Bulls n Bears Daily Market Commentary : 19 March 2019

Wed Mar 20 06:37:39 CAT 2019

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Bulls n Bears Daily Market Commentary : 19 March 2019

 <mailto:info at bulls.co.zw> 

Zimbabwe Stock Exchange Update

Market Turnover RTGS$1,430,036.00 with foreign buys at RTGS$122,230.90 and
foreign sales were RTGS$141,986.45. Total trades were 65.

The All Share index recovered 1.05 points  to close at 129.72 points as
three heavyweight counters gained ground. ECONET  added $0.0483 to settle at
$1.1522, CASSAVA SMARTECH  put on $0.0481 to end at $1.1983 whilst PADENGA
traded $0.0025 stronger at $0.9425.

Gains were offset by losses in BRITISH AMERICAN TOBACCO  which dropped
$2.0000 to settle at $30.0000, PPC  lost $0.0500 to $1.6500 and INNSCOR  was
$0.0475 down at $1.4000. DELTA   also decreased by $0.0012 to end at $2.2989
and WILLDALE  traded $0.0010 weaker at $0.0180.

 <mailto:info at bulls.co.zw> 

  Global Currencies & Equity Markets

South Africa

South Africa's rand steadies, investors eye Fed meeting

(Reuters) - South Africa’s rand steadied on Tuesday as the prospect of
rolling blackouts and downbeat economic data offset expectations that a
dovish tone at this week’s U.S. Federal Reserve policy meeting could lift
emerging market assets.

At 1637 GMT, the rand traded at 14.4425 per dollar, 0.02 percent weaker than
its New York close on Monday.

The Fed’s two-day meeting starts later on Tuesday. Money markets are pricing
in a 99 percent probability of U.S. borrowing costs not being altered on
Wednesday.

Caution prevailed among investors as South Africa’s power utility said it
would continue implementing power cuts on a rotational basis as it struggles
with generating capacity shortages.

Analysts say power cuts, which have happened in several rounds since June
last year, are one of the reasons why business confidence has slumped in
recent months.

Statistics South Africa is scheduled to publish February consumer price
inflation figures and January retail sales data on Wednesday.

In fixed income, the yield on the benchmark government bond due in 2026 rose
6.5 basis points to 8.76 percent.

Stocks meanwhile rose, with the Johannesburg All-Share index up 0.14 percent
to 56,849 points, while the Top-40 Index firmed 0.17 percent to 50,475
points.

Commodity stocks lead the bourse higher as palladium surged past $1,600 for
the first time on Tuesday on expectations that an already strained supply
scenario for the autocatalyst metal could worsen, while platinum soared 3
percent.

Gold also joined other precious metals to benefit from a weaker dollar going
into the Fed meeting.

Sibanye-Stillwater jumped 8.45 percent to 16.56 rand, Lonmin Plc climbed
4.85 percent, and Impala Platinum rose 2.56 percent to 67.22 rand. 

Uganda

Uganda shilling steady, expected to firm due to inflows from charities

(Reuters) - The Ugandan shilling was stable on Tuesday but was forecast to
firm on the back of some dollar inflows from charities and commodity
exporters, traders said.

At 0913 GMT, commercial banks quoted the shilling at 3,697/3,707, compared
to Monday's close of 3,700/3,710.

       <mailto:info at bulls.co.zw> 

Asia

Asian shares slip from 6-month high ahead of Fed policy decision

(Reuters) - Asian shares slipped from six-month highs on Wednesday as
investors took profits ahead of a policy decision by the U.S. Federal
Reserve which is expected to shed more light on its interest rate plans for
the rest of the year.

MSCI’s broadest index of Asia-Pacific shares outside Japan dropped 0.4
percent, led by losses in Australia and South Korea.

Japan’s Nikkei was little changed while mainland Chinese shares fell 0.5
percent.

Wall Street shares were narrowly mixed on Tuesday, with the S&P 500 losing
0.01 percent and the Nasdaq adding 0.12 percent.

Some market players said selling was triggered by a report of U.S. concerns
that China is pushing back against American demands in trade talks.

Still, on the whole, many market players held on to hopes of a trade deal
between Washington and Beijing as officials from both sides remained locked
in negotiations.

U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven
Mnuchin plan to travel to China next week for another round of trade talks
with Chinese Vice Premier Liu He, a Trump administration official said on
Tuesday.

Confidence among Asian companies remained near three-year lows in the first
quarter as the U.S.-China trade dispute dragged on, pulling down a global
economy that is already on a downward path, a Thomson Reuters/INSEAD survey
found.

Companies in the survey listed the global trade war as the top business
risk, followed by higher interest rates and the slowing Chinese economy.

The Fed is widely expected keep rates steady later in the day, putting the
main market focus on its policymakers’ rate projections for the next few
years.

Since the beginning of year, Fed Chairman Jerome Powell has said the central
bank would be patient - interpreted as code word for holding off on a rate
hike - on signs of slowing economic growth in the United States and many
parts of the world.

Financial markets have gone even further by pricing in a rate cut this year.
Fed funds futures point to about a 30 percent chance of a cut by the end of
year.

The Fed is also expected to lay out a plan to stop shrinking its $4 trillion
balance sheet, or so-called quantitative tightening. Many policy makers have
suggested the Fed is likely to conclude the process and stabilise its bond
holdings by the end of this year.

Expectations of a more cautious Fed have dented the U.S. dollar, which has
already been under pressure this year after Powell all but signalled a pause
to the tightening cycle at the previous meeting.

The dollar’s index against a basket of six major currencies hit 2 1/2-week
low of 96.288 on Tuesday and last stood at 96.465.

The euro traded little changed at $1.1354, near Tuesday’s two-week high of
$1.1362.

The dollar fetched 111.61 yen, up slightly on the day but below Friday’s
nine-day high of 111.90.

The Australian dollar dipped 0.2 percent to $0.7071 , as the country’s bond
yields extended their breakneck decline to multi-year lows on expectations
of a rate cut in Australia.

It was not helped by 6-percent fall in China’s iron ore prices on
expectation of higher supply as Vale SA is set to resume work at its largest
iron ore mine in Minas Gerais state.

The British pound remained hostage to headlines on Brexit.

Prime Minister Theresa May is expected to ask the European Union to delay
Brexit by at least three months after her plan to hold a third vote on her
deal was thrown into disarray by a surprise intervention from the speaker of
parliament.

May had earlier warned parliament that if it did not ratify her deal, she
would ask to delay Brexit beyond June 30, a step that Brexit’s advocates
fear would endanger the entire divorce.

On the other hand, the EU’s chief negotiator, Michel Barnier, has said an
extension would only make sense if it increased the chances of May’s deal
being ratified by Britain’s House of Commons.

Sterling last stood flat at $1.3265, off its nine-month peak of $1.3380 hit
a week ago.

Oil prices held close to four-month highs on expectations that OPEC would
continue production cuts through the end of the year and after data from the
American Petroleum Institute (API) showed a surprise draw-down on crude
inventories.

U.S. West Texas Intermediate (WTI) futures stood flat at $59.02 per barrel
after touching their highest since November at $59.57 on Tuesday.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Base metals slip in thin trade ahead of Fed meeting outcome

(Reuters) - Most industrial metals on the London Metal Exchange dipped on
Wednesday, retreating from some sessions of gains as investors stayed on the
sidelines ahead of the result of the U.S. Federal Reserve rate meeting later
in the day.

FUNDAMENTALS

* Three-month copper on the London Metal Exchange fell 0.2 percent to $6,446
a tonne by 0337 GMT, while the most-traded copper contract on the Shanghai
Futures Exchange eased 0.1 percent to 49,200 yuan ($7,328.63) a tonne.

* London aluminium retreated 0.4 percent from a three-month high reached in
the previous session following a cyber attack on aluminium maker Norsk
Hydro, while lead eased 0.1 percent.

* FED: The U.S. Federal Reserve will announce the result of its policy
meeting later on Wednesday. It is widely expected to hold its benchmark rate
unchanged, but investors will look for any clues on future rate moves.

* TRADE: U.S. Trade Representative Robert Lighthizer and Treasury Secretary
Steven Mnuchin plan to travel to China next week for trade talks with
Chinese Vice Premier Liu He, a U.S. official said on Tuesday.

* KGHM STRIKE: Miner KGHM will extend negotiations with a union at its
Chilean copper mine Sierra Gorda, averting a strike, a union representative
said.

* CODELCO SMELTER: The reactivation of a smelter belonging to Chile’s
state-owned Codelco, the world’s largest copper producer, will take more
time than expected, the country’s mining minister said on Tuesday.

* RIO TINTO BAUXITE: Rio Tinto said has suspended its Weipa mining
operations bauxite, the raw material used to make aluminium, at the
northeastern tip of the country ahead of a cyclone.

INVESTORS DIARY 2019

Company

Event

Venue

Date & Time

Dairibord

Analysts Briefing

Palm Court, Meikles Hotel, Harare

20 March 2019 3pm

CFI

AGM

Farm & City Boardroom, 1st Floor Farm & City Complex, 1 Wynne Street

26 March 2019 11am

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

 <mailto:info at bulls.co.zw> 

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