Bulls n Bears Daily Market Commentary : 12 July 2019

Sun Jul 14 23:42:32 CAT 2019

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Bulls n Bears Daily Market Commentary : 12 July 2019

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Zimbabwe Stock Exchange Update

Market Turnover ZWL$ 7,643,236.13 with foreign buys at ZWL$ 4,697,220.70 and
foreign sales were ZWL$480,219.50 Total trades were 100.

The All Share index closed the week on a lower note  losing 0.54 points  to
close at 189.98 points. SIMBISA  eased $0.0475 to end at $1.0501, CASSAVA
SMARTECH   retreated by $0.0460 to end at $1.6500 and FIRST MUTUAL HOLDINGS
was $0.0195 weaker at $0.2205. ECONET   also decreased by $0.0103 to $1.6195
and PROPLASTICS   was $0.0010 lower at $0.3800.

Loss were partially offset by gains in OLD MUTUAL LIMITED  which added
$0.5824 to $15.4824, SEEDCO  rose by $0.0994 to $1.5994 and POWERSPEED  was
$0.0600 stronger at $0.3600. DELTA  recovered by $0.0075 to close at $3.5100
and MASHONALAND HOLDINGS  traded $0.0074 firmer at $0.0480.

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  Global Currencies & Equity Markets

South Africa

South Africa's rand firms on Powell's remarks, Kganyago reappointment

(Reuters) - South Africa’s rand firmed on Wednesday as the dollar weakened
after U.S. Federal Reserve Chairman Jerome Powell highlighted risks to the
U.S. economy in remarks that could bolster expectations of an interest rate
cut later this month.

The rand was also boosted by news that President Cyril Ramaphosa has
re-appointed South African Reserve Bank Governor Lesetja Kganyago for
another five-year term.

At 1530 GMT the rand was 0.95% firmer at 14.0525 per dollar.

Emerging markets have enjoyed capital inflows this year on signs major
central banks will embrace a looser monetary policy as a result of trade
disputes and growth concerns.

However, strong U.S. jobs data on Friday all but ended expectations of a
bold interest rate cut from the Fed at its meeting this month, leaving
investors in search of hints on where rates are headed.

On the bourse, the benchmark Johannesburg Stock Exchange Top-40 Index was up
1.15% to 51,491.95 points while the broader All-Share Index closed 1.11%
higher at 57,597.87 points.

Mining company Goldfields was at the top of the blue-chip index, rising by
5.06% to 77.05 rand, while pharmaceuticals Aspen closed 3.50% higher at 105
rand. Retailer Clicks was up 2.76% to 209.24 rand.

Dragging down further gains was steel producer Arcelormittal , which fell
nearly 16% to 2.91 rand after plunging to a first-half loss due to rising
costs and a flagging economy that could see some 2,000 jobs lost.

In fixed income, the yield on the benchmark 2026 government issue fell by
0.5 basis points to 8.11%.

Uganda

Ugandan shilling firms, helped by commercial banks selling dollars

(Reuters) - The Ugandan shilling        firmed on Wednesday, helped by
commercial banks selling their excess dollar holdings, traders said.

At 0935 GMT commercial banks quoted the shilling at 3,680/3,690, compared to
Tuesday's close of 3,690/3,700.

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America

Currencies, stocks look to Fed's Powell for clues on U.S. rates

(Reuters) - Emerging market currencies were caught in a tight trading range
on Wednesday ahead of U.S. Federal Reserve chief Jerome Powell’s
congressional testimony, which could offer insights on where interest rates
are headed.

Moves in emerging markets could be dictated by the tone Powell sets later in
the day, building or breaking expectations of the Fed embarking on an easing
cycle at a policy meeting this month, hopes of which have supported inflows
into risky, developing world assets.

While currencies were tepid, the MSCI index of emerging equities was set to
snap a three-day run of losses, helped by gains in Taiwan and Hong Kong.

Chinese stocks dropped despite news that Washington and Beijing officials
had held a “constructive” telephone conversation as the two sides try to end
a bruising trade war that has weighed on global growth.

Strong U.S. jobs data last week eased expectations of a 50-basis-point rate
cut from the Fed in July, but investors have fully priced in a
25-basis-point cut.

Jolting financial markets overnight was the stormy exit of Mexico’s finance
minister, Carlos Urzua, who cited “extremism” in economic policy. President
Andres Manuel Lopez Obrador quickly named well-regarded deputy minister
Arturo Herrera to replace him.

The Mexican peso fell 0.24%, adding to its more than 1% slide on Tuesday.

The Turkish lira extended this week’s losses as investors fretted over
political interference in Turkey’s monetary policy.

The Haberturk news website reported on Wednesday that President Tayyip
Erdogan said Turkey could face serious problems if its central bank is not
completely overhauled after the dismissal of governor Murat Cetinkaya.

Russia’s rouble edged higher as oil prices rose, while South Africa’s rand
held steady ahead of finance minister Tito Mboweni’s budget speech.

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Commodities Markets

Base metals head higher on hopes of trade deal, U.S. rate cut

(Reuters) - Industrial metals prices rose sharply on Wednesday after U.S.
and Chinese negotiators opened a new round of trade talks and Federal
Reserve Chairman Jerome Powell bolstered expectations of a U.S. interest
rate cut later this month.

Copper, aluminium, zinc, nickel and lead each gained more than 1.5% on the
London Metal Exchange (LME), with benchmark copper closing up 2% at $5,940 a
tonne.

They are still well down from a year ago, however, when U.S. President
Donald Trump began a trade conflict with China which investors expect to
weaken economic growth and metals demand.

Nickel ended 2.3% higher at $12,990 a tonne after touching $13,000, the
highest since April 17.

But weak supply and demand fundamentals mean prices of the metal used in
stainless steel will likely slip to $11,000 by the end of the year, said
Capital Economics analyst Ross Strachan.

FED: Concerns about trade policy and a weak global economy “continue to
weigh on the U.S. economic outlook” and the Fed stands ready to “act as
appropriate” to sustain a decade-long expansion, Powell said.

U.S. equities touched record highs and the dollar weakened.

TRADE TALKS: U.S. and Chinese trade officials held a constructive phone
conversation, White House economic adviser Larry Kudlow said, marking a new
round of talks. Kudlow said the discussion went well.

COLUMN: The base metal markets are suffering from trade war fatigue, with
LME volumes down 7% in the first half of 2019, writes Andy Home.

CHINA: China’s producer prices flatlined in June, fuelling concerns that a
slowdown in manufacturing will further drag on growth in the world’s largest
metals consumer.

China’s economic growth is expected to slow to a near 30-year low of 6.2%
this year, a Reuters poll showed.

NICKEL STOCKS: Inventories in LME-registered warehouses are the lowest since
2013 at 153,612 tonnes, though stocks in Shanghai Futures Exchange (ShFE)
storehouses more than doubled in recent weeks to 21,811 tonnes. MNISTX-TOTAL
SNI-TOTAL-D

FUNDAMENTALS: There was a global deficit of 27,200 tonnes over January-April
in the 2.4 million tonne a year nickel market, the International Nickel
Study Group said.

Indonesia said this week it expected three nickel smelters to become
operational in 2019, with annual processing capacity of 3.9 million tonnes
of ore.

NYRSTAR: Nyrstar said it was extending force majeure at its Port Pirie lead
and zinc smelter in Australia.

SCRAP: China issued a fresh batch of import quotas for newly restricted
high-grade copper scrap and aluminium scrap.

ALUMINIUM: Bosnia’s sole aluminium smelter was shut down on Wednesday over a
huge debt it had incurred.

OTHER METALS: LME aluminium finished up 1.7% at $1,850 a tonne, zinc rose
1.7% to $2,401 and lead gained 2.2% to $1,963. Tin bucked the trend to close
down 0.1% at $18,200 a tonne.

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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