Bulls n Bears Daily Market Commentary : 04 February 2019

Tue Feb 5 06:18:33 CAT 2019

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Bulls n Bears Daily Market Commentary : 04 February 2019

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Zimbabwe Stock Exchange Update

Market Turnover $4,434,206.87 with foreign buys at $1,275,206.87 and foreign
sales were $543,841.28. Total trades were 123.

The All Share index opened the week in green after adding 0.13 points  to
close at 157.98 points. HIPPO VALLEY ESTATES  led the movers with a $0.0400
to close at $1.7500, FBC HOLDINGS  increased by $0.0299 to $0.3500 and
ZIMPAPERS  traded $0.0080 stronger at $0.0680. NATFOODS  also gained $0.0080
to end at $7.1125 and DAIRIBORD  was $0.0072 firmer at $0.1305.

Gains were partially offset by losses in PPC   which dropped $0.2000 to
$1.9000, MASIMBA  lost $0.0050 to settle at $0.0850 and CASSAVA SMARTECH
traded $0.0029 lower at $1.4954. AFRICAN SUN   was $0.0021 down at $0.1300
and FIRST CAPITAL BANK  eased $0.0005 to close at $0.0710.

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  Global Currencies & Equity Markets

Zimbabwe

Zimbabwe looks to alleviate foreign currency shortages -mines minister

(Reuters) - Zimbabwe’s mines minister on Monday said the central bank
governor would soon introduce a monetary policy tool to alleviate foreign
currency shortages that have affected mining companies.

Zimbabwe is hoping its mining sector could help drive a moribund economy
buffeted by high inflation and unemployment, as new President Emmerson
Mnangagwa looks to woo investors following a soft coup last year which
usurped former president Robert Mugabe.

But a shortage of cash has hurt industries, with Zimbabwe’s gold miner
RioZim last year closing its three mines due to a shortage of dollars, the
company said in a letter to the central bank seen by Reuters.

Chitando did not want to be drawn on what this intervention would be but
said the government was also revamping policies for specific minerals, such
as lithium and platinum, in a bid to improve investment.

Last month, Russian diamond miner Alrosa and China’s Anjin Investments were
selected by Zimbabwe’s government to partner with the state diamond company,
a state-run newspaper reported.

South Africa

South Africa's rand edges weaker, stocks down

(Reuters) - South Africa’s rand eased on Monday as a strong dollar and U.S.
Treasury yields holding recent gains put pressure on emerging market
currencies, while stocks also edged lower.

At 1550 GMT, the rand was 0.53 percent weaker at 13.4000 per dollar, after
closing at 13.3300 in New York on Friday.

The rand has had a stellar start to 2019, gaining nearly 7 percent against
the greenback, aided mainly by a global push for emerging market assets that
was accelerated by last week’s dovish message from the Federal Reserve.

With a dearth of top-tier data this week and most of Asian markets closed
for the Lunar New Year this week, the rand is expected to trade within
recent ranges between 13.40 and 13.20.

South African focused investors are waiting for President Cyril Ramaphosa’s
state of the nation address on Thursday, where he is expected to give an
update on plans to grow the economy and deal with cash-strapped state
companies.

The speech is likely to focus on job creation and highlight the government’s
key achievements over the past year,” she added.

Government bonds also weakened, with the yield on the benchmark 10-year bond
up 2.5 basis points at 8.64 percent.

Stocks slipped to their lowest since mid-January, with the Johannesburg
Stock Exchange’s Top-40 index down just over 1 percent at 47,183 points. The
broader all-share index was also down 1 percent at 53,391 points.

Firms exposed to South African consumers were hit the hardest, with
retailers like Mr Price, Woolworths and Spar Group and lenders including
Standard Bank and Absa weighing on the blue-chip index.

Meanwhile, Clover Industries, which processes products like olive oil and
yoghurt, closed up 15 percent after announcing a 4.8 billion rand ($358.81
million) buyout offer from a consortium. ($1 = 13.3776 rand)

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Emerging Markets 

Currencies weaken, stocks subdued in light holiday trading

(Reuters) - A strong dollar, rising oil prices and U.S. Treasury yields
holding on to recent gains put pressure on emerging markets on Monday, with
currencies falling and stocks subdued.

MSCI’s index for developing-world currencies extended losses. The dollar
gained after stronger-than-expected U.S. jobs and manufacturing reports on
Friday, although a dovish outlook from the Federal Reserve was still holding
it down.

MSCI’s index for emerging market stocks was down 0.2 percent, led by losses
in South Africa and India . China and South Korea were shut for the Lunar
New Year holiday; Hong Kong shares rose on a half-trading day.

India’s rupee fell to eight-week lows as oil prices rose to 2019 highs on
OPEC-led supply cuts and U.S. sanctions against Venezuela.

A central bank meeting later in the week was expected to leave Indian
interest rates unchanged. Economists had predicted rates would start rising
next quarter, but that changed after Governor Urjit Patel’s sudden
resignation from the Reserve Bank of India and his replacement by
Shaktikanta Das.

Turkey’s lira slipped 0.2 percent after data showed annual inflation crept
up to 20.35 percent in January. Poor weather drove food prices higher and
kept up the pressure for tight monetary policy.

South Africa’s rand slipped further away from six-month highs as investors
took profits from the previous week’s rally.

Russia’s rouble fell, under pressure from foreign currency purchases by the
central bank, but the MOEX index in Moscow was among the few stock markets
charting gains. Energy shares gained as oil prices rose.

In emerging Europe, Romania’s leu slipped lower after data showed producer
prices for December 2018 were lower than expected.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold prices near 1-wk lows as investors look to riskier assets

(Reuters) - Gold prices on Tuesday held near one-week lows touched in the
previous session, pressured by a firmer dollar and as investor appetite for
riskier assets picked up in the wake of strong U.S. economic data.

FUNDAMENTALS

* Spot gold was steady at $1,312.15 per ounce at 0110 GMT. Prices in the
last session fell to their lowest level since Jan. 29 at $1,308.20.

* U.S. gold futures dipped 0.2 percent to $1,316.50 an ounce.

* China’s financial markets are closed all week for the Lunar New Year
holiday.

* U.S. job growth surged in January, with employers hiring the most workers
in 11 months, pointing to underlying strength in the economy despite an
uncertain outlook.

* The solid jobs report allayed concerns of the slowdown in the U.S.
economy, leading traders to trim bets the U.S. Federal Reserve would need to
cut interest rates to support the economy later this year.

* The Fed’s new wait-and-see approach to monetary policy is suitable for
now, Cleveland Fed President Loretta Mester said on Monday, but the central
bank may need to raise interest rates a bit further if the economy does as
well as she expects.

* Recent U.S. data helped lift Asian stocks early on Tuesday.

* The dollar held on to recent gains against its peers on Tuesday, supported
by a recovery in investor risk appetite, which helped push up U.S. yields.

* The U.S.-China trade talks had a “good vibe” with much work remaining,
White House economic adviser Larry Kudlow said on Friday as China followed
through on a pledge to increase soybean purchases with orders of at least 1
million tonnes.

* Holdings of SPDR Gold Trust, the world’s largest gold-backed
exchange-traded fund, fell 0.50 percent to 813.29 tonnes on Monday from
Friday. 

U.S. dollar, yields rise; oil backs off two-month highs

(Reuters) - The U.S. dollar gained for a third straight session against a
basket of currencies and U.S. Treasury yields rose on Monday as investors
sought to zero in on the path of interest rates, while oil prices pulled
back from roughly two-month highs.

MSCI’s gauge of stocks across the globe gained 0.12 percent, near two-month
highs, as U.S. equities pushed modestly higher.

Investors were parsing the significance for financial markets from Friday’s
strong U.S. jobs report, which came on the heels of the Federal Reserve
saying it would be patient on future rate hikes amid a cloudy outlook for
the U.S. economy.

The dollar index, which measures the greenback against a basket of
currencies, rose 0.3 percent, while benchmark U.S. 10-year Treasury notes
last fell 9/32 in price to yield 2.7235 percent, from 2.691 percent late on
Friday.

On Wall Street, the Dow Jones Industrial Average rose 38.24 points, or 0.15
percent, to 25,102.13, the S&P 500 gained 8.65 points, or 0.32 percent, to
2,715.18 and the Nasdaq Composite added 65.50 points, or 0.9 percent, to
7,329.36.

Technology was the biggest riser among the S&P 500 sectors, as a busy
fourth-quarter earnings season was set to continue later on Monday with
Google parent Alphabet’s report.

S&P 500 companies are barely expected to eke out an increase in profits for
the first quarter of 2019.

The pan-European STOXX 600 index rose 0.06 percent as the heavyweight
banking sector fell following poor results from Julius Baer.

European investors were grappling with concerns about the euro zone economy
and about Britain’s plan to leave the European Union.

The euro was down 0.19 percent to $1.1432 against the dollar.

Improved risk appetite helped lift the dollar to a five-week high against
the safe-haven yen.

Oil prices fell after disappointing U.S. factory data sparked fresh concerns
about a slowdown in the global economy. But losses were limited as OPEC-led
supply cuts and U.S. sanctions against Venezuela brightened the supply
outlook.

U.S. crude fell 1.34 percent to $54.52 per barrel and Brent was last at
$62.66, down 0.14 percent on the day.

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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