Bulls n Bears Daily Market Commentary : 04 December 2019

Thu Dec 5 00:35:19 CAT 2019

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Bulls n Bears Daily Market Commentary : 04 December 2019

Zimbabwe Stock Exchange Update

Market Turnover ZWL$9,839,865.43 with foreign buys at ZWL$139,916.57 and
foreign sales were ZWL$1,415,660.90 Total trades were 215

The All Share index dropped 1.44 points  to close at 237.03 points. OLD
MUTUAL LIMITED  lost $0.2750 to end at $35.7260, BAT  was $0.2372 lower at
$49.7628 and ECONET WIRELESS  also decreased by $0.0938 to end at $1.4972.
AXIA CORPORATION  traded $0.0237 weaker at $0.7596 and OK ZIMBABWE

eased $0.0125 to end at $0.7875. 

Trading in the positive: EDGARS  gained $0.0120 to $0.1725, CASSAVA SMARTECH
LIMITED  rose by $0.0093 to $1.4741 and NMB   traded $0.0078 firmer at
$0.3678. AFRICAN SUN LIMITED  also gained $0.0066 to end at $0.4066 and
INNSCOR AFRICA  traded $0.0032 stronger at $3.7587.

  Global Currencies & Equity Markets

Uganda

Ugandan shilling unchanged, commodity flows to lend support

(Reuters) - The Ugandan shilling        was unchanged on Wednesday, and was
expected to firm on the back of dollar inflows from exporters of commodities
like coffee and gold and some charities. 

At 0729 GMT, commercial banks quoted the shilling at 3,685/3,695, the same
level as Tuesday's close.   

Kenya

Kenyan shilling firms on tight liquidity, offshore investor flows

(Reuters) - The Kenyan shilling strengthened against the dollar on Wednesday
supported by tight liquidity conditions in the local money market and
inflows from offshore investors buying stocks and government debt, traders
said.

At 0703 GMT, commercial banks quoted the shilling at 102.10/30 per dollar,
compared with 102.25/45 at Tuesday's close.   

       <mailto:info at bulls.co.zw> 

GLOBAL MARKETS

Stocks rally on renewed trade talk optimism, yields rise

(Reuters) - Government debt yields and a gauge of global equity markets rose
on Wednesday as sentiment improved after U.S. President Donald Trump said
trade talks with China were going “very well” and a news report suggested
key differences were being ironed out.

European stocks rallied, with the blue-chip Euro STOXX 50 , Germany’s DAX
and French CAC 40 gaining more than 1%. The news reversed overnight losses
in Asia when investors remained jittery over the prolonged talks.

The safe-haven yen and Swiss franc fell as Trump’s encouraging comments on
the U.S.-China trade negotiations boosted “risk-on” sentiment.

The dollar index fell after the Institute for Supply Management (ISM)
reported activity in the U.S. services sector slowed more than expected in
November amid lingering concerns about trade tensions and worker shortages.

The poor ISM reading failed to slow the equity rally because the underlying
economic data overall is getting better, said Jim Paulsen, chief investment
strategist at The Leuthold Group in Minneapolis.

Trump, who on Tuesday had roiled markets after he raised the prospect of
extended U.S.-Sino trade tensions, told reporters at a meeting of NATO
leaders near London that “discussions are going very well and we’ll see what
happens.”

The market is now focused on Dec. 15, when new U.S. tariffs on Chinese
imports are scheduled to take effect. Nobody knows whether Trump is serious
about going forward with the tariffs or if the date is a bargaining chip,
said David Lafferty, chief market strategist at Natixis Investment Managers.

Market sentiment rebounded earlier when Bloomberg reported that the two
sides were closer to agreeing on how many tariffs would be rolled back in a
“phase one” trade deal.

MSCI’s gauge of equity performance in 49 countries gained 0.47% while stocks
on Wall Street also rose, snapping a three-day losing streak.

The Dow Jones Industrial Average rose 146.97 points, or 0.53%, to 27,649.78.
The S&P 500 gained 19.56 points, or 0.63%, to 3,112.76 and the Nasdaq
Composite added 46.03 points, or 0.54%, to 8,566.67.

Investors also shrugged off a survey showing U.S. private-sector job growth
unexpectedly slowed to its weakest pace in six months in November as goods
producers and construction companies cut jobs.

Paulsen said the ADP National Employment Report is not that closely
correlated with the payrolls data compiled by the U.S. Labor Department,
which will release its November report on Friday. A slowdown in jobs
creation in a tight labor market is understandable, he also said.

Yields on benchmark U.S. and euro zone government debt rebounded, with the
10-year U.S. Treasury note falling 18/32 in price to push its yield up to
1.7723%.

The 10-year German bund’ s yield rose about 3 basis points to -0.316% and
yields across the euro area followed suit, rising by 2 to 3 basis points.

The dollar index fell 0.12%, with the euro down 0.04% to $1.1077. The
Japanese yen weakened 0.22% versus the greenback at 108.88 per dollar.

Oil prices jumped ahead of an expected extension to production curbs by the
Organization of the Petroleum Exporting Countries and its allies. More
support came from industry data showing a larger-than-forecast drop in U.S.
crude stockpiles.

U.S. crude rose $2.33 to settle at $58.43 a barrel. Brent crude futures
settled up $2.18 at $63.00 a barrel.

Renewed hopes over the trade talks prompted gold to erase earlier gains.
U.S. gold futures settled 0.3% lower at $1,480.20 an ounce.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Copper prices rise on trade deal prospects

(Reuters) - Copper rose on Wednesday on reports of progress towards an
initial U.S.-China trade deal, though gains were capped by scepticism in
some quarters. 

Bloomberg reported that the United States and China were moving closer to
agreeing on the amount of tariffs to be rolled back in a "phase one" trade
deal and U.S. President Donald Trump said talks were going well.

This was a more positive tone than his comments the previous day, when Trump
warned that a deal may not be possible until late next year, pushing copper
prices to their lowest in almost three weeks.                         

Benchmark copper prices on the London Metal Exchange (LME)        ended 1.2%
higher at $5,886 a tonne after shedding 1.1% in the previous session.

The LME index         hit its lowest in three months, putting it within
striking distance of the weakest since mid-2017.

TRADE: Progress in talks bodes well for metals demand, particularly for
copper, which is usually viewed as a gauge for economic health. China
accounts for about half of metals demand.

INVENTORIES: Copper stocks in LME-registered warehouses fell to their lowest
in nearly seven months, shedding 1,100 tonnes to 114,000 tonnes. 

MCUSTX-TOTAL

However, spreads were unaffected by LME supply tightness, with the discount
between LME cash copper and the three-month contract deepening to $25 a
tonne from $7.50 nearly a month ago CMCU0-3.

SCRAP: China has issued a seventh batch of import quotas for scrap metal,
including 17 quotas for a total of 7,970 tonnes of high-grade copper scrap,
ccording to a notice from a unit of the environment ministry.              

RIO TINTO: Miner Rio Tinto         said it would spend $1.5 billion to
expand its Kennecott copper project in Utah, United States.

COBALT: South Korean battery maker SK Innovation             signed a
six-year deal to buy up to 30,000 tonnes of cobalt from Glencore , allowing
it to produce batteries for 3 million electric vehicles.             

NICKEL SUPPLY: Brazil's Vale SA plans to exit its troubled New Caledonia
assets but still aims to ramp up nickel output ahead of rising demand for
electric batteries, executives said on Wednesday.             

COLUMN: Copper smelters feel the squeeze as mine supply falters.

PRICES: LME aluminium slipped 0.5% to $1,758 a tonne, zinc rebounded from a
four-month low in the previous session, gaining 2% to $2,245, while lead
edged up 1.2% to $1,922. Tin was unchanged at $16,750 and nickel lost 1.9%
to $13,120.

Gold miners flash the cash in biggest deal binge in a decade

(Reuters) - Gold miners look set to extend a deal spree after notching
transactions worth a record $30.5 billion this year, according to data, the
biggest M&A binge since bullion prices peaked nearly a decade ago.

Led by top producers Newmont Goldcorp Corp and Barrick Gold Corp, miners are
bulking up to replace dwindling reserves and win back investors who in
recent years shunned the sector because of disappointing returns.

This year has seen 348 deals worth more than $30.5 billion, including net
debt, according to Refinitiv Eikon data.

That is up from $10.8 billion last year and surpasses a previous high of
$25.7 billion set in 2010, the data show. Gold topped $1,900 per ounce in
2011 and currently trades around $1,484, after hitting a six-year high in
September.

The 2011 gold boom prompted buyers to overspend on acquisitions, leading to
billions in impairments when prices crashed in subsequent years. This time,
investors say acquirers are being more cautious.

The premiums linked to recent gold transactions are far below those paid in
the previous price boom, when 40% to 50% premiums were not uncommon.

Gold investor group Paulson in September urged the smaller gold miners to
seek nil-premium mergers to eliminate duplication and lower costs.

Barrick paid no premium when it bought Africa’s Randgold last year while
Newmont offered an 18% premium when it snapped up Goldcorp to create the
world’s largest gold miner.

More deals are likely among mid-tier miners, who face pressure from activist
investors to lower costs and financing constraints, said Peter Grosskopf,
CEO of precious metals-focused fund manager Sprott Inc..

In a flurry of deals this week, Canada’s Endeavour Mining Corp made a $1.9
billion all-stock takeover proposal for Africa-focused Centamin Plc.

A day earlier, China’s Zijin Mining Group Co Ltd struck a deal to buy
Continental Gold Inc for $1.3 billion in cash.

In November, Kirkland Lake Gold Ltd. bid C$4.3 billion for Detour Gold while
Australia’s Saracen Mineral Holdings Ltd. snapped up Barrick’s stake in
Super Pit gold mine in Australia.

Pretium Resources Inc, Pure Gold Mining Inc , Roxgold Inc and Silvercrest
Metals Inc are among possible targets, according to industry sources.

Canadian miner Iamgold Corp has drawn interest from state-backed China Gold
International Resources Corp Ltd .

Gold miners have also boosted returns to shareholders, with Barrick,
Kirkland Lake Gold and Yamana Gold hiking payouts on the back of revenues
boosted by higher gold prices.

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
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