Bulls n Bears Daily Market Commentary : 12 March 2019

Wed Mar 13 05:47:56 CAT 2019

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Bulls n Bears Daily Market Commentary : 12 March 2019

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Zimbabwe Stock Exchange Update

Market Turnover RTGS$3,365,552.80 with foreign buys at RTGS$1,821,957.94 and
foreign sales were RTGS$820,781.90. Total trades were 101.

The All Share index dropped by a significant 5.41 points  to close at 135.54
points. BRITISH AMERICAN TOBACCO   led the shakers with a hefty $1.0000 loss
to close at $32.0000, NATFOODS   eased $0.1600 to $7.0000 whilst CASSAVA
SMARTECH   was $0.1296 down at $1.2704. TSL   also decreased by $0.0674 to
end at $0.7001 and ECONET  traded $0.0623 weaker at $1.2374.

Three counters gained ground as OLD MUTUAL LIMITED   added $0.1415 to
$7.1079, AXIA  traded $0.0048 stronger at $0.4048 and SIMBISA  was $0.0004
firmer at $0.7105.

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  Global Currencies & Equity Markets

South Africa

South Africa's rand firms on renewed risk appetite

(Reuters) - South Africa’s rand firmed on Tuesday, supported by renewed risk
appetite after potential progress on Brexit in Britain and as the dollar
weakened after U.S. consumer price data.

Stocks also gained alongside emerging-market rivals, with drugmaker Aspen
Pharmacare leading the gainers as it clawed back gains after a sell-off last
week.

At 1501 GMT, the rand traded at 14.2975 per dollar, 0.33 percent firmer than
its New York close on Monday.

Risk appetite was boosted after Brussels agreed to last-minute changes to an
updated Brexit deal with British Prime Minister Theresa May on Monday night,
raising hopes the government would secure a deal before the Brexit deadline
in less than three weeks.

But Britain’s Attorney General Geoffrey Cox said the Brexit backstop
remained unchanged despite assurances from the European Union, reigniting
worries that the latest tweaks would not be enough to woo rebellious British
lawmakers who have threatened to vote down May’s plan again on Tuesday
evening.

Dollar weakness after U.S. consumer prices showed that inflation remains low
despite a tight labour market, bolstering the Federal Reserve’s case for
keeping interest rates on hold, also helped the rand.

In fixed income, the yield on the benchmark bond due in 2026 added 1 basis
point to 8.675 percent.

On the stock market, the Johannesburg All-Share index rose 0.21 percent to
55,699 points, while the Top-40 index firmed 0.16 percent to 49,468 points.

Multi-national drugmaker Aspen led the gainers following a sell-off on
Friday, when the company lost almost a third of its value on concerns about
ballooning debt. It rose 10.28 percent to 113.03 rand.

The financials index moved higher, boosted by solid results from the
country’s oldest bank FirstRand, which reported a 6.1 percent rise in
half-year headline earnings, outperforming rivals in retail banking.

FirstRand climbed 2.04 percent to 63.39 rand.

Builder Group Five applied for the suspension of trading in its shares after
it filed for bankruptcy protection on Tuesday as lenders pulled funding,
threatening the collapse of one of the biggest names in the local
construction industry and more than 8,000 jobs.

Uganda

Ugandan shilling weakens on demand from energy firms

(Reuters) - The Ugandan shilling weakened on Tuesday, hurt by demand from
energy firms and other importers weighing against scant supplies.

At 0945 GMT commercial banks quoted the shilling at 3,705/3,715, weaker than
Monday’s close of 3,695/3,705.

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Asia

Asian shares drift lower, sterling awaits its fate

(Reuters) - Asian share markets were mostly in the red on Wednesday as a
risk-off mood gripped investors, while a frazzled pound awaited its fate
ahead of yet another make-or-break parliamentary vote on Brexit.

MSCI’s broadest index of Asia-Pacific shares outside Japan eased 0.4 percent
in slow trade and almost every major index in the region nursed losses.

Japan’s Nikkei led the way with a fall of 1.3 percent as data showed
machinery orders fell in January at the fastest pace in four months.

Shanghai blue chips slipped 0.4 percent following two days of gains. E-Mini
futures for the S&P 500 were off 0.25 percent.

Risk appetites had soured after British lawmakers crushed Prime Minister
Theresa May’s European Union divorce deal, forcing parliament to decide
within days whether to back a no-deal Brexit or seek a last-minute delay.

Lawmakers voted against May’s amended Brexit deal by 391 to 242 as her
last-minute talks with EU chiefs on Monday to assuage her critics’ concerns
ultimately proved fruitless.

Parliament will vote later Wednesday on whether to leave the EU with no
deal, and if that fails, a further vote on Thursday will decide whether to
extend the Brexit deadline.

The pound could do with some comfort after a wild couple of sessions. It was
last at $1.3085, having been as high as $1.3296 and as low as $1.3017 so far
this week.

U.S. INFLATION SLOWS

On Wall Street, Boeing Co shed another 6.1 percent for its biggest two-day
drop since June 2009, as more countries grounded the company’s 737 MAX 8
planes following Sunday’s crash in Ethiopia, the second fatal crash in
months.

The drop in Boeing pushed the Dow down 0.38 percent, even as the S&P 500
gained 0.30 percent and the Nasdaq added 0.44 percent.

A soft U.S. inflation report for February burnished bonds while tarnishing
the dollar. Annual consumer price inflation slowed to its lowest since
September 2016 at 1.5 percent.

The data merely reinforced expectations the Federal Reserve will stay
patient on rates and could even sound more dovish at its policy meeting next
week.

Yields on U.S. 10-year notes duly declined to a 10-week low at 2.596
percent, while the dollar idled at 96.956 against a basket of currencies.

The dollar drifted off to 111.18, while the euro climbed to $1.1289 and away
from last week’s 20-month trough of $1.1174.

In commodity markets, the dip in the dollar helped gold reach its highest in
two weeks and it was last at $1,304.11 per ounce.

Oil prices edged up on tightening global supply after a Saudi official said
the kingdom plans to cut oil exports in April, while the U.S. government
reduced its forecast for domestic crude output growth.

U.S. crude was last up 20 cents at $57.07 a barrel, while Brent crude
futures added 11 cents to $66.78.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold hits near 2-week high on Brexit woes, weaker dollar

(Reuters) - Gold rose to its highest level in nearly two weeks on Wednesday,
after regaining the key $1,300 level in prior session, buoyed by safe haven
demand from Brexit chaos and a fall in dollar after a softer U.S. data.

FUNDAMENTALS

* As of 0130 GMT, spot gold was up 0.2 percent at $1,303.74 per ounce, after
touching its highest since March 1 earlier in the session at $1,304.63.

* U.S. gold futures were up 0.4 percent at $1,303.80 an ounce.

* The dollar index fell about 0.3 percent in the previous session.

U.S. consumer prices rose for the first time in four months in February, but
the pace of the increase was modest, resulting in the smallest annual gain
in nearly 2-1/2 years.

* British lawmakers crushed Prime Minister Theresa May’s European Union
divorce deal on Tuesday, thrusting Britain deeper into crisis and forcing
parliament to decide within days whether to back a no-deal Brexit or seek a
last-minute delay.

* The European Union will not negotiate Brexit again, it said on Tuesday,
after Britain’s parliament rejected the divorce package for a second time in
a vote that made a chaotic no-deal scenario more likely.

* Asian share markets got off to a subdued start on Wednesday after a mixed
finish on Wall Street, while a frazzled pound awaited its fate ahead of yet
another make-or-break parliamentary vote on Brexit.

* The United States and China may be in the final weeks of discussions to
hammer out a deal to ease their tit-for-tat tariffs dispute, U.S. Trade
Representative Robert Lighthizer said on Tuesday.

* Japan’s machinery orders fell in January at the fastest pace in four
months due to a decline in orders from auto and telecommunications equipment
makers and as the U.S.-China trade war dented global demand.

* European Central Bank policymakers want to reduce banks’ reliance on
central bank cash and will tailor a fresh loan facility to curb appetite,
four sources familiar with the discussion have told Reuters.

* Russian gold producer Polyus has received a further 5 percent stake in the
giant Sukhoi Log gold deposit from its project partner Rostec in return for
a 0.28 percent stake in Polyus shares, Polyus said late on Monday.

* Australia’s top gold miner Newcrest Mining Ltd on Tuesday said it signed
an exploration agreement for a joint venture with London-listed Greatland
Gold Plc.

* SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund,
said its holdings rose 0.38 percent to 772.46 tonnes on Tuesday from 769.53
tonnes on Monday.

U.S. working on steel, aluminum tariff relief for Mexico, Canada -trade
chief

(Reuters) - The United States is working on a plan to lift tariffs from
Mexican and Canadian steel and aluminum but preserve the gains that domestic
producers have received from the duties so far, U.S. Trade Representative
Robert Lighthizer said on Tuesday.

The United States imposed the “Section 232” tariffs on steel and aluminum
nearly a year ago to protect domestic producers on national security
grounds. A plan to lift tariffs on the metals from Canada and Mexico was
once linked to the renegotiation of the North American Free Trade Agreement
but ultimately was excluded from that deal.

Since then, a number of U.S. lawmakers have said they did not believe the
new U.S.-Mexico-Canada Agreement (USMCA) could win approval in Congress if
the metals tariffs — along with and retaliatory duties on U.S. farm and
other products — were left in place.

Members of the New Democrat Coalition in the House of Representatives echoed
a similar message in a meeting with Lighthizer later on Tuesday.

Kind added that Lighthizer expected to meet with Mexican and Canadian
counterparts on the issue this week.

A spokeswoman for the U.S. Trade Representative’s office declined to
comment, saying there were no scheduling announcements on the 232 issue.

The United States has sought quotas on steel and aluminum in lieu of
tariffs, but Canada and Mexico have resisted such restrictions, arguing that
they pose no threat to U.S. national security.

A Mexican official said talks were continuing.

Kind cautioned that the Trump administration would need to submit the USMCA
enabling legislation soon to Congress so it could be considered before the
August recess. After that, it could become caught up in another border wall
funding fight in the fall and later the 2020 presidential election campaign,
which would diminish its approval chances.

INVESTORS DIARY 2019

Company

Event

Venue

Date & Time

Zimbabwe 

Independence Day

Zimbabwe

18 Apr 2019 

Good Friday

19 Apr 2019

Easter Saturday

20 Apr 2019

Easter Sunday

21 Apr 2019

Easter Monday

22 Apr 2019

Workers Day

01 May  2019

Africa Day

25 May 2019

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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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