Bulls n Bears Daily Market Commentary : 05 June 2018

Wed Jun 6 07:41:00 CAT 2018

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Bulls n Bears Daily Market Commentary : 05 June 2018

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Zimbabwe Stock Exchange Update

Market Turnover $2,028,496.12 with foreign buys at $233,478.04 and foreign
sales were $237,458.57. Total trades were 127.

The All Share index closed higher at 112.88 points after adding 0.77 points
. ECONET  increased by $0.0486 to close at $1.0983 , INNSCOR traded firmer
at $1.3500 after putting on $0.0300 and DELTA  was up $0.0103 to trade at
$2.2103.  OK ZIMBABWE  also added $0.0083 to close at $0.2182 and TSL
gained a marginall $0.0080 to settle at $0.4100.

Trading in the negative OLD MUTUAL lost $0.5372 to close at $6.9628 ,
SIMBISA  traded $0.0097 lower at $0.4600 and  DAIRIBORD  was $0.0058 weaker
at $0.1500. PPC  also lost $0.0025 to trade at $1.4975 and STARAFRICA
CORPORATION  closed at $0.0179 after losing $0.0017.

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Global Currencies & Equity Markets

Kenya

Kenyan shilling firm on offshore liquidity

(Reuters) - The Kenyan shilling was firm against the dollar on Monday
supported by increased dollar liquidity from offhsore investors meeting
importer demand, traders said.

At 0830 GMT, commercial banks quoted the shilling at 101.30/50 per dollar,
compared with 101.40/60 at Thursday's close. Kenyan markerts were closed on
Friday for a public

holiday.

South Africa

South African rand slightly firmer, focus on economic growth numbers

(Reuters) - South Africa’s rand firmed slightly against the dollar early on
Monday, as traders awaited growth and manufacturing numbers due this week to
see how the economy is faring under President Cyril Ramaphosa.

* At 0620 GMT, the rand traded at 12.6600 per dollar, 0.26 percent firmer
than its close on Friday.

* Statistics South Africa publishes first-quarter GDP figures on Tuesday and
April manufacturing data on Thursday.

* A survey on Friday showed conditions in South Africa’s manufacturing
sector deteriorated slightly last month, suggesting the economy remained
fragile under Ramaphosa, who replaced Jacob Zuma in February.

* “Locally economic data disappointed in recent days, in our view. In light
of the external environment, the disappointing data should make it more
difficult for the rand to sustain a rally,” Nedbank analysts wrote in a
note.

* In fixed income, the yield on the benchmark government bond due in 2026
was down one basis point at 8.61 percent. 

Europe

Stocks gain, dollar falls; political worries ease in Europe

(Reuters) - Stocks on world indexes and Treasury yields climbed on Monday,
while the dollar fell to a two-week low as political tensions in Europe
eased.

Italy’s anti-establishment parties formed a coalition government on Friday
to end three months of political deadlock.

Italian bond yields fell after soaring last week on fears a snap election
would be called that might effectively become a referendum on euro
membership.

The spread on Spanish bond yields over benchmark German Bunds also narrowed
after a new prime minister was sworn in in Madrid, though Socialist Pedro
Sanchez’s minority administration faces a tough baptism from a revived
independence drive in Catalonia.

U.S. Treasury yields rose as investors pared their safe-haven holdings of
lower-risk government debt amid reduced anxiety about the political turmoil
in Italy and Spain.

Benchmark 10-year notes last fell 6/32 in price to yield 2.9168 percent,
from 2.895 percent late on Friday.

The dollar index fell 0.13 percent, with the euro up 0.21 percent to
$1.1685.

Lingering trade disputes will also contribute to a challenging backdrop for
the U.S. dollar in the weeks ahead, he added.

U.S. stocks rose on Monday led by gains in technology shares and helped by
Friday’s robust jobs data, which gave investors heightened confidence that
the U.S. economy remained strong.

The Dow Jones Industrial Average rose 174.7 points, or 0.71 percent, to
24,809.91, the S&P 500 gained 8.01 points, or 0.29 percent, to 2,742.63 and
the Nasdaq Composite added 25.92 points, or 0.34 percent, to 7,580.25.

MSCI’s gauge of stocks across the globe gained 0.54 percent. European shares
rose 0.22 percent.

While the risk of political crisis receded in Europe, concerns over a
possible global trade war rumbled on in the background.

Finance ministers of the closest U.S. allies vented their anger on Saturday
over Washington’s imposition of metal import tariffs, setting the tone for a
heated G7 summit in Quebec.

Prime Minister Justin Trudeau this week plays host to a summit of the Group
of Seven leading industrialized nations with six of the seven members
outraged at the United States over a slew of recent moves by President
Trump.

Trudeau, who wants the June 8-9 meeting to focus on economic growth, insists
he can handle the challenge, though insiders and analysts say he will have
to fight to keep the grouping together at a time when Trump’s trade and
diplomatic moves have isolated the United States and risk undermining the
G7’s relevance.

Washington also remained at odds with Beijing after U.S. Commerce Secretary
Wilbur Ross met Chinese Vice Premier Liu He. China warned the United States
on Sunday that any bilateral agreements reached on trade and business would
be void if Washington implemented tariffs and other trade measures.

But this did not stop Asian shares from rallying. MSCI’s broadest index of
Asia-Pacific shares outside Japan closed 1.39 percent higher, while Japan’s
Nikkei rose 1.37 percent.

In the oil market, U.S. crude fell 1.46 percent to $64.85 per barrel and
Brent was last at $75.46, down 1.73 percent on the day.

Commodities Markets

Copper higher as wage talks start at world's largest mine

(Reuters) - Copper prices rose on Monday, helped by a weaker dollar and
potential supply problems as wage talks began at the world’s largest copper
mine.

The union at BHP’s Escondida mine in Chile said on Friday it had begun
negotiations with a proposal that includes a bonus of about $34,000 per
worker.

That stirred memories of failed talks last year which led to a 44-day strike
and pushed copper prices sharply higher.

Any interruption at Escondida would come on top of the closure of India’s
second largest smelter after environmental protests.

It could tip the market into deficit. The International Copper Study Group
sees the 24 million-tonne-a-year copper market with a 43,000 tonne surplus
this year and a deficit of 331,000 tonnes in 2019.

COPPER: Benchmark copper on the London Metal Exchange (LME) did not trade in
official rings but was bid up 0.6 percent at $6,935 per tonne after hitting
$6,964.50, its highest level since May 23.

TECHNICALS: Copper has been stuck in a range between around $7,300 and
$6,600 since hitting a four-year high in December. On Monday it broke above
its 100-day moving average, improving its technical picture, and was poised
to move above its downtrend line from its April high.

POSITIONING: Positioning by speculative investors in LME copper was largely
neutral, brokers at Marex Spectron said.

SPREAD: The premium of three month copper over the cash contract MCU0-3 has
fallen to $5, the lowest since March 2017, signalling tighter supply.

PERU COPPER MINE: China’s Chinalco said it had begun a $1.3 billion
expansion of its Toromocho mine in Peru which it said would raise copper
output by 45 percent by 2020. China’s official Xinhua news agency said
Chinalco aimed to bring annual refined copper output to 300,000 tonnes.

DOLLAR: Industrial metals received some support as a six-week rally in the
dollar appeared to stall. A stronger dollar makes metals more expensive for
buyers with other currencies.

CHINA DEMAND: China’s economic growth could slow to around 4.5 percent over
the medium term, Fitch Ratings said, adding that it expected oil and metal
prices to fall 5 to 10 percent from its baseline scenario because China is
such a large consumer.

OTHER METALS: LME aluminium was bid up 0.6 percent at $2,319 a tonne, zinc
traded 0.5 percent lower at $3,087, nickel was bid down 1 percent at
$15,290, lead was bid 0.3 percent lower at $2,436 and tin traded down 0.9
percent at $20,555.

Canada mulls aid for steel, aluminum industry after U.S. tariffs

(Reuters) - Canada’s cabinet on Monday discussed how to protect the domestic
steel and aluminum industry from U.S. tariffs, just hours ahead of a
scheduled meeting between Prime Minister Justin Trudeau and domestic
industry leaders.

U.S. President Donald Trump last week unveiled a 25 percent tariff on
Canadian steel and a 10 percent tariff on aluminum, citing national security
reasons. Trudeau denounced the move.

A source familiar with the matter said the tariffs would be discussed as
ministers opened a meeting at 0930 eastern time (1330 GMT). A spokesman for
Trudeau declined to comment on what steps the cabinet might take.

This weekend, Foreign Minister Chrystia Freeland said Ottawa was mulling an
aid package which could be similar to the support for softwood lumber
producers that Ottawa unveiled in June 2017 after Washington imposed
tariffs.

Trudeau is due to meet members of the Canadian Steel Producers Association
at 1230 ET.

Canada is the No. 1 steel exporter to the United States. Some 84 percent of
its steel exports, worth C$9.0 billion ($6.97 billion), were sent south last
year, according to Statistics Canada.

It accounts for about 22,000 direct jobs and supports 100,000 jobs
indirectly, said the Canadian Steel Producers Association.

Canada retaliated against the steel and aluminum tariffs by proposing tariff
on C$16.6 billion worth of U.S. exports and said it would challenge the U.S.
move through the North American Free Trade Agreement and the World Trade
Organization.

Trade ties between Canada and the United States have soured since Trump took
power in January 2017.

In June 2017, Ottawa announced an C$867 million package for softwood lumber
producers.

Freeland said the government was pondering whether to do the same for steel
and aluminum producers.

$1 = 1.2911 Canadian dollars

INVESTORS DIARY 2018

Company

Event

Venue

Date & Time

Edgars

AGM

Edgars Training Auditorium, 1st Floor, LAPF House, 8th Ave/Jason Moyo St,
Bulawayo

07/06/2018 9am

Turnall

AGM

Jacaranda Room, Rainbow Towers

07/06/2018 9am

FMHL

AGM

Royal Harare Golf Club

11/06/2018 2:30pm

RioZim

AGM

Head Office, 1 Kenilworth Road, Highlands

21/06/2018 10:30am

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.

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