Bulls n Bears Daily Market Commentary : 28 August 2019

Thu Aug 29 03:17:11 CAT 2019

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Bulls n Bears Daily Market Commentary : 28 August 2019

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Zimbabwe Stock Exchange Update

Market Turnover ZWL$ 14,487,273.77 with foreign buys at ZWL$1,196,170.60 and
foreign sales were ZWL$ 2,129,597.20 Total trades were 197.

The All Share index lost 4.52 points to close at 167.26 points. BRITISH
AMERICAN TOBACCO retreated $4.0108 to $30.0000, OLD MUTUAL LIMITED  dropped
$0.6048 to settle at $17.8952 and SIMBISA  was $0.0972 lower at $0.6004.
DELTA also decreased by $0.0957 to end at $3.1027 and CASSAVA SMARTECH
traded $0.0633 lower at $1.2281.

Losses were offset by gains in TSL  which added $0.0525 to $0.7525, ZBFH
added $0.0200 to $0.6200 and PADENGA was $0.0049 firmer at $1.6500. WILLDALE

also increased by $0.00200 to $0.0480 and DAWN was $0.0018 stronger at
$0.0480.

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  Global Currencies & Equity Markets

South Africa

South Africa's rand dips as investors tread cautiously, stocks up

(Reuters) - South Africa’s rand slowed slightly on Wednesday as traders
continued to tread cautiously with an eye on global developments, while
stocks strengthened.

At 1523 GMT the rand was 0.16% weaker at 15.360, barely moved from its
overnight close after some demand from exporters saw it stretch to a session
best 15.2350.

The currency has struggled for momentum in either direction this week with a
lull in local political developments offsetting the swings in the trade spat
between Washington and Beijing.

With technical resistance below 15.20 remaining elusive and support at 15.50
equally far-off, the rand is set to be driven by month-end flows before
fundamentals kick in next week with a batch of key data releases including
second quarter growth figures.

In fixed income, bonds were also marginally firmer, with the yield on the
benchmark 10-year government issue sliding 0.25 basis points to 8.195%.

On the bourse, stocks strengthened with the broader All-share index up 0.67%
to 54,256 points, while the Top-40 rose 0.58% to 48,429 points.

South African pharmaceutical firm Adcock Ingram Holdings Ltd rose 4.86% to
58.20 rand after reporting a 10.6% rise in full-year earnings and the
disposal of its investment in Ghana. Further gains were seen in the platinum
sector , up 4.67%, boosted by an increase in the platinum spot price .

Anglo American Platinum gained 5.76% to 894.27 rand and Impala Platinum rose
4.07% to 83.37 rand. 

Kenya

Kenyan shilling under pressure amid end month dollar demand

(Reuters) - The Kenyan shilling was under pressure against the dollar on
Wednesday due to increased end month dollar demand from the energy and
manufacturing sector amid excess money market liquidity, traders said. 

At 1003 GMT, commercial banks quoted the shilling at 103.35/55 per dollar,
compared with 103.30/50 at Tuesday's close.

       <mailto:info at bulls.co.zw> 

America

Stocks rise as recession, trade worries ebb; sterling tumbles

(Reuters) - A gauge of equities worldwide rose on Wednesday as data showing
strong demand for oil helped subdue recession jitters, while sterling
tumbled as Britain’s prime minister moved to suspend parliament before the
country’s planned departure from the European Union.

The MSCI All-Country World Index rose 0.31% as U.S. stocks advanced, though
the pan-European STOXX 600 ended 0.2% lower. Safe-haven assets such as gold
and the Japanese yen fell, though not far from recent highs.

Data showing a drop in U.S. crude stockpiles lifted oil prices. The sign of
healthy demand quelled to some extent the fears of a severe economic
downturn prompted by the inversion of the U.S. Treasury yield curve, which
has historically been a highly accurate predictor of a U.S. recession.

U.S. crude settled 1.55% higher to $55.78 per barrel and Brent settled at
$60.49, up 1.65% on the day.

Along with the oil inventory data, a respite from negative developments in
U.S.-China trade relations helped equities advance, several market watchers
said. Earlier, stocks had been pressured by concerns about the possibility
of economic disruption from a no-deal Brexit.

Worries over Brexit, however, led to a sharp decline in the British pound.
Sterling was last down 0.59% against the dollar at $1.2214 after Prime
Minister Boris Johnson set Oct. 14 as the date for the formal state opening
of a new session of parliament. The opening limits the time the parliament
would sit before the planned date for Brexit on Oct. 31.

On Wall Street, the Dow Jones Industrial Average rose 258.2 points, or 1%,
to 26,036.1, the S&P 500 gained 18.78 points, or 0.65%, to 2,887.94 and the
Nasdaq Composite added 29.94 points, or 0.38%, to 7,856.88.

Demand for Treasuries remained robust during a $41 billion auction of
five-year government debt on Wednesday. Yields on 30-year U.S. Treasuries
touched all-time lows earlier in the session and were below those of 3-month
bills . The 30-year yield also fell below the S&P 500 dividend yield for the
first time since March 2009. The yield curve between 2-year and 10-year
notes remained inverted.

Benchmark 10-year Treasury notes last rose 6/32 in price to yield 1.4693%,
from 1.49% late on Tuesday.

In currencies, the dollar index rose 0.25%. The Japanese yen weakened 0.40%
versus the greenback at 106.18 per dollar but remained close to its
2-1/2-year high of 104.44 hit on Monday.

Among commodities, spot gold dropped 0.21% to $1,539.10 an ounce, though not
far off its six-year peak touched on Monday.

Spot silver added 1.04% to $18.35 an ounce after having hit $18.50, its
highest level since April 2017.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold holds near 6-year peak on slowdown fears, trade jitters

(Reuters) - Gold held close to a more than six-year high on Wednesday, after
rising more than 1% in the previous session, as fears of a possible
recession and the trade conflict between China and the United States drove
investors to safe haven assets.

Spot gold was flat at $1,542.33 per ounce as of 1222 GMT. On Monday it
touched $1,554.56, its highest since April 2013.

U.S. gold futures were up 0.2% at $1,555.

While there are expectations for monetary policy easing in the euro zone,
inversion in U.S. Treasury yield curve increased hopes for further rates
cuts by the U.S. central bank, he added.

Gold rose more than 1% on Tuesday as an inversion in the U.S. yield curve
and disappointing U.S. economic data rekindled fears of a recession amid
uncertainties around the trade dispute.

“People are beginning to think that the economy is not doing that well,
there could be a possible recession, or more likely, a slowing economy,
which means the Federal Reserve will have to cut rates and that supports
gold,” said John Sharma, an economist with National Australia Bank.

Federal funds futures implied traders saw a 91% chance of a 25 basis-point
rate cut by the U.S. central bank next month.

Meanwhile, U.S. President Donald Trump on Monday predicted a trade deal with
China but optimism wilted after China’s foreign ministry spokesperson
dismissed claims of phone calls between the two sides.

On the technical front, bullion’s 14-day relative strength index (RSI) was
around 70, indicating that the commodity was approaching overbought
territory.

Elsewhere, spot silver jumped 1.5% to $18.44 an ounce, having touched
$18.50, its highest level since April 2017.

Spot platinum climbed 0.7% to $871.60 an ounce, after touching its highest
in nearly a month, while palladium slipped 0.8% to $1,469.51.

Copper prices ease amid global economic uncertainties

(Reuters) - London copper prices dipped on Wednesday, as the lack of any
clear moves to resolve the protracted U.S.-China trade conflict weighed on
the demand outlook for the red metal.

China’s foreign ministry reiterated on Tuesday that it had not heard of any
recent telephone call between the United States and China on trade, and said
it hopes Washington can stop its wrong actions and create conditions for
talks.

FUNDAMENTALS

* COPPER: Three-month copper on the London Metal Exchange edged down 0.3% to
$5,669 a tonne by 0710 GMT, while the most-traded copper contract on the
Shanghai Futures Exchange advanced 0.5% to 46,560 yuan ($6,564.40) a tonne.

* PRICES: London zinc fell 0.2%, lead decreased 0.5%, aluminium edged down
0.1%, while nickel advanced 0.8%. Shanghai aluminium rose 0.3%, zinc
increased 1.3% and lead rose 1.6%.

* ZINC: “The prospect of increase in supply contrasts starkly to a sluggish
demand both in China and around the globe. Price consolidation may still
last for a while before finding a cost support,” said analyst Helen Lau of
Argonaut Securities.

* CHALCO: Aluminum Corp of China Ltd,, known as Chalco, said on Tuesday its
revenue rose 15.2% despite a 10% drop in the primary aluminium segment.

* NICKEL: Rapidly rising use of nickel in the batteries that power electric
vehicles over coming years means higher prices are needed to incentivise the
development of new projects to boost supplies of the metal.

* CHINA RATES: Deteriorating Sino-U.S. trade ties and interest rate reforms
are fuelling speculation China will start cutting key rates from next month,
but bankers expect borrowing costs to come down only gradually.

* RARE EARTH: The U.S. Department of Defense is in talks with Australia to
host a facility that would process rare earth minerals, part of an effort to
reduce reliance on China, a senior American official said.

INVESTORS DIARY 2019

Company

Event

Venue

Date & Time

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been compiled from sources believed to be reliable, but no representation or
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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
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for guideline purposes only and sourced from third parties.

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