Bulls n Bears Daily Market Commentary : 03 April 2019

Thu Apr 4 08:20:26 CAT 2019

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Bulls n Bears Daily Market Commentary : 03 April 2019

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Zimbabwe Stock Exchange Update

Market Turnover RTGS$6,460,288.77 with foreign buys at RTGS$1,373.81 and
foreign sales were RTGS$2,080,563.62. Total trades were 207.

The All Share index retreated by a significant 2.70 points   to close at
121.56 points. NATFOODS  eased $1.400 to $5.6000, OLD MUTUAL LIMITED
dropped $0.1470 to close at $7.9996 and CASSAVA SMARTECH   traded $0.0980
weaker at $1.0027. Other counters to lose ground include NMB   which shed
$0.0195 to $0.2000 and AFRICAN SUN (ASUN.zw) was $0.0100 down at $0.1500.

On the upside; SIMBISA   added $0.0202 to $0.6500, CBZ  gained $0.0158 to
settle at $0.1758 and PROPLASTICS   was $0.0100 stronger at $0.2225. DELTA
also increased by $0.0078 to $2.2703 and OK ZIMBABWE  rose by $0.0040 to end
at $0.2105. 

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  Global Currencies & Equity Markets

South Africa

South Africa rand, stocks gain as trade optimism boost risk appetite

(Reuters) - South Africa’s rand strengthened on Wednesday as hopes of a
trade deal between the United States and China bolstered risk appetite
globally, while stocks also strengthened in line with global market
optimism.

At 1541 GMT the rand was 0.42 percent firmer at 14.1500 per dollar compared
with a close of 14.2100 in New York on Tuesday.

Demand for emerging-market currencies grew after the Financial Times
reported China and the U.S. had resolved most of the issues standing in the
way of a trade deal.

White House economic adviser Larry Kudlow said also on Tuesday China and the
United States expect to “make more headway” in trade talks this week.

The rand was hovering close to a one-month high of 14.0750 reached on
Tuesday after Moody’s struck a surprisingly positive note in a credit
opinion, following the agency’s decision on Friday to delay a review that
might have removed South Africa’s last investment-grade rating.

On the bourse, the markets gained with the Johannesburg All-Share index
rising 1.34 percent to 57,926 points while the Johannesburg Top-40 index was
up by 1.35 percent to 51,641 points.

“It’s all up, it’s up by 800 points. If there’s a deal, people that will
benefit are the emerging markets,” said Greg Davies, equities trader at
Cratos Capital.

Among the gainers were financial shares, with ABSA up 4.22 percent to 164,60
rand and Standard Bank closing up 2.09 percent to 194.61 rand.

In fixed income, the yield on the benchmark government bond due in 2026
added a single basis point to close at 8.53 percent. 

Egypt

Egypt foreign reserves rise to $44.11 bln at end-march -cbank

(Reuters) - Egypt’s net foreign reserves edged up to $44.11 billion at the
end of March from $44.06 bln the previous month, the central bank said on
Wednesday.

Egypt’s foreign reserves stood at $42.61 bln at the end of March 2018.  

       <mailto:info at bulls.co.zw> 

Asia

Asian shares near 8-month highs, U.S.-China talks in view

(Reuters) - Asian shares held near an eight-month peak on Thursday as
investors awaited developments on Sino-U.S. trade talks, with both sides
appearing closer to signing a deal and improved risk appetite weighing on
safe-haven assets like the yen.

MSCI’s broadest index of Asia-Pacific shares outside Japan took a breather
after five straight days of gains took it to its highest since late August.
Chinese shares started firm with the blue-chip index up 0.9 percent. Hong
Kong’s Hang Seng index was a tad softer.

Japan’s Nikkei nudged 0.2 percent higher to stay near a recent one-month
top.

U.S. data out on Wednesday showed services sector activity hit a more than
19-month low in March and private payrolls grew less than expected,
supporting the Federal Reserve’s move to suspend interest rate hikes this
year.

Investors are worried about a sharp slowdown in economic growth in the first
quarter.

“The focus will remain on the ongoing US-China trade negotiations and the
U.S. labour data on Friday,” Mapa added.

Risk sentiment this week was helped by media reports touting progress in
Sino-U.S. trade talks. Bloomberg reported on Thursday the U.S. wanted to set
a 2025 target for China to meet trade pledges.

The plan would see China committing to buy more U.S. commodities, including
soybeans and energy products, and allow full foreign ownership for U.S.
companies operating in China as a binding pledge.

On Wednesday, the Financial Times reported the United States and China were
closer to reaching a final trade agreement.

Investors are keen to see if the ongoing talks lead to an
earlier-than-anticipated meeting between U.S. President Donald Trump and his
Chinese counterpart Xi Jinping to sign an accord.

Overnight, Wall Street edged higher to extend a strong start to the quarter
as a rally among chipmaker shares provided a boost to the broader market.

The Dow rose 0.15 percent, while the S&P 500 gained 0.21 percent and the
Nasdaq 0.6 percent.

Moves in the currency market were miniscule after bigger swings overnight.
All the major currencies gained on the safe-haven yen with the
risk-sensitive Australian dollar touching a five-week high.

The greenback was subdued on Thursday, easing against a basket of currencies
to 97.051. The euro edged up to $1.1244, while reaching a two-week top on
the yen at 125.45.

Sterling gained to $1.3177 after British Prime Minister Theresa May held
talks with the opposition Labour party in a bid to break the Brexit deadlock
that may lead to a softer departure deal with the EU.

The lower house of Britain’s parliament late on Wednesday also narrowly
passed legislation which would force May to seek a delay to Brexit in order
to prevent the risk of leaving without a deal on April 12.

In commodity markets, spot gold nudged up to $1,292.21 per ounce.

U.S. crude eased 6 cents to $62.4 while Brent crude rose 1 cent to $69.32.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold gains on tepid dollar; focus on U.S.-China talks

(Reuters) - Gold gained on Thursday as the U.S. dollar traded close to its
one-week low posted in the previous session, while investors awaited
progress on the ongoing Sino-U.S. trade negotiations after reports showed
that both sides were nearing a deal.

Spot gold rose 0.2 percent to $1,292.24 per ounce as of 0537 GMT. U.S. gold
futures firmed 0.1 percent at $1,296.60 an ounce.

Gold is often seen as a safe investment during times of financial and
political uncertainties.

A pause in the equities rally also helped the bullion. Asian shares held
near an eight-month peak as investors awaited developments on trade talks.

Negotiations between the United States and China made “good headway” last
week in Beijing and the two sides aim to bridge differences during talks
this week, White House economic adviser Larry Kudlow said.

The dollar was trading near one-week low posted in the previous session
after data showed U.S. services sector activity hit a more than 19-month low
in March and private payrolls grew less than expected.

Market participants are now awaiting the U.S. nonfarm payrolls data, due on
Friday, as it would offer insights on the strength of the U.S. economy.

A weak payrolls data could further weigh on the U.S. unit, making dollar
denominated metals cheaper for investors holding other currencies.

On the technical front, as long as prices doesn’t break the $1,280 support,
gold will be broadly range bound between $1,280 and $1,320 price levels with
immediate resistance around $1,302, said Ajay Kedia, director at Kedia
Commodities in Mumbai.

Holdings in the world’s largest gold-backed exchange-traded fund, SPDR Gold
Trust, also fell for a third consecutive session on Wednesday. Holdings were
at their lowest level since Dec. 17 at 24.57 million ounces.

Among other precious metals, spot platinum rose the most in
more-than-two-years in the previous session to touch its highest level since
end-June 2018 at $879.03 an ounce.

The auto-catalyst metal was down 0.1 percent at $873.96 an ounce on
Thursday, while its sister metal palladium was up 0.2 percent at $1,407.85.

Silver was flat at $15.13 per ounce.

Base metals rise on optimism over trade talks, Chinese data

(Reuters) - Prices of copper and other industrial metals rose on Wednesday
as strong Chinese manufacturing data and reports of progress in U.S.-China
trade talks bolstered the demand outlook.

Copper also reflected indigenous leaders in Peru rejecting talks with the
government to end disruption at a major mine.

Benchmark copper on the London Metal Exchange (LME) closed up 1 percent at
$6,492 a tonne, near last month’s eight-month high of $6,555.50.

Metals prices have been stuck in a narrow range since late February, but
strong Chinese purchasing managers’ index (PMI) data and positive signals
from trade talks are lending support, BMO analyst Kash Kamal said.

CHINA ECONOMY: The Chinese Caixin/Markit composite manufacturing and
services PMI rose to a nine-month high in March, adding to signs that
stimulus is gradually kicking in.

China is the world’s largest consumer of metals.

TRADE TALKS: The United States and China expect to make more headway in
trade talks this week, White House economic adviser Larry Kudlow said.

“It’s a larger, grander discussion than anything we’ve had before in
U.S.-China trade relations, and there’s a certain amount of optimism,”
Kudlow said.

The dispute pushed metals prices sharply lower last year.

GLOBAL MARKETS/DOLLAR: World stocks rallied to six-month highs, while the
dollar weakened, helping metals by making them cheaper for buyers with other
currencies.

PERU: An indigenous community that has blocked roads to the copper mine has
decided not to negotiate with the government further until the group’s
lawyers are freed from jail.

The blockade has halted exports from Las Bambas, which produces about
400,000 tonnes of copper a year, accounting for about 2 percent of global
production.

COPPER SPREAD: Cash copper on the LME has flipped from a $70 premium to the
three-month contract last month to an $8 discount, suggesting a supply
shortage has eased. CMCU0-3

OUTLOOK: “The overall picture is of a (copper) market in significant surplus
and therefore lacking fundamental support in the first quarter of this
year,” Barclays analysts said in a note, pointing to a build-up in
inventories in China that has offset a decline in LME warehouses. CU-STX-SGH
MCUSTX-TOTAL

They said however that demand would likely improve, forecasting an average
copper price of $6,230 this year and $6,350 in 2020.

NORSK HYDRO: The company said it could take months to return its Karmoey
aluminium plant in western Norway to full capacity after a power outage that
cut production by about 10 percent.

OTHER METALS: LME aluminium ended up 0.4 percent at $1,896 a tonne, zinc
finshed 2.6 percent higher at $2,930, nickel gained 2.2 percent to $13,375
and lead rose 1.4 percent to $2,012. Tin bucked the trend, slipping 0.1
percent to $21,175.

INVESTORS DIARY 2019

Company

Event

Venue

Date & Time

Zimbabwe 

Independence Day

Zimbabwe

18 Apr 2019 

Good Friday

19 Apr 2019

Easter Saturday

20 Apr 2019

Easter Sunday

21 Apr 2019

Easter Monday

22 Apr 2019

Workers Day

01 May  2019

Africa Day

25 May 2019

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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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