Bulls n Bears Daily Market Commentary : 14 June 2019

Mon Jun 17 00:56:57 CAT 2019

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Bulls n Bears Daily Market Commentary : 14 June 2019

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Zimbabwe Stock Exchange Update

Market Turnover RTGS$ 5,860,722.95 with foreign buys at RTGS$ 1,954,704.00
and foreign sales were RTGS$ 1,769,975.50 Total trades were 142.

The All Share index rose by 6.57 points to close at 206.79 points. OLD
MUTUAL LIMITED gained $0.4137 to close at $14.4169, CASSAVA SMARTECH
ZIMBABWE LIMITED  added $0.2302 to close at $2.0405 and ECONET WIRELESS
ZIMBABWE rose by $0.0919 closing at $2.0428. Other counters to advance were
MEIKLES LIMITED   which increased by $0.0500 to end at $1.0500 and  CBZ
HOLDINGS LIMITED which added by  $0.0400 to $0.4900.

Trading in the negative: OK ZIMBABWE LIMITED lost $0.0175 to close at
$0.5025. FBC HOLDINGS LIMITED was $0.0025 weaker and closed at $0.5025 and
STAR AFRICA CORPORATION LIMITED declined by $0.0001 to settle at $0.0200.

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  Global Currencies & Equity Markets

Uganda

Uganda government spending to rise 23% in 2019/20 - finance minister

(Reuters) - Uganda plans to raise its spending by 23% in 2019/20 (July-June)
to 40.1 trillion shillings, and its fiscal deficit will rise, its finance
minister said on Thursday in his budget speech.

Matia Kasaija said in parliament the 2019/2020 fiscal deficit will be 8.7%
of GDP, up from 5.8% in this fiscal year, which ends this month.

He said the government will borrow 2.8 trillion shillings from domestic
markets in 2019/20 up from 2.2 trillion shillings in 2018/19. External
financing will be 10.11 trillion shillings, but he did not say how much of
this will be borrowed. 

South Africa

Rand edges down as Ramaphosa, inflation data in focus

(Reuters) - South Africa’s rand inched lower late on Thursday, as investors
assessed local political developments ahead of local inflation numbers next
week and a decision on U.S. interest rates.

At 1600 GMT the rand was 0.08% weaker at 14.8800 per dollar, pausing the
previous session’s dive of more than 1% following news that donations to
President Cyril Ramaphosa’s 2017 campaign would be investigated.

Ramaphosa has said he will cooperate with the investigation into whether he
misled parliament over the donation, and analysts say is no immediate risk
that he could be removed from office, but the rand remains susceptible to
political developments.

Second quarter business confidence remained unchanged from the previous
quarter, remaining near record lows with local investors uneasy over South
Africa’s near-term growth prospects.

Mining continued to shrink, data from Statistics South Africa showed, with
gold and iron ore production recording double-digit contractions as firms
battled volatile prices and an uncertain local political climate.

Bonds also weakened, with the yield on the benchmark 10-year government
issue up 2.5 basis points at 8.39%.

Stocks were flat, with the Johannesburg Stock Exchange’s top-40 index edging
0.05% lower to 52,592 points and the broader all-share index at 58,697
points - a 0.02% decrease.

Financial firms and retailers suffered again due to the weak rand, with
retailers Shoprite, The Foschini Group and Mr Price all down between 2% and
3%.

The rand’s losses however helped miners, as did a rally in iron ore and gold
prices. Anglo American and AngloGold Ashanti topped the index, up 2.4% and
1.7% respectively. 

       <mailto:info at bulls.co.zw> 

Asia

Asian stocks subdued, oil near 5-month low on U.S. inventory build

(Reuters) - Asian stocks stuttered on Thursday, dogged by the uncertainty
over an intractable U.S.-China trade dispute, while oil prices flirted with
five-month lows thanks to higher U.S. crude inventories and a bleaker demand
outlook.

MSCI’s broadest index of Asia-Pacific shares outside Japan ticked down 0.1%,
slipping from a one-month high touched earlier this week, while Japan’s
Nikkei lost 0.3%.

On Wall Street, the S&P 500 lost 0.20% on Wednesday.

A bigger mover overnight was oil, which tumbled 4% to their lowest
settlements in nearly five months, pressured by another unexpected rise in
U.S. crude stockpiles and by a dimming outlook for global oil demand.

Brent crude futures barely moved at $60.01 in early trade after a 3.7% slide
on Wednesday to $59.97 a barrel, the international benchmark’s lowest close
since Jan. 28.

U.S. West Texas Intermediate crude futures firmed slightly to $51.29 per
barrel, compared to the previous day’s close of 50.72 a barrel, its weakest
settlement since Jan. 14.

Government data showed on Wednesday U.S. consumer prices barely rose in May,
with the core annual inflation slowing to 2.0%, compared to a peak of 2.4%
last July, adding to the growing expectations of a Federal Reserve rate cut
in coming months.

Investors will be looking to what Fed policymakers will say after its next
policy meeting on June 18-19, with Fed Funds rate futures pricing in a
25-basis-point rate cut for the subsequent policy review on July 30-31.

The 10-year U.S. Treasuries yield dipped to 2.122 percent , a tad above
Friday’s 2.053 percent, its lowest level since September 2017 while the
two-year yield fell to 1.887 percent.

Bond yields have plunged worldwide in the past several weeks as investors
bet the Fed, and possibly other major central banks, will cut rates to
cushion the potential economic damage from the U.S.-China trade standoff.

Hopes that the leaders of the two countries will clinch a deal on the
sideline of Group of 20 summit meeting in Osaka on June 28-29 have been
fading as neither side has shown a willingness to compromise.

Major currencies saw limited moves, and trader say few were placing big bets
ahead of key events later this month including the Fed’s policy review and
the G20 meeting.

The euro slipped to $1.1293, stepping back from 2-1/2-month highs of $1.1348
touched on Friday. The dollar was little changed 108.47 yen.

The British pound is on the back foot after British lawmakers defeated an
attempt led by the opposition Labour Party to try to block a no-deal Brexit
by seizing control of the parliamentary agenda from the government.

Sterling fetched $1.2693, not far from this week’s low of $1.2653. 

 <mailto:info at bulls.co.zw> 

Commodities Markets

Oil tumbles on demand worries; stocks hit by trade, economic fears

(Reuters) - Oil prices slid 4% on Wednesday on higher U.S. crude inventories
and a bleaker demand outlook, while uncertainty over the U.S.-China trade
war and U.S. economic data weighed on stocks.

The dollar index rose as trade tensions and U.S. interest rate policy
remained in focus after President Donald Trump expressed optimism about the
prospects for a trade deal with China but continued to threaten tariff
increases in the absence of a deal.

Earlier in the day, May data showed moderate inflation as U.S. consumer
prices barely rose. That, with a slowing economy, could build a case for the
U.S. Federal Reserve to cut interest rates.

Weak economic data such as Wednesday’s has investors hoping the Fed would
give hints about a rate cut after its June 18-19 meeting.

Hopes for a rate cut were not enough to outweigh worries about the economic
impact of escalating trade tensions.

With under three weeks to go before proposed talks between Trump and Chinese
President Xi Jinping at the June 28-29 G20 summit in Osaka, Trump said on
Wednesday he had a “feeling” a U.S.-China trade deal could be reached. But
he again threatened to increase tariffs on Chinese goods if there is no
agreement.

The Dow Jones Industrial Average fell 43.68 points, or 0.17%, to 26,004.83,
the S&P 500 lost 5.88 points, or 0.20%, to 2,879.84 and the Nasdaq Composite
dropped 29.85 points, or 0.38%, to 7,792.72.

The pan-European STOXX 600 index lost 0.30% and MSCI’s gauge of stocks
across the globe shed 0.28%.

OIL FALLS, TREASURY YIELD CURVE STEEPENS The U.S. Treasury yield curve was
steeper after soft inflation data pulled short-dated yields lower.

Looking ahead, “focus will continue to turn to headlines surrounding trade.
Also in focus the remainder of the week will be the $16 billion 30-year
auction tomorrow (Thursday) and retail sales on Friday,” wrote Justin
Lederer, Treasury analyst and trader at Cantor Fitzgerald.

Benchmark 10-year notes last rose 6/32 in price to yield 2.1205%, from 2.14%
late on Tuesday.

In currency markets, the dollar index, tracking the currency against six
major peers, rose 0.33%, with the euro down 0.35% to $1.1289.

The euro dropped as Trump said he was considering sanctions over Russia’s
Nord Stream 2 natural gas pipeline project and warned Germany against being
dependent on Russia for energy.

Oil futures extended their losses as the day wore on and ended the session
with their lowest settlements in nearly five months, weakened by an
unexpected rise in U.S. crude inventories and a dimming outlook for global
oil demand.

U.S. crude settled down 4% or $2.13 to $51.14 per barrel while Brent crude
futures settled down 3.7% or $2.32 at $59.97.

Gold climbs on Fed rate cut speculation, growth concerns

(Reuters) - Gold prices gained momentum on Wednesday as the dollar dipped on
speculation about the U.S. central bank cutting interest rates this year
amid global economic growth concerns.

Spot gold was trading 0.5% higher at $1,332.77 per ounce as of 1:32 p.m. EDT
(1732 GMT), a rebound from the previous session when it fell to a 10-day low
of $1,319.35.

U.S. gold futures settled 0.4% higher at $1,336.80 per ounce.

Global equities snapped a seven-day winning streak after U.S. President
Donald Trump said he had no interest in moving ahead with a trade deal with
China unless Beijing agreed to four or five “major points.”

Adding to concerns, U.S. consumer prices barely rose in May, likely
increasing pressure on the Fed to cut interest rates this year.

Fed policymakers will meet on June 18-19. Markets have priced in at least
two U.S. rate cuts by the end of 2019. Futures imply around an 80% chance of
a rate cut as early as July.

Lower interest rates make safe-haven assets such as gold, which does not
yield interest, more attractive while weighing on the dollar. The U.S.
currency was trading largely unchanged against a basket of currencies on
Wednesday.

Holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded
fund, fell marginally to 756.18 tonnes on Tuesday from 756.42 tonnes on
Monday.

The gold bulls have the overall near-term technical advantage and regained
momentum today,” Jim Wyckoff, senior analyst at Kitco, said in a note. He
added that the next upside price target would be a close in August futures
above June’s high of $1,352.70.

Among other metals, silver was up 0.6% to $14.78 per ounce, while platinum
dipped half a percent to $808.75 an ounce.

Palladium was trading more than 1% higher at $1,408.51, having hit a
six-week high of $1,414.40 earlier in the session. The autocatalyst metal
was trading higher for a fifth consecutive session. 

INVESTORS DIARY 2019

Company

Event

Venue

Date & Time

Zimplow

AGM

Head Office, 36 Birmingham Road, Southerton

13 June 2019, 10am

TSL

AGM

28 Simon Mazorodze Road, Southerton

19 June 2019, 12pm

Zimpapers

AGM

Boardroom, 6th Floor, Herald House

20 June 2019, 12pm

Masimba Holdings

AGM

Head Office, 44 Tilbury Road, Willowvale

21 June 2019, 12:30pm

RioZim

AGM

1 Kenilworth Road, Highlands

24 June 2019, 10:30am

Proplastics

AGM

Palm Court, Meikles

25 June  2019, 10am

Fidelity Life

AGM

Great Indaba Room, Crowne Plaza Monomotapa

26 June 2019, 10am

GB Holdings

AGM

Cernol Chemicals Boardroom,  111 Dagenham Road, Willowvale

26 June 2019, 11:30am

Dawn Properties

AGM

Ophir Room, Monomotapa Hotel

27 June 2019, 10am

Unifreight

AGM

Royal Harare Golf Club

27 June 2019, 10am

African Sun

AGM

Ophir Room, Monomotapa Hotel

27 June 2019, 12pm

FMP

AGM

Palm Court, Meikles

27 June 2019, 12pm

MedTech

AGM

Boardroom, Stand 619, corner Shumba/Hacha Roads, Ruwa

27 June 2019, 2pm

FML

AGM

Palm Court, Meikles)

27 June 2019, 2:30pm

FBC

AGM

Royal Harare Golf Club

27 June 2019, 3pm

ZHL

AGM

Aquarium Room, Crowne Plaza Monomotapa Hotel

30 June 2019, 10am

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DISCLAIMER: This report has been prepared by Bulls ‘n Bears, a division of
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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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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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