will “absolutely not” fire the first shot in a trade war.

MSCI’s broadest index of Asia-Pacific shares outside Japan , which has been
dropping since Monday, ended down 0.5 percent. The index has lost about 2
percent this week, plumbing a nine-month low in the process.

Japan’s Nikkei shed 1 percent, South Korea’s KOSPI slipped 0.75 percent,
Hong Kong’s Hang Seng was off 0.9 percent and the Shanghai Composite Index
fell 0.9 percent to take its dive since late January to 23 percent.

With Europe advancing though, Wall Street’s S&P 500 futures edged up 0.4
percent and Dow futures added 0.3 percent, pointing to a solid start
following Wednesday’s Independence Day holiday.

WEAPONIZE

In currencies, the euro’s gain was the dollar’s loss. That also helped ease
some of the pressure on volatile emerging market currencies, though Turkey’s
lira went lower again as its prime minister said cutting interest rates was
a top priority.

The Chinese yuan was also slightly lower, its recovery from an 11-month low
stalling. A rebound in the yuan was triggered in the past two sessions after
the country’s central bank sought to calm nervous markets and stem the
recent tumble.

The longer term direction for the yuan was still unclear. China appears
broadly comfortable with a weakening yuan and would intervene only to
prevent any destabilising declines or to restore market confidence, policy
insiders told Reuters.

The dollar was 0.1 percent higher against the yen at 110.610 yen, though it
was sticking in a narrow range ahead of the Federal Reserve minutes that
could give fresh clues on central bank’s rate hike plans.

In commodities, Brent oil futures were down 0.7 percent at $77.69 a barrel,
after U.S. President Donald Trump sent a tweet demanding that OPEC reduce
prices for crude.

Brent had risen on Wednesday on a threat from an Iranian commander to
disrupt oil shipments from neighboring states if Washington continued to
press all countries to stop buying Iranian oil, and a drop in U.S. crude
inventories.

Commodities Markets

Copper hits 9-month low amid trade tensions

(Reuters) - Copper fell to a fresh nine-month low on Wednesday ahead of the
implementation of trade tariffs on goods from China and the United States
which could dampen demand for the industrial metal.

Benchmark copper on the London Metal Exchange slipped 0.6 percent to $6,450
per tonne in official rings, its weakest since September 2017.

Washington has said it would implement tariffs on $34 billion of Chinese
imports on July 6, and Beijing has vowed to retaliate in kind on the same
day.

TRADE: China’s threatened tariffs on $34 billion of U.S. goods will take
effect from the beginning of July 6, a person with knowledge of the plan
told Reuters, amid worsening trade tensions between the world’s two largest
economies.

EUROPEAN UNION: China is putting pressure on the European Union to issue a
strong joint statement against President Donald Trump’s trade policies at a
summit later this month but is facing resistance, European officials said.

FREEPORT: Indonesia has extended a temporary operating permit for Freeport
McMoRan Inc’s Grasberg project, the world’s second-biggest copper mine,
until the end of the month while discussions continue over long-term rights.

CODELCO: Workers at Codelco’s Chuquicamata copper mine in Chile, the state
miner’s second largest by output, threatened last week to strike over plans
to transform the century-old open pit into an underground mine.

CHINA DATA: Growth in China’s services sector accelerated in June to a
four-month high, buoyed by a pickup in new businesses and a sustained
increase in employment, a private survey showed.

ZINC, NICKEL: Zinc dropped 1.6 percent to $2,744 a tonne, having touched its
lowest since July 2017, and nickel was bid down 1.5 percent to $14,195 a
tonne.

WARRANTS: Traders are also watching a large holding, between 40 and 59
percent, of zinc warrants on the LME. It has fuelled worries about a
shortage on the LME market and led to a premium for the cash contract over
the three-month.

GLENCORE: U.S. authorities have demanded Glencore hand over documents about
its business in the Democratic Republic of Congo, Venezuela and Nigeria as
part of a corruption probe, sending the mining company’s shares down more
than 8 percent.

PRICES: Aluminium was bid down 0.9 percnet to $2,098 per tonne, lead was bid
down 0.7 percent to $2,374 and tin added 0.4 percent to $19,725.

INVESTORS DIARY 2018

Company

Event

Venue

Date & Time

Barclays

EGM to consider the change of registered statutory name to First Capital
Bank Limited

Meikles Hotel

03/07/2018 3pm

NicozDiamond

shares delist from the ZSE

06/07/2018

Zimbabwe

Heroes’ Day

Zimbabwe

13/08/2018

Zimbabwe

Defence Forces Day

Zimbabwe

14/08/2018

The Harare Agricultural Show

The Harare Agricultural Show

The Harare Agricultural Show

August 27- September 1

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.

(c) 2018 Web: <http:// www.bulls.co.zw >  www.bulls.co.zw Email:
<mailto:info at bulls.co.zw> info at bulls.co.zw Tel: +263 4 2927658 Cell: +263 77
344 1674

Invest Wisely!

Bulls n Bears 

Telephone:      <tel:%2B263%204%202927658> +263 4 2927658

Cellphone:      <tel:%2B263%2077%20344%201674> +263 77 344 1674

Alt. Email:       <mailto:info at bulls.co.zw> info at bulls.co.zw  

Website:
<http://www.google.com/url?q=http%3A%2F%2Fwww.bulls.co.zw&sa=D&sntz=1&usg=AF
QjCNH8LYgdY55h-XKseuM8Kpr-JKdfhQ> www.bulls.co.zw 

Blog:
<http://www.google.com/url?q=http%3A%2F%2Fwww.bulls.co.zw%2Fblog&sa=D&sntz=1
&usg=AFQjCNFoIy6F9IXAiYnSoPSgWDYsr8Sqtw> www.bulls.co.zw/blog

Twitter:         @bullsbears2010

LinkedIn:       Bulls n Bears Zimbabwe

Facebook:
<http://www.google.com/url?q=http%3A%2F%2Fwww.facebook.com%2FBullsBearsZimba
bwe&sa=D&sntz=1&usg=AFQjCNGhb_A5rp4biV1dGHbgiAhUxQqBXA>
www.facebook.com/BullsBearsZimbabwe

Skype:         Bulls.Bears 

-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://listmail.bulls.co.zw/pipermail/bulls/attachments/20180706/218dcf79/attachment-0001.html>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: image001.jpg
Type: image/jpeg
Size: 3653 bytes
Desc: not available
URL: <http://listmail.bulls.co.zw/pipermail/bulls/attachments/20180706/218dcf79/attachment-0006.jpg>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: image002.jpg
Type: image/jpeg
Size: 32675 bytes
Desc: not available
URL: <http://listmail.bulls.co.zw/pipermail/bulls/attachments/20180706/218dcf79/attachment-0007.jpg>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: image003.jpg
Type: image/jpeg
Size: 29401 bytes
Desc: not available
URL: <http://listmail.bulls.co.zw/pipermail/bulls/attachments/20180706/218dcf79/attachment-0008.jpg>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: image004.jpg
Type: image/jpeg
Size: 37760 bytes
Desc: not available
URL: <http://listmail.bulls.co.zw/pipermail/bulls/attachments/20180706/218dcf79/attachment-0009.jpg>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: image005.jpg
Type: image/jpeg
Size: 159128 bytes
Desc: not available
URL: <http://listmail.bulls.co.zw/pipermail/bulls/attachments/20180706/218dcf79/attachment-0010.jpg>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: image006.jpg
Type: image/jpeg
Size: 4846 bytes
Desc: not available
URL: <http://listmail.bulls.co.zw/pipermail/bulls/attachments/20180706/218dcf79/attachment-0011.jpg>