Bulls n Bears Daily Market Commentary : 25 March 2019

Tue Mar 26 06:41:12 CAT 2019

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Bulls n Bears Daily Market Commentary : 25 March 2019

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Zimbabwe Stock Exchange Update

Market Turnover RTGS$403,038.10 with foreign buys at RTGS$95,951.21 and
foreign sales were RTGS$23,884.59. Total trades were 72.

The All Share index recovered 0.24 points  to settle at 121.80 points. FIRST
MUTUAL HOLDINGS  led the movers with a $0.0173 gain to close at $0.1203, CBZ
HOLDINGS  put on $0.0100 to $0.1600 while INNSCOR  was $0.0288 higher at
$1.2847. Other gains were in ZIMPLOW HOLDINGS  which added  $0.0025 to end
at $0.2450 as mobile giant ECONET   advanced by $0.0056 to trade at $1.0058.

Losses were seen in four counters as OLD MUTUAL  came off $0.1268 to settle
at $7.1095, PADENGA eased $0.0250 to trade at $0.9550 whilst AXIA shed
$0.0099 to close at $0.3601.  TRUWORTHS  closed at $0.0160 following a
marginal loss of $0.0001.

 <mailto:info at bulls.co.zw> 

  Global Currencies & Equity Markets

South  Africa

South Africa's rand firms on weaker dollar, stocks fall

(Reuters) - South Africa’s rand firmed on Monday, gaining alongside other
emerging market currencies as concerns over a possible recession in the
United States dented the dollar.

Stocks weakened as sentiment for riskier assets dwindled with global stocks
under pressure as fears for economic growth sent investors to safe-haven
assets.

At 1505 GMT the rand was 0.97 percent firmer at 14.3500 per dollar compared
to a close of 14.4900 on Friday in New York.

Most developing world currencies firmed on Monday as the dollar took a back
seat after the U.S. yield curve inverted on Friday for the first time since
mid-2007, the strongest indication of a possible recession for the world’s
largest economy.

South African focused investors will this week keep a close eye on the
central bank interest rates decision on Thursday and a Moody’s ratings
review on Friday.

The South African Reserve Bank is expected to keep lending rates steady when
it concludes its second monetary policy meeting for the year on Thursday but
may strike a hawkish tone as oil and electricity prices climb.

South Africa’s economy has barely grown in the past decade with fiscal
missteps and corruption contributing to weak business and consumer
confidence.

The country has also experienced its worst power cuts in years this year as
state utility Eskom struggles with generation capacity shortages.

Bonds also firmed, with the yield on the benchmark paper due in 2026 falling
4 basis points to 8.71 percent.

On the bourse, the Johannesburg All-Share index fell 1.32 percent to 55,367
points and the Top-40 index was 1.27 percent weaker at 49,162 points.

Among the decliners on blue-chip index were Anglo American Platinum which
fell 4.57 percent to 796.86 rand, Tiger Brands which lowered 2.35 percent to
256.97 rand and MTN which closed down 3.10 percent to 90.60 rand.

Despite shares being were weaker across the board, the gold sector, which
ticked up 0.68 percent, offering some relief as they benefited from
safe-haven demand in times of risk-off sentiment. 

Kenya

Kenyan shilling firm against the dollar

(Reuters) - The Kenyan shilling was firm against the dollar on Monday with
inflows from horticulture exports and diaspora remittances meeting demand
from the energy sector, traders said. 

At 0649 GMT, commercial banks quoted the shilling at 100.60/80 per dollar,
compared with 100.70/90 at Friday's close.

       <mailto:info at bulls.co.zw> 

Asia

Asian shares edge up as U.S. bond yields come off late-2017 lows

(Reuters) - Asian shares bounced back on Tuesday after two days of losses as
U.S. 10-year Treasury yields edged higher, but the outlook remained murky as
investors weighed the odds of whether the U.S. economy is in danger of
slipping into recession.

MSCI’s broadest index of Asia-Pacific shares outside Japan rebounded 0.3
percent after losing 1.4 percent in the previous session.

Australian shares were flat, while Japan’s Nikkei jumped 1.8 percent after
recording its biggest drop since late December on Monday.

China’s blue-chip CSI300 and Hong Kong’s Hang Seng Index also rose, by 0.3
percent and 0.5 percent, respectively.

Wall Street shares were little changed on Monday with the S&P 500 ending
with a small loss of 0.08 percent.

U.S. stock futures rose, with E-Minis for the S&P 500 tacking on one-third
of a percent.

Investors have been spooked by sharp falls in U.S. bond yields and an
inversion of the U.S. Treasury yield curve, which is widely seen as an
indicator of an economic recession.

The 10-year U.S. Treasury yield edged up to 2.430 percent , having shed 5
basis points on Monday.

It has fallen about 18 basis points since the Federal Reserve last week
ditched projections for raising rates this year and announced the end of its
balance sheet reduction, citing signs of an economic slowdown.

The 10-year yield fell below the yield for three-month bills on Friday for
the first time since 2007, inverting the yield curve.

San Francisco Fed researchers have said that the difference in those two
maturities was the most useful for forecasting a recession.

FACTORING IN A RATE CUT

The Treasury Department will sell $113 billion in coupon-bearing supply this
week, including $40 billion in two-year notes on Tuesday, $41 billion in
five-year notes on Wednesday and $32 billion in seven-year notes on
Thursday.

Investors will also be watching Fed policymakers scheduled to speak on
Tuesday.

U.S. economic growth could be “pretty weak” in the first quarter but will
likely much closer to 2-2.5 percent for the rest of the year, but a central
bank pause is the responsible thing to do, Fed Bank of Boston president and
CEO Eric Rosengren said at a conference in Hong Kong.

Fed funds rate futures are now fully factoring in a rate cut later this
year, with about an 80 percent chance of a move priced in by September.

In the currency market, the fall in U.S. yields undermined the dollar’s
yield attraction.

The euro stood at $1.1315, having gained a tad on Monday after Germany’s IFO
Institute said its business climate index rose to 99.6, beating a consensus
forecast of 98.5 and ending six consecutive months of decline.

The dollar was a shade higher at 110.10 yen, after having hit a 1 1/2-month
low of 109.70 on Monday.

The British pound stood at $1.3195, erasing small gains made after lawmakers
voted to wrest control of the Brexit process from Prime Minister Theresa
May’s government for a day.

May said on Monday there was not yet enough support to put her Brexit deal
to a third vote in parliament.

Oil prices hovered below their recent four-month peaks, as the prospect of
tighter U.S. crude supply was offset by concerns about a slowdown in global
economic growth.

U.S. crude futures traded at $59.21 per barrel, up nearly 0.7 percent on
day, a tad below Thursday’s high of $60.39, its highest since mid-November.

Brent futures were up 0.2 percent at $67.33.

Gold was slightly lower at $1,320.90, not far off a near one-month peak of
$1,324.60 scaled during the previous session.

 <mailto:info at bulls.co.zw> 

Commodities Markets

METALS-London copper drifts as U.S. economy worries weigh

(Reuters) - London copper prices drifted in Asian trade on Monday as fears
of a recession in the United States were offset by a supply disruption at a
key copper mine in Peru.

The disruption at MMG's Las Bambas mine may add to supply concerns because
it is one of the world's top copper mines, she added.

Gold gains as U.S. recession fears lift safe-haven appeal

(Reuters) - Gold prices firmed on Monday as concerns about a potential U.S.
recession and decelerating global growth weighed on stock markets, which
increased appetite for safer assets.

FUNDAMENTALS

* Spot gold was up 0.1 percent at $1,314.21 per ounce as of 0128 GMT.

* The metal last week posted its third consecutive weekly gain and rose 1
percent, the most since the week ending Feb. 1.

* U.S. gold futures were up 0.2 percent at $1,314.40 an ounce.

* Investors dumped shares on Monday and fled to the safety of bonds, while
the Japanese yen hovered near a six-week high as risk assets fell out of
favour on growing worries about an impending U.S. recession, sending global
yields plunging.

* U.S. markets received a clear warning of coming recession on Friday when
the spread between yields on three-month Treasury bills and 10-year notes
fell below zero for the first time since 2007 after U.S. manufacturing data
missed estimates.

* U.S. manufacturing activity unexpectedly cooled in March, a troubling sign
for the economy although the housing market showed signs lower interest
rates were giving it a boost.

* Businesses across the euro zone performed much worse than expected this
month as factory activity contracted at the fastest pace in nearly six
years, hurt by a big drop in demand, a survey showed on Friday.

* British Prime Minister Theresa May held crisis talks with senior
colleagues and hardline Brexiteers on Sunday trying to breathe life into her
twice-defeated European divorce deal after reports her cabinet was plotting
to topple her.

* U.S. President Donald Trump said trade negotiations with China were
progressing and a final agreement “will probably happen,” adding that his
call for tariffs to remain on Chinese imported goods for some time did not
mean talks were in trouble.

* Hedge funds and money managers increased their bullish wagers in COMEX
gold by 15,971 contracts to 57,746 in the week to March 19, the U.S.
Commodity Futures Trading Commission (CFTC) said on Friday.

* Demand for physical gold moderated this week in India as many jewellers
held off on purchases ahead of the end of the country’s financial year to
pay off advance taxes, while premiums in Singapore rose slightly on tight
supplies.

* SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund,
said its holdings rose 0.4 percent on Friday.

INVESTORS DIARY 2019

Company

Event

Venue

Date & Time

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
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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