Bulls n Bears Daily Market Commentary : 16 August 2019

Mon Aug 19 04:34:00 CAT 2019

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Bulls n Bears Daily Market Commentary : 16 August 2019

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Zimbabwe Stock Exchange Update

Market Turnover ZWL$ 5,144,396.00 with foreign buys at ZWL$ 2,552,859 and
foreign sales were ZWL$ 1,857,690.20 Total trades were 113.

The All Share index retreated by 0.94 points to close at 179.63 points as
heavyweight counters lost ground. CASSAVA SMARTECH dropped $0.0395 to end at
$1.2943, ECONET WIRELESS eased $0.0283 to $1.3000 and PADENGA decreased by
$0.0070 to settle at $1.8000.

Trading in the positive; OLD MUTUAL LIMITED added $0.2222 to settle at
$21.7222, PPC gained $0.1099 to close at $2.1000 and SEEDCO INTERNATIONAL
LIMITED   was $0.0250 stronger at $2.1500. ZPI increased by $0.0029 to close
at $0.0280 and BINDURA traded $0.0025 firmer at $0.1100.

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  Global Currencies & Equity Markets

Kenya, Tanzania shillings, Zambia kwacha to hold steady

(Reuters) - Kenya's and Tanzania's shillings are expected to hold steady
against the dollar in the next week to Thursday, as will Zambia's kwacha,
traders said.

KENYA

The Kenyan shilling        is expected to be stable,  supported by inflows
from offshore investors buying government debt and tightening liquidity in
the local money market, traders said. 

Commercial banks quoted the shilling at 103.15/35, compared with 103.00/20
at last Thursday's close. 

TANZANIA

The Tanzanian shilling        is expected to hold steady, with dollar demand
from the energy and manufacturing sectors being matched by inflows from the
tourism and agriculture sectors.

Commercial banks quoted the shilling at 2,293/2,303, the same level as last
Thursday's close.. 

UGANDA

The Ugandan shilling        is seen trading stable over the next few days
after the central bank's decision to leave its benchmark lending rate
unchanged. 

Commercial banks quoted the shilling at 3,690/3,700, unchanged from last
Thursday's closing level. 

On Thursday the central Bank of Uganda left its benchmark rate unchanged at
10 percent amid low inflation.             

ZAMBIA

The kwacha        is next week expected to remain range-bound due to tight
liquidity in the money markets.

Commercial banks quoted the currency of Africa's second-largest copper
producer at 13.0200 per dollar from a close of 13.0000 a week ago.

South Africa's rand firms as investors await next bout of weakness

(Reuters) - South Africa’s rand was firmer early on Friday, adding to the
previous session’s gains in a recovery driven mainly by investors covering
their short positions in anticipation of sharper falls as local and global
growth fears loom.

At 0650 GMT the rand was 0.57% firmer at 15.1925 per dollar compared with a
close of 15.2800 overnight in New York, bringing gains to more than 1.5%
since Wednesday when the currency tumbled to just short of 11-month lows.

The rand has fallen more than 9% since the beginning of August, pressured by
the rising likelihood of a credit ratings downgrade by linked to massive,
additional bailout to state power firm Eskom and, this week, by signs of a
slower global growth.

With fundamentals and sentiment pointing to further rand weakness, many
traders see a short term rally, with buyers coming in at current prices
before the next tranche of losses.

Bonds also firmed, with the yield on the benchmark 10-year government paper
due in 2026 down 4 basis points to 8.395%.

       <mailto:info at bulls.co.zw> 

America

Dollar firms, stocks soar on ECB rate cut expectations

(Reuters) - U.S. and European stocks surged on Friday on expectations the
European Central Bank will cut interest rates but the dollar pared gains
against the euro after a report said the German government was prepared to
take on new debt to lift the economy.

The dollar hit a two-week high against the euro as expectations of ECB
stimulus weighed on the single currency and bullish data showing a jump in
U.S. homebuilding permits to a seven-month high also helped lift the
greenback.

But German and other euro zone government bond yields rose late Friday on a
Der Spiegel report. Borrowing costs had plumbed new lows throughout the week
as investors unnerved by the prospect of European recession piled into safer
assets.

The euro rebounded to pare most losses after Der Spiegel magazine said the
German government would be prepared to ditch its balanced budget rule and
take on new debt to counter a possible recession.

Germany’s Finance Ministry declined to comment on the report.

There has been a rising drumbeat of news recently from German politicians
and businesses calling for a stimulus program, said Karl Schamotta, director
of global markets strategy at Cambridge Global Payments in Toronto.

The German 10-year bund yield rose to a negative 0.688%, having earlier hit
a record low of negative 0.727%. Rates turned negative in March and have
trended lower since May.

The rebound in equity markets buoyed investor sentiment, though it is hard
to say the recent rout has found a floor despite cheaper prices, said Yousef
Abbasi, global market strategist at INTL-FCStone Financial in New York.

U.S. banks are likely to get cheaper because European banks are likely to do
so if the ECB does not put together a credible off-set plan for further
negative rates for banks, he said.

Technology shares led Wall Street’s advance but U.S. stocks posted a third
straight week of declines, battered by the U.S.-China trade row and an
“inversion” of 2- and 10-year bond yields that sparked fears of a recession.

MSCI’s gauge of stock performance in 47 countries gained 1.18% and its
emerging market rose 0.69%. In Europe, the FTSEurofirst 300 index of leading
regional shares closed 1.23%.

The Dow Jones Industrial Average rose 306.62 points, or 1.2%, to 25,886.01.
The S&P 500 gained 41.08 points, or 1.44%, to 2,888.68 and the Nasdaq
Composite added 129.38 points, or 1.67%, to 7,895.99.

The euro earlier slid to $1.1090, shy of a two-year low it set two weeks
ago, on reports the ECB’s Olli Rehn had suggested Thursday that a
significant easing package was needed in September.

The dollar index rose 0.06%, with the euro down 0.15% to $1.1089. The
Japanese yen weakened 0.23% versus the greenback at 106.35 per dollar.

The German 10-year bund posted a fifth straight week of declines, Italy’s
10-year bond yield set its biggest weekly fall since late 1997 and the
decline in Spanish 10-year yields were the largest since at least 1994.

The benchmark 10-year U.S. Treasury notes fell 9/32 in price to push yields
up to 1.5589%.

Crude oil prices recovered from two days of declines after data on Thursday,
showing a rise in U.S. retail sales, helped ease recession concerns. A
bearish outlook from OPEC capped gains.

Brent crude rose 41 cents to settle at $58.64 a barrel while U.S. crude
settled 40 cents higher at $54.87 a barrel.

U.S. gold futures settled down 0.5% at $1,523.60 an ounce.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Japan aluminium stocks rise 2.9% m/m in July - Marubeni

(Reuters) - Aluminium stocks held at three major Japanese ports AL-STK-JPPRT
at the end of July rose 2.9% to 308,800 tonnes from the previous month,
Marubeni Corp said on Friday.

Marubeni collects data from the ports of Yokohama, Nagoya and Osaka.

Gold falls 1% as equities rise, but eyes 3rd weekly gain

(Reuters) - Gold fell 1% on Friday hurt by an uptick in equity markets and
the dollar, but fears of a slowing global economy and lack of clarity on the
U.S.-China trade war kept bullion above the $1,500 level, putting it on
track for a third straight weekly gain.

Spot gold was down 1% at $1,508 per ounce as of 11:10 a.m. EDT (1510 GMT),
but is up 0.7% so far this week.

U.S. gold futures fell 0.8% to $1,518.50.

Hopes of more official stimulus for the economy and the easing of a bond
market rally drove a broad rise in U.S. stocks on Friday, as a bruising week
for markets drew to a close.

Meanwhile, the dollar index, which measures the greenback against a basket
of six major currencies, was up 0.1% having hit a two-week high.

Bullion has risen more than $100 since the beginning of the month amid
falling global bond yields, heightened trade tensions and a slew of
disappointing economic data globally.

Earlier this week, 10-year Treasury yields dropped below the two-year yield
for the first time in 12 years. Curve inversion is widely considered a
warning that the economy is headed for recession.

On the trade front, U.S. President Donald Trump said on Thursday he believed
China wanted to make a trade deal and that the dispute would be fairly
short.

This comes after Beijing vowed to counter the latest tariffs on Chinese
goods but called on Washington to meet it halfway on a potential deal.

Investors will now focus on the Federal Reserve’s annual symposium next week
for further hints on monetary easing.

On the technical side, spot gold may fall into a range of $1,483-$1,503 per
ounce, according to Reuters technical analyst Wang Tao.

Elsewhere, silver fell 1% to $17.09 per ounce, but was on track for a second
consecutive weekly gain.

Platinum rose 0.2% to $840.43 an ounce, while palladium rose 0.4% to
$1,450.7 an ounce.

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
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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