Bulls n Bears Daily Market Commentary : 05 August 2019

Tue Aug 6 03:58:05 CAT 2019

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Bulls n Bears Daily Market Commentary : 05 August 2019

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Zimbabwe Stock Exchange Update

Market Turnover ZWL$ 10,153,832.84 with foreign buys at ZWL$ 4,030,260.00
and foreign sales were ZWL$ 1,600,480.00 Total trades were 98.

The All Share index lost 0.47 points to close at 184.16 points. SIMBISA lost
$0.0296 to end at $0.9204, ECONET WIRELESS LIMITED  dropped $0.0198 to trade
at $1.5377 and EDGARS STORES fell by $0.0087 to settle at $0.1513. Other
losses were in INNSCOR AFRICA which reduced by $0.0075 to $2.1875 and
CASSAVA SMARTECH ZIMBABWE LIMITED  went down by $0.0068 to close at $1.4826.

Trading in the positive: OLD MUTUAL was leading with a $0.2455 gain to close
at$17.5984, NMB added $0.0027 to settle at $0.2650 and SEEDCO INTERNATIONAL
rose by $0.0012 to close at $2.1224. AXIA traded $0.0002 higher at $0.4801. 

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  Global Currencies & Equity Markets

Nigeria

Nigeria's Access, Union Bank tap local bond market as yields fall

(Reuters) - Nigeria’s Access Bank and Union Bank have each issued a 30
billion naira ($98.09 million) bond taking advantage of falling yields on
the local currency debt market, banks leading the bond sales said on Monday.

Access Bank sold a seven-year bond at a 15.5% yield, while mid-tier rival
Union priced its 10-year bond to yield 16.2%. Union’s sale is part of a 100
billion naira debt issuance programme.

Yields in Nigeria’s local currency bond market have dropped from a high of
18% since the government redeemed some of its treasury bills in 2017 to
lower borrowing costs. Yields on the one-year treasury bill were last
auctioned at around 11%.

Union and Access Bank, which merged with mid-tier Diamond Bank in April, did
not say how they would use the proceeds of the bond sales.

Nigeria’s central bank has said it would pursue a recapitalisation of the
banking sector over the next five years after a series of currency
devaluations weakened banks’ capital.

Fidelity Bank told Reuters last month it aimed to sell up to 50 billion
naira in Tier II debt before the second quarter of next year to refinance
existing bonds as yields decline.

The central bank has been pushing banks to lend to businesses and consumers
to help revive the economy where growth rates remain low after a recent
recession.

The bank has curbed a frequent sale of open market bills, which has also
helped to drive yields in the local currency debt market lower.

The central bank had been tightening liquidity to curb inflation and attract
foreign investors into bonds to support the naira. But in a surprise change
of stance in March, the bank cut interest rates by 50 basis points for the
first time since November 2015.

It subsequently kept rates on hold at 13.5% last month. ($1 = 305.85 naira) 

Kenya

Kenyan shilling holds steady against the dollar

(Reuters) - The Kenyan shilling held steady against the dollar on Monday
with inflows from diaspora remittances and offshore investors buying
government debt

helping ease pressure from excess liquidity in the local money markets,
traders said.

At 0706 GMT, commercial banks quoted the shilling at 102.95/103.15 per
dollar, compared with 103.00/20 at Friday's close. 

       <mailto:info at bulls.co.zw> 

America

Emerging debt, stocks suffer biggest daily outflows of 2019 on Friday -IIF

(Reuters) - Emerging market debt and equities suffered their biggest
outflows of 2019 on Friday with hefty losses continuing on Monday amid a
sharp escalation of Sino-U.S. trade tensions, data from the Institute of
International Finance showed (IIF).

Analysing high frequency data from local stock exchanges and debt offices,
the IIF, found that $2.33 billion of portfolio money had been pulled from
developing bond and stock markets on Friday - the largest daily outflows of
the year.

Meanwhile, partial flow data for Monday showed that developing fixed income
and equities had hemorrhaged another $1.43 billion already even before
trading in the Americas was added.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold soars 2% as trade worries trigger flight to safety

(Reuters) - Gold surged 2% on Monday to its highest level in more than six
years as a worsening U.S.-China trade conflict prompted investors to dump
riskier assets for safe havens, with a weaker dollar supplying additional
fuel for bullion’s run.

Spot gold was up 1.7% at $1,464.72 per ounce as of 1:33 p.m. EDT (1733 GMT),
after hitting its highest level since May 2013 at $1,469.60. U.S. gold
futures settled 1.3% up at $1,476.50.

In the latest flare-up in a long-drawn trade spat, China on Friday said it
would fight a decision by U.S. President Donald Trump to slap an additional
10% tariff on $300 billion worth of Chinese imports.

Trump’s tariffs on China may force the U.S. Federal Reserve to cut interest
rates more than it had hoped was necessary to protect the economy from
trade-related risks.

The dollar slipped to near a two-week low against key rivals, making bullion
cheaper for investors holding other currencies, but rose against the Chinese
yuan. Trade worries also drove a sell-off in global stock markets.

China let its yuan weaken below the seven-per-dollar level on Monday, an
11-year low, while the offshore yuan fell to its weakest since international
trading of the Chinese currency began.

The Shanghai Gold Exchange said it would raise the margin requirement on its
AU(T+N2) gold contract. The trading limit on the contract would also be
raised.

In India, gold imports for July plunged 55% from a year ago to the lowest
level in three years as local prices jumped to a record high.

Meanwhile, holdings in the world’s largest gold-backed exchange-traded fund,
SPDR Gold Trust, rose to 830.76 tonnes on Friday.

Among other metals, silver rose 1.1% to $16.39 per ounce. Platinum was up
1.4% to $854.49 per ounce, while palladium rose nearly 1.3% to $1,424.06 per
ounce.

Copper hits two-year low as U.S.-China trade war escalates

(Reuters) - Copper prices fell to their lowest in more than two years on
Monday, hit by the escalating trade dispute between the United States and
China, while nickel prices climbed on concern over supplies from Indonesia.

Benchmark copper on the London Metal Exchange ended 0.8% down at $5,685 a
tonne. Prices of the metal used widely as a gauge of economic health earlier
hit $5,640 a tonne, its lowest since June 2017.

TRADE: U.S. President Donald Trump last week said the United States would
impose more tariffs on Chinese imports, while China vowed to fight back,
ending a month-long trade truce between the world’s two biggest economies.

China consumes about half of the world’s supply of industrial metals.

YUAN: China has also allowed the yuan to breach the key 7 per dollar level
for the first time in more than a decade, in a sign Beijing might be willing
to tolerate more currency weakness that could further inflame the trade
conflict.

NICKEL: Prices of the stainless steel ingredient hit a two-week high at
$14,970 a tonne on the LME, while on the Shanghai Futures Exchange they
touched a four-year high.

The latest trigger is supply risk from Indonesia.

Three-month nickel ended 3% up at $14,880 a tonne.

INDONESIA: Throughout 2017, Indonesia issued permits to export more than 22
million tonnes of nickel ore.

Permits typically stand for one year and companies are allowed to renew
them. Under current rules, no unprocessed ore exports will be allowed after
January 2022.

PRICES: Aluminium finished down 0.4% at $1,763 a tonne, zinc slid 1.7% to
close at $2,311, lead gained 0.1% to $1,954 and tin dropped 0.4% to
$16,905..

INVESTORS DIARY 2019

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
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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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