Bulls n Bears Daily Market Commentary : 11 December 2019

Thu Dec 12 09:05:49 CAT 2019

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Bulls n Bears Daily Market Commentary : 11 December 2019

Zimbabwe Stock Exchange Update

Market Turnover ZWL$15,128,008.36 with foreign buys at ZWL$288,356.28 and
foreign sales were ZWL$1,280,425.50 Total trades were 176

The All Share index advanced by 0.66 points  to close at 231.99 points. OLD
MUTUAL LIMITED gained $0.1187 to close at $35.4994, AFRICAN DISTILLERS
LIMITED  added $0.0500 to close at $3.1000 and DELTA CORPORATION rose by
$0.0335 to close at $3.4675. FIRST MUTUAL LIMITED advanced by $0.0300 to
close at $0.2700 while ECONET WIRELESS increased by $0.0239 to close at
$1.4801.

Negative end were in POWERSPEED  which eased $0.0500 to close at $0.2600,
PADENGA HOLDINGS which traded $0.0332 lower to end at $2.5000 and INNSCOR
AFRICA  which lost $0.0317 to close at $3.7177. PROPLASTICS LIMITED  dropped
$0.0150 to end at $0.8200 while ZIMRE PROPERTY INVESTMENTS LIMITED eased
$0.0090 to close at $0.0560.

  Global Currencies & Equity Markets

South Africa

South African rand firmer after data shows slowing inflation

(Reuters) - South Africa’s rand strengthened against the dollar on Wednesday
on optimism the central bank has room to boost the economy after consumer
inflation fell to a nine-year low, while stocks gained.

At 1549 GMT, the rand traded at 14.7380 per dollar, 0.35% stronger, a chunk
of those gains coming after the data showed the rise in November consumer
prices slowed to 3.6% year on year from a 3.7% annual rise in October.

The subdued price growth reignited bets the Reserve Bank (SARB) may reduce
rates after keeping them on hold at 6.5% in November.

With companies struggling to eke out profits as strained consumers cut
spending and face a weak growth outlook and continued political uncertainty,
monetary stimulus by a typically cautious central bank may be the only
short-term solution the country has.

Lower inflation against relatively high interest rates marginally supports
the rand’s carry yield attraction, but with chances diminishing that U.S.
benchmark rates will go lower and credit rate risk rising locally, the
rand’s gains could be short-lived.

The currency pulled back from a session low of 14.8170 registered in early
trade in the wake of the country’s most severe blackouts in a decade.

On Wednesday, President Cyril Ramaphosa said state utility Eskom will work
to stabilise the national power grid by the end of March.

In fixed income, the yield on the benchmark government paper due in 2026 was
up 1 basis point to 8.380%.

Stocks rose alongside emerging market shares ahead of the conclusion of a
U.S Federal Reserve policy meeting and after the local consumer inflation
data.

The benchmark JSE Top-40 Index was up 0.63% at 49,537 points while the
broader All-Share Index rose 0.63% to 55,766 points.

Miners topped the Top-40 index on the back of stronger gold and platinum
prices. Sibanye-Stillwater rose 6.12% to 34 rand and AngloGold Ashanti was
up 3.66% at 298.93 rand. Platinum miner Impala Platinum was up 5.79% at 139
rand.

Kenya

Kenyan shilling holds steady amid importer demand

(Reuters) - The Kenyan shilling held steady on Wednesday with diaspora
remittances helping to meet increased dollar demand from merchandise
importers ahead of the holiday season, traders said.

At 0657 GMT, commercial banks quoted the shilling at 101.50/70 per dollar,
the same as Tuesday's close. 

       <mailto:info at bulls.co.zw> 

EMERGING MARKETS

EM stocks inch up to 2-week high; U.S. Fed, China trade in focus

(Reuters) - Developing world stocks inched up on Wednesday, while currencies
trod water ahead of the conclusion of a U.S. Federal Reserve policy meeting,
with uncertainty over the Sino-U.S. trade war adding to the cautious mood.

Amid swathes of mixed headlines over trade talks, markets are holding their
breath ahead of a Dec. 15 deadline for further U.S. tariff action on China,
which, if met, could derail future negotiations.

Stock markets strengthened slightly, as a report on Tuesday suggested that
the United States may delay Sunday’s deadline.

The MSCI emerging markets stock index ticked up to a more-than two-week
high, with Saudi Arabian stocks marking large gains on the market debut of
the now world’s largest listed company, Saudi Aramco.

Shares of the oil and gas behemoth opened up 10% on their Riyadh stock
market debut on Wednesday, closing in on the $2 trillion valuation long
sought by Saudi Crown Prince Mohammed bin Salman.

Markets were also waiting for the conclusion of the Federal Reserve’s final
policy meeting this year. While the bank is expected to keep rates on hold,
markets will be watching for any suggestions of future action, along with
economic growth prospects in 2020.

Chinese stocks closed marginally higher for the day, while Russian stocks
ticked up to a more-than one-week high.

MSCI’s emerging market currencies index was flat as the dollar ticked up
ahead of the Fed decision.

The Turkish lira and the Russian rouble weakened slightly against the
dollar, while the Hungarian forint softened against the euro.

The South African rand ticked up after touching its weakest level against
the dollar in nearly three weeks on Tuesday.

The country’s headline consumer price inflation was growing at its weakest
pace in 10 years in November, data from Statistics South Africa showed.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Japan buyer agrees to Q1 aluminium premium of $83/T, 14% lower than
Q4-source

(Reuters) - A Japanese aluminium buyer has agreed to pay a global producer a
premium of $83 per tonne over the benchmark price for shipments in January
to March, down 14% from the current quarter, a source directly involved in
the pricing talks said.

The figure is lower than the $97 per tonne paid in the October-December
quarter and marks a second consecutive quarterly drop. It is also lower than
the initial offers of around $92 made by producers.

Japan is Asia’s biggest importer of the light metal and the premiums
PREM-ALUM-JP for primary metal shipments it agrees to pay each quarter over
the benchmark London Metal Exchange (LME) cash price set the benchmark for
the region.

Nickel prices hit 2-week highs as investors cover short positions

(Reuters) - Nickel prices hit their highest in nearly two weeks on Thursday,
as investors who bet on falling prices had to buy in at a strong support
level.

Nickel prices have fallen in the past weeks to touch a five-month low of
$12,900 a tonne on the London Metal Exchange (LME) on Tuesday, as the market
viewed prices more expensive than supply and demand fundamentals indicated.

Three-month nickel on the LME on Thursday climbed as much as 0.9% to $13,980
a tonne, its highest since Nov. 29, while the most-traded nickel contract on
the Shanghai Futures Exchange (ShFE) jumped as high as 3.5% to 110,570 yuan
($15,708.42) a tonne, nearing a two-week high.

Other nickel industry players said that a royalty hike in top nickel ore
producer Indonesia contributed to a bullish view on prices, but they
expressed uncertainty over how long the upward trend could last.

FUNDAMENTALS

* SPREAD: The LME cash nickel contract was last at a $65 a tonne discount to
the three-month contract, suggesting sufficient nearby supplies.

* NICKEL STOCKS: LME on-warrant nickel inventories, or those available to
the market, rose to a 2-1/2-month high at 67,248 tonnes. MNISTX-TOTAL

* ALUMINIUM STOCKS & SPREAD: LME headline aluminium stocks MALSTX-TOTAL
jumped to their highest since April 2018 at 1.33 million tonnes, and the
spread between the cash and three-month contract flipped to a discount of
$8.75 a tonne after mostly holding in the premium zone for around a month.
CMAL0-3

* OTHER PRICES: LME zinc advanced 1.3% to $2,251 a tonne at 0436 GMT, while
copper and aluminium were almost unchanged. ShFE copper rallied 0.9% to
49,230 yuan a tonne and zinc jumped 1.2% while aluminium fell 0.4%.

* TRADE TALKS: U.S. President Donald Trump is expected to meet with top
trade advisers on Thursday to discuss planned Dec. 15 tariffs on some $160
billion in Chinese goods, sources told Reuters.

* JIANGXI COPPER: Jiangxi Copper Co,, one of China’s biggest copper
producers, said it will receive “financial assistance” to the tune of 1.5
billion yuan from its parent to repay loans and cut financing costs.

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
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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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