Bulls n Bears Daily Market Commentary : 17 October 2018

Thu Oct 18 08:05:31 CAT 2018

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Bulls n Bears Daily Market Commentary : 17 October 2018

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

Zimbabwe Stock Exchange Update

Market Turnover $11,409,386.98 with foreign buys at $260,408.34 and foreign
sales were $481,090.76. Total trades were 170.

The All Share index rebounded with a 4.57 points  gain to close at 174.44
points. OLD MUTUAL  recovered $0.8510 to close at 8.2103, BRITISH AMERICAN
TOBACCO gained $0.2322 to trade at $38.0132 and ECONET’s winning streak
continued as it went further up by $0.1263 to close at $2.5678. SIMBISA
added $0.0863 to close at $0.8463 and PADENGA  moved up by $0.0725 to setlle
at $0.7125.

On the downside; PPC dropped $0.2000 to trade at $1.3000, INNSCOR  shed
$0.0457 to settle st $1.7017 and AMALGAMATED REGIONAL TRADING slipped $0.023
to close at $0.09200. Other losses were in DAIRIBORD which traded $0.0102
lower at $0.1800 and ZIMRE came off $0.0075 to trade at $0.0298.

 <mailto:info at bulls.co.zw> 

  Global Currencies & Equity Markets

Uganda

Ugandan shilling unchanged, commodity flows offer support

(Reuters) - The Ugandan shilling was stable on Wednesday, helped by some
inflows from commodity exporters and weak demand from importers.

At 0958 GMT, commercial banks quoted the shilling at 3,775/3,785, the same
level as Tuesday’s close.

South Africa

South Africa's rand firmer on risk sentiment rally, stocks falter

(Reuters) - South Africa’s rand firmed on Wednesday as a jump in domestic
retail sales and a global return of risk sentiment helped the currency claw
back earlier losses.

Stocks were down with Healthcare group Mediclinic hitting a session-low of
19 percent on an expected downturn in its first-half earnings.

At 1617 GMT, the rand was 0.4 percent stronger at 14.1150 per dollar versus
14.1700 overnight in New York.

South Africa’s retail sales rose 2.5 percent year-on-year in August as
household goods, clothing and cosmetics grew, with recovering consumer
spending a possible sign the economy is climbing out of a recession that has
piled pressure on President Cyril Ramaphosa.

The rand has been on the back foot following second-quarter gross domestic
product data on Sept. 4 which showed the economy had entered a recession.

Government bonds were flat, with the yield on the benchmark paper due in
2026 at 9.120 percent.

On the bourse, the All-Share index fell 1.6 percent to 52,391 points while
the blue chip Top-40 index fell 1.79 percent 46,164 points.

Healthcare group Mediclinic closed 16.9 percent down to 73.96 rand after it
flagged an 8 percent drop in core profit for the first six months of the
year. Its shares had tumbled 19 percent earlier in the session.

On the flipside, South African building materials retailer Cashbuild rose
0.17 percent to 258.89 after it reported revenue was up 3 percent in the
first quarter compared with the year-ago period.

       <mailto:info at bulls.co.zw> 

America

Dollar at 1 week high after hawkish Fed minutes; Asia stocks capped

(Reuters) - Asian stocks were capped and the dollar rose to a one week-high
in early Thursday trade after the minutes of the Federal Reserve’s latest
meeting showed broad agreement among board members on the need to raise
borrowing costs further.

The spectre of rising U.S. dollar yields, which along with global trade
tensions were at the centre of last week’s global equities rout, kept
riskier appetite in check in Asia.

MSCI broadest index of Asia-Pacific shares outside Japan fell 0.2 percent,
while the Australian benchmark also dropped 0.2 percent.

Japan’s Nikkei average was flat, and appeared to struggle for headway. Data
out earlier in the day showed exports from the world’s third-biggest economy
dropped for the first time since late 2016, hit by declines in shipments to
the United States and China.

The U.S. dollar index and Treasury yields rose to its highest levels in a
week on Wednesday.

The dollar index, which measures its value against six major peers, last
traded at 95.654, little changed on the day, while 10 year Treasury yield
last stood at 3.211 percent, 3.2 basis points higher than the U.S. close.

The minutes from the Fed’s Septa 25-26 meeting showed every Fed policymaker
backed raising interest rates last month and also generally agreed borrowing
costs were set to rise further, despite U.S. President Donald Trump’s view
that the tightenings have already gone too far.

Major currencies have shown limited reaction after the U.S. government late
on Wednesday refrained from naming China or any other trading partner as a
currency manipulator, as it leans on import tariffs to try to cut a trade
deficit with China, soothing investor sentiment in Asia.

In its semi-annual currency report, the U.S. Treasury Department said a
recent depreciation of China’s yuan currency will likely exacerbate the U.S.
trade deficit, but U.S. officials found Beijing appeared to be doing little
to directly intervene in the currency’s value.

The yuan was steady at 6.9315 per dollar in the offshore trade, not far off
1-1/2-year low of 6.9587 touched in August.

But some investors remain wary of a slide towards the psychologically
important level of 7 to the dollar.

In Europe, the European Council meeting kicked off on Wednesday with a
roundtable dinner, with British Prime Minister Theresa May’s address ahead
of it, though expectations that anything substantial will come out of it
have already been fading.

Oil prices fell on Wednesday, with U.S. futures settling below $70 a barrel
for the first time in a month, after U.S. crude stockpiles rose 6.5 million
barrels, almost triple what analysts had forecast, while exports dropped.

The West Texas Intermediate crude futures and Brent crude futures last
traded at $69.79 and $80.08 a barrel, respectively.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Copper slips on stronger dollar, China economic pressure

(Reuters) - London copper edged lower on Thursday as the U.S. dollar
strengthened after minutes from the Federal Reserve’s meeting last month
showed more interest rate increases are likely for the rest of the year.

Comments from Chinese Premier Li Keqiang that China’s economy faces
increasing downward pressure amid an ongoing trade war with the United
States also weighed on sentiment.

Three-month copper on the London Metal Exchange was down 0.3 percent at
$6,202 a tonne by 0218 GMT, and below this week’s high of $6,342. The
most-traded December copper contract on the Shanghai Futures Exchange gained
0.2 percent to 50,170 yuan ($7,232) a tonne.

Other LME metals were also weaker including aluminium, zinc, lead and
nickel.

While metals demand remains healthy “concerns about the economic outlook
have intensified in recent months,” Goldman Sachs analysts said in a report
this week.

* CHINA ECONOMY: Li, while on a trip to Europe, said Beijing is determined
to cope with risks and challenges for the economy which he expects to grow
within a reasonable range in the third quarter.

* U.S. RATE HIKES: Federal Reserve policymakers are largely united on the
need to raise borrowing costs further, minutes from their September policy
meeting show, despite U.S. President Donald Trump’s view that interest rate
hikes have already gone too far.

* DOLLAR: Amid expectations for further U.S. rate hikes, the dollar traded
stronger versus its major peers, making dollar-priced assets costlier for
holders of other currencies.

* FREEPORT: Indonesia’s state-owned miner Inalum is looking to finalise a
$3.85 billion deal for majority control of the local unit of global mining
giant Freeport McMoRan Inc in December.

* PRICES: LME aluminium dropped 0.2 percent to $2,018 a tonne, zinc declined
0.6 percent to $2,649.50 and lead lost 0.9 percent to $2,029. In Shanghai,
aluminium shed 1.2 percent to 14,130 yuan, zinc climbed 1.2 percent to
22,560 yuan and nickel fell 1.1 percent to 101,660 yuan.

Australia's South32 1st-qtr coking coal production triples

(Reuters) - Australian miner South32 on Thursday said first-quarter coking
coal output more than tripled from the same year-ago period, helped by
robust production at its Appin and Dendrobium collieries.

Production of coking coal, also known as metallurgical coal, at the mines in
Illawarra rose to 1.5 million tonnes in the first quarter of the 2019 fiscal
year from 494,000 tonnes a year earlier. That handily beat a UBS estimate of
1.2 million tonnes.

South32 had suspended operations at its Appin coal mine on the order of a
government regulator last June due to concerns over high gas levels in the
mine.

The world’s largest manganese miner produced 1.4 million tonnes of the
commodity during the quarter, about 11 percent higher over last year.

However, in the July-September quarter, the company reported a 12 percent
drop up in alumina sales from its Worsley Alumina refinery, hit by
maintenance efforts.

South32 maintained fiscal 2019 production guidance for all its operations. 

INVESTORS DIARY 2018

Company

Event

Venue

Date & Time

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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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