Bulls n Bears Daily Market Commentary : 09 May 2019

Fri May 10 08:17:33 CAT 2019

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Bulls n Bears Daily Market Commentary : 09 May 2019

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Zimbabwe Stock Exchange Update

Market Turnover RTGS$ 8,349,317.23 with foreign buys at RTGS$ 1,814,018.05
and foreign sales were RTGS$ 3,917,252.30. Total trades were 187.

The All Share index advanced further by 1.10 points  to close at 139.99
points. OLD MUTUAL LIMITED  added $0.0850 to end at $10.1168, BRITISH
AMERICA TOBACCO  and LAFARGE   both  rose by $0.0500 to settle at $30.0500
and $1.1500 respectively. AFRICAN SUN  also increased by $0.0253 to end at
$0.3000 and PADENGA  was $0.0248 firmer at $1.1348.

Gains were partially offset by losses in SEEDCO  which eased $0.0076 to
$1.4524, ECONET  dropped $0.0046 to close at $1.0954 and AMALGAMATED
REGIONAL TRADING  traded $0.0020 down at $0.1100. AXIA  also decreased by
$0.0008 to end at $0.4192.

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  Global Currencies & Equity Markets

South  Africa

South African rand, stocks weaker on renewed trade war

(Reuters) - South Africa’s rand gave up its earlier gains on Thursday as
another round of risk selling in global markets fuelled by the U.S.-China
trade talks outweighed local election positives.

Stocks fell as well, with Steinhoff being the biggest loser on the
Johannesburg all-share index.

The ruling African National Congress (ANC) is on course to retain power
after Wednesday’s election, though it may be the party’s worst performance
in a national vote since the end of white minority rule 25 years ago.

At 1540 GMT, the rand traded at 14.4175 per dollar, 0.21 percent weaker than
its New York close on Wednesday.

U.S. President Donald Trump said on Wednesday that China “broke the deal” it
had reached in trade talks with the United States, and vowed not to back
down on imposing new tariffs on Chinese imports unless Beijing “stops
cheating our workers.”

On the stock market, the main indexes touched a more than a one-month low on
risk-off trade. The Top-40 index was down 2.79 percent to 50,264 points,
while the broader all-share fell 2.67 percent to 56,496 points.

Shares in Steinhoff tumbled 20.40 percent to 1.60 rand after the retailer
reported a $4 billion operating loss in the 2017 fiscal year on Tuesday.

Sappi weakened 8.53 percent to 61.10 rand after the packaging and paper firm
reported a 11 percent decline in earnings before interest, tax, depreciation
and amortization, for the second quarter.

AngloGold Ashanti Ltd fell 1.44 percent to 168.74 rand after the gold miner
said it will review divestment options for its Mponeng mine and other South
African assets to focus on higher returns elsewhere.

In fixed income, the yield on the benchmark instrument due in 2026 was down
5 basis points to 8.55 percent. 

Kenya's shilling to strengthen, Uganda's to weaken

(Reuters) - Kenya’s shilling is forecast to strengthen against the dollar in
the next week to Thursday, while Uganda’s shilling will weaken, traders
said.

KENYA

The Kenyan shilling is expected to firm up, traders said, helped by
tightening liquidity in the money markets and inflows from offshore
investors buying government debt.

Commercial banks quoted the shilling at 101.00/20 per dollar, compared with
101.10/30 at last Thursday’s close.

UGANDA

The Ugandan shilling is forecast to weaken on the back of increased dollar
demand from importers and commercial banks.

Commercial banks quoted the shilling at 3,775/3,785, compared with last
Thursday’s close of 3,755/3,765.

Benon Okwenje, a trader at Stanbic Bank, said they expected the shilling
would remain on the weaker side since a recent surge in demand for hard
currency is likely to be sustained.

He didn’t indicate which players were exerting most demand but typically
much of the appetite for dollars in Uganda comes from fuel importers,
telecoms firms and manufacturers.

TANZANIA

The Tanzanian shilling is expected to gain next week due to the increase in
dollar inflows from the mining and agriculture sectors.

Commercial banks quoted the shilling at 2,298/2,310 compared with last
Thursday’s close of levels from 2,305/2,315.

ZAMBIA

The kwacha is likely to continue trading at current levels in the coming
week, supported by tax payments due on Tuesday.

Commercial banks quoted the currency of Africa’s second-largest copper
producer at 12.8400 per dollar, firmer than a year-high of 12.9300 a week
ago.

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Asia

Asian shares hit fresh 6-week lows ahead of crucial U.S.-China trade talks

(Reuters) - Asian shares hit six-week lows in early trade on Thursday as
increased tensions ahead of key Sino-U.S. trade negotiations fanned fresh
concerns about the outlook for the global economy.

Investor focus has zeroed in on trade issues this week with Chinese Vice
Premier Liu He expected to try to salvage a deal during negotiations with
the United States in Washington on Thursday and Friday. That would avoid a
sharp increase in tariffs on Chinese goods scheduled to take effect on
Friday.

MSCI’s broadest index of Asia-Pacific shares outside Japan edged down 0.3
percent to its lowest level since March 28.

Stocks extended earlier losses in Asian trade after President Donald Trump
said that China “broke the deal” in trade talks with Washington and would
face stiff tariffs if no agreement is reached.

Japan’s Nikkei average shed 0.9 percent to its five-week low, while South
Korea’s KOSPI fell 0.8 percent and the Australian benchmark added 0.3
percent.

Trump has threatened to raise tariffs to 25 percent from 10 percent on $200
billion worth of Chinese imports at 12:01 a.m. ET (0401GMT) on Friday.
Beijing has threatened to retaliate if tariffs rise, without elaborating on
the details.

Kazuhiko Fuji, senior fellow at RIETI, a Japanese government affiliated
think-tank, said the bilateral talks are looking fragile.

The yield spread between three-month bills and the 10-year notes shrank to 3
basis points, compared with about 15 basis points a few weeks ago.

The closely-watched spread turned negative in late March, spooking
investors, who read the development as portending a future recession.

The benchmark 10-year Treasury yield stood at 2.460 percent , having hit its
lowest level in five weeks of 2.426 percent on Wednesday.

Wall Street shares ended a choppy session flat to lower overnight, with the
Dow Jones Industrial Average rising marginally, the S&P 500 and the Nasdaq
Composite dropping 0.2 percent and 0.3 percent, respectively.

In the currency market, sterling weakened on signs that Brexit talks between
Britain’s government and the main opposition party may soon collapse.

The pound fell below the psychologically key $1.30 level, touching a six-day
low overnight, and last traded at $1.301 .

The dollar index against a basket of six major peers was flat, with other
major currencies also confined to well-trodden ranges. The euro was little
changed at $1.1194 and the Japanese yen little changed versus the greenback
at 109.96 yen.

In the commodity market, oil futures gained on Wednesday, boosted by a
surprise drawdown in U.S. crude stockpiles, but an escalating U.S.-Chinese
trade fight limited gains as investors worried about the global outlook for
energy demand.

Brent crude futures dropped 0.4 percent to $70.03 a barrel, while U.S. West
Texas Intermediate (WTI) crude also retreated 0.5 percent to $61.82 per
barrel.

Copper fell to a near three-month low on Wednesday on concerns over a
potential resumption of tit-for-tat trade tariffs between the United States
and China.

Benchmark copper on the London Metal Exchange fell 0.5 percent to $6,148 a
tonne, after touching its lowest since Feb. 15 at $6,119. 

 <mailto:info at bulls.co.zw> 

Commodities Markets

Copper rises on hopes of salvaging U.S.-China trade deal

(Reuters) - Prices of copper and most other industrial metals rose on hopes
of easing Sino-U.S. trade tensions, which have been threatening economic
growth, even as higher U.S. tariffs on more Chinese goods took effect on
Friday.

China appealed to the United States to meet it halfway to salvage a deal
that could end their trade war, after U.S. President Donald Trump ordered a
tariff hike, accusing China of reneging on commitments it had made in the
talks.

Investors were also relieved that Chinese Vice Premier Liu He went to
Washington to conduct talks with U.S. officials as scheduled, after worries
arose earlier in the week that he would not come, a trader and an analyst
said.

Liu and U.S. Trade Representative Robert Lighthizer and U.S. Treasury
Secretary Steven Mnuchin talked for 90 minutes on Thursday and talks will
resume on Friday.

Trump said on Thursday he believed it was possible to reach a deal this week
and that he might speak over the phone with Chinese President Xi Jinping.

Most base metals rallied strongly in early Asian trading hours, but then
retreated slightly as investors exercised more caution when tariffs on $200
billion worth of Chinese goods increased to 25 percent from 10 percent at
0401 GMT on Friday.

FUNDAMENTALS

* Benchmark copper rose 0.8 percent to $6,152 a tonne by 0406 GMT, but still
on track for its fourth straight weekly fall, while the most active Shanghai
copper contract was up 0.5 percent to 47,870 yuan ($7,027.92) a tonne.

* London nickel increased 1.3 percent, zinc advanced 1.2 percent, aluminium
edged up 0.6 percent, lead increased 1 percent, and tin rose 0.9 percent.

* ALUMINIUM: Rio Tinto, has begun shipping more aluminium to markets like
Europe to offset slowing demand from the United States partly caused by the
trade dispute, Chief Executive Jean-Sébastien Jacques said.

Gold prices buoyed as U.S.-China trade tensions mount

(Reuters) - Gold prices were steady on Friday, buoyed as investors shied
away from riskier assets amid worries that a rift over trade between the
United States and China could deepen if talks between the two fail to reach
a deal.

FUNDAMENTALS

* Spot gold was steady at $1,284.65 per ounce at 0142 GMT and is up about
0.4 percent for the week.

* U.S. gold futures were unchanged at $1,285.70 an ounce.

* Top U.S. and Chinese trade negotiators concluded the first of two days of
talks on Thursday to rescue a trade deal that is close to collapsing as
Washington prepares to go ahead with plans to hike tariffs on hundreds of
billions of dollars of goods imported from China. {nL2N22L1EY]

* Before they get back around the table on Friday, the United States will
have increased duties on $200 billion of Chinese goods, to 25 percent from
10 percent. The duties apply to cargoes leaving China after 12:01 a.m. EDT
(0401 GMT) Friday.

* The Japanese yen and the Swiss franc stood tall on Friday, supported by
investor concerns in the broader markets over the Sino-U.S. trade tensions.

* Asian shares inched up from two-month lows on Friday just hours ahead of
the Trump administration’s plan to raise tariffs on Chinese imports.

* Sudanese Rapid Support Forces seized 241 kilograms of gold from a plane
that landed in Khartoum on Thursday in an investigation into possible
smuggling.

* South Africa’s gold output fell 17.7 percent year-on-year in March
compared to a contraction of 20.6 percent in February, Statistics South
Africa said.

* AngloGold Ashanti Ltd will review divestment options for its Mponeng mine
and other South African assets to focus on higher returns elsewhere, the
South African gold miner said on Thursday.

* Spot palladium rose 1.8 percent to $1,316.40 an ounce, having fallen as
much as 4 percent in the previous session to its lowest since Jan. 4 at
$1,263.85.

INVESTORS DIARY 2019

Company

Event

Venue

Date & Time

Africa Day

25 May 2019

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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
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whatsoever for any loss howsoever arising from any use of this report or its
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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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