Major International Business Headlines Brief::: 10 August 2020

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Major International Business Headlines Brief::: 10 August 2020

 


 

 


 <mailto:info at bulls.co.zw> 

 


 

 


 

 

ü  Botswana diamond exports fall by two thirds on COVID-19

ü  Egypt's annual urban consumer price inflation fell to 4.2% in July -
CAPMAS

ü  World Bank approves $114 mln for Nigeria's COVID-19 response

ü  AngloGold Ashanti moots higher dividend as gold price boosts earnings

ü  Co-op Bank Kenya to complete Jamii Bora Bank acquisition this month
-central bank

ü  Record bullion prices give South African gold miners a lifeline, risks
remain

ü  Twitter 'looking' at a possible TikTok tie-up

ü  Microsoft's TikTok Bid Spotlights Windows Maker's History With China

ü  Oil prices rise 1% on Saudi Aramco's upbeat demand view, Iraq output cut

ü  Apple, Absolut Vodka and Reebok: What brands are doing for International
Women’s Day

ü  Stock futures mixed after Trump signs orders extending coronavirus relief

ü  The end of $600 unemployment boost and slim job prospects leaves many
struggling to survive

ü  Buffett buys back record $5.1 billion in Berkshire stock as coronavirus
hits operating earnings

 


 <mailto:info at bulls.co.zw> 

 


 

Botswana diamond exports fall by two thirds on COVID-19

GABORONE (Reuters) - Botswana’s rough diamond exports plunged 68% percent in
the second quarter of the year, data published by the central bank showed on
Friday, as the Coronavirus pandemic hit demand while global travel
restrictions hurt trading.

 

In a bid to curb the spread of the virus, Botswana closed its borders in
March, locking out international buyers from centres such as Mumbai, Antwerp
and China who traditionally travel to Gaborone ten times a year to view and
buy diamonds.

 

Exports of diamonds from Debswana, a joint venture between Botswana and
diamond mining giant De Beers, a unit of Anglo American, stood at $293
million in the second quarter of 2020, from $916 million in the preceding
period.

No exports were recorded in May, while only $20 million worth of diamonds
were exported in June, the Bank of Botswana’s data showed.

 

De Beers, which gets about 70% of its supply from Botswana registered a net
loss of $214 million in the first half of the year, as rough sales plunged
by more than half to $1 billion, the company said in its results last week.

 

The fall in diamond exports is expected to hurt Botswana’s balance of
payments deficit, as diamonds constitute 70 percent of the country’s
exports.

 

Through the partnership with De Beers, Botswana also gets about 30% of its
fiscal revenues from diamonds. It has so far recorded just 800 COVID-19
cases and only two deaths, but its economy has been severely hit.

 

($1 = 11.7925 pulas)

 

 

 

Egypt's annual urban consumer price inflation fell to 4.2% in July - CAPMAS

CAIRO (Reuters) - Egypt’s annual urban consumer price inflation fell to 4.2%
in July from 5.6% in June, the central statistics agency CAPMAS said on
Monday.

 

Month on month inflation increased to 0.4% in July from 0.1% in June, the
agency said.

 

 

 

World Bank approves $114 mln for Nigeria's COVID-19 response

ABUJA (Reuters) - The World Bank has approved $114 million to help Nigeria
tackle its coronavirus pandemic, the global lender said on Friday.

 

The money comes in the form of a $100 million loan and a $14 million grant
to be split between Nigeria’s 36 states and federal-level procurement of
medical equipment, tests and medicine.

 

Africa’s most populous country has recorded more than 45,000 confirmed
coronavirus cases and 930 deaths, but low levels of testing have left a
muddy picture of the outbreak’s severity.

 

“Nigeria has ramped up its efforts to contain the COVID-19 outbreak, but
more needs to done at the state level, which are at the front line of the
response,” Shubham Chaudhuri, the World Bank’s director for Nigeria, said in
its statement on Friday.

 

 

 

AngloGold Ashanti moots higher dividend as gold price boosts earnings

JOHANNESBURG (Reuters) - AngloGold Ashanti said on Friday it would consider
paying a higher annual dividend after reporting a more than 200% jump in
first-half earnings, driven by higher gold prices and a weaker local
currency.

 

AngloGold, which has operations in Australia, Brazil and Tanzania, said its
headline earnings per share for the six months ended June rose 234% to 97
cents against 29 cents a year earlier, despite output disruptions caused by
COVID-19.

 

Earnings before interest, taxes, depreciation and amortisation (EBITDA)
climbed 59%.

 

“Cash flows are extremely robust, demonstrating the significant operating
leverage we have to this strong gold price,” Chief Executive Kelvin
Dushnisky said.

 

Dushnisky, who steps down in September, said the company would focus on
cutting costs and capital management as it seeks to widen margins and
increase reserves through exploration and expansions.

 

Spot gold has roared past $2,000 an ounce for the first time, giving South
African gold miners a lifeline after the disruption caused by the COVID-19
pandemic.

 

AngloGold, which pays an annual dividend of 10% of its free cash flow before
growth capital, said free cash flow had increased more than four-fold to
$324 million.

 

“If gold prices stay at these levels, and we continue to manage our margins
well and we continue to generate increasing free cash flow, we will see
increased dividends,” Dushnisky said in an interview.

 

If prices remained supportive and the company strengthens its balance sheet,
the board could also consider changing its dividend policy, Dushnisky said.

 

The bullion miner, which is completing the sale of its last South African
assets, said it had lost around 85,000 ounces of output due to COVID-19,
with 63,000 ounces of that from South Africa.

 

Production during the period was 1.469 million ounces compared to 1.554
million ounces for the first six months of last year.

 

Dushnisky said the board was considering moving its primary listing from the
Johannesburg Stock Exchange but its current focus was navigating the
pandemic.

 

 

 

Co-op Bank Kenya to complete Jamii Bora Bank acquisition this month -central
bank

NAIROBI (Reuters) - Co-operative Bank of Kenya will buy 90% of micro lender
Jamii Bora Bank and the deal will complete this month, the country’s central
bank said on Friday, marking further consolidation in the East African
nation’s banking industry.

 

Co-op Bank’s takeover of Jamii Bora was first announced in March and the
deal is due to complete on Aug. 21, the central bank said.

 

Co-op Bank, owned by Kenya’s co-operative movement, is the country’s
third-biggest bank by market share with nearly 10% of the domestic market
and 159 branches across Kenya and South Sudan.

 

Jamii Bora, which is mainly focused on lending to micro-enterprises, is the
second-smallest lender in Kenya with a market share of 0.09% and 17 branches
across the country.

 

“This transaction...will (enhance)... the resilience of the Kenyan banking
sector,” the central bank said in a statement.

 

There are 39 banks competing in Kenya’s banking sector which has seen
several mergers and acquisitions since 2016, sparked by the failure of three
mid-sized and small lenders, as well as a cap on commercial lending rates,
which was removed last November.

 

Last year KCB Group took over National Bank of Kenya, while CBA Group merged
with NIC Bank to form NCBA.

 

The central bank said on Friday that its review of the banking sector’s
business models and consolidation, “have been beneficial in enabling the
sector to ride through the (coronavirus) pandemic period while supporting
their customers and the economy.”

 

 

 

Record bullion prices give South African gold miners a lifeline, risks
remain

JOHANNESBURG (Reuters) - South African gold miners are looking to cut debt
and boost dividends as bullion hits record highs, with analysts and fund
managers predicting a sectoral growth spurt over the next two years amid
rising investor interest.

 

Shunned by investors due to mines that are old, deep, and difficult to
extract, the country’s gold miners have traded at a discount to their global
peers for years.

 

Higher prices, as spot gold roared past $2,000 an ounce for the first time,
coupled with a weaker rand currency, comes as a lifeline.

 

Interviews with companies executives, analysts and fund managers show that
higher gold prices could see some local miners bring their net debt to zero
and pay healthy dividends over the next 18 to 24 months.

 

“Gold mining companies will spew a lot of cash in the next 12 months,” said
Franco Lorenzani, an independent mining analyst.

 

    Sibanye Stillwater, which has battled high debt, said it achieved its
leverage target in the first quarter, ahead of plan.

 

Its net debt, which stood at 20.964 billion rand ($1.2 billion) in 2019,
dropped 40% year-on-year in the first quarter.

 

Higher prices have also made more marginal ounces profitable for Sibanye,
spokesman James Wellsted told Reuters, adding the company was looking at
other ways to benefit from favourable market conditions.

 

“Maybe mining secondary reefs ... might be viable at these prices,” said
Wellsted.

 

Pan African Resources is hoping to be net debt free by June 2021 and plans
to increase its dividend payout to 5% from 1% last year, its head of
investor relations Hethen Hira said. Its net debt dropped 49% to $62.5
million at end December.

 

Gold Fields has flagged hefty gains from the gold rally, with half-year
profits seen up more than 300%.

 

Rene Heichreiter of Noah Capital said he was advising his clients to
continue to invest in local gold miners, predicting a exponential jump in
revenues in the coming months.

 

Some investors have already turned bullish.

 

Factsheets of fund managers seen by Reuters show South Africa’s Fairtree
increased its exposure to Harmony Gold by 0.78% between March and June,
while U.S.-based ASA Ltd, which invests in gold mining companies globally,
increased its investments in South Africa to 10.7% in June from 9.9% in
January.

 

But the operating environment remains risky.

 

While power cuts and regulatory uncertainty have always hung over
operations, the mining sector is also battling rising COVID-19 cases in
underground mines where social distancing is a challenge.

 

This could threaten output, as some analysts warn the frenzy over high
prices could backfire as investments add to costs.

 

“Whenever the gold prices go up the costs tend to go up with it,” said
Nedbank mining analyst Arnold Van Graan.

 

($1 = 17.5317 rand)

 

 

 

Twitter 'looking' at a possible TikTok tie-up

Twitter has approached TikTok's Chinese owner ByteDance to express an
interest in buying its US operations, according to reports.

 

Video-sharing platform TikTok has been at the centre of fierce debate in
recent weeks and takeover talk.

 

Last week US Donald Trump ordered firms to stop doing business with TikTok
within 45 days over security concerns.

 

Tech giant Microsoft is the front-runner to buy TikTok but now Twitter has
emerged as a possible suitor.

 

But it remains unclear whether Twitter can afford to buy TikTok from its
Chinese owners and can complete a deal within the 45-day window, according
to sources quoted in the Wall Street Journal.

 

The value of TikTok's US operations are unclear but estimates put it at tens
of billions of dollars.

 

Twitter's market capitalisation is about $29bn (£22bn), dwarfed by
Microsoft's at more than $1.6tn.

 

But experts believe a possible Twitter deal would face less regulatory
scrutiny than Microsoft's.

 

A Twitter spokesman declined to comment on a possible deal while TikTok
didn't respond immediately when contacted by the BBC.

 

'Shocked'

Last Friday, Mr Trump ordered US firms to stop doing business with the
Chinese app within 45 days. The Trump administration claims that the Chinese
government has access to user information gathered by TikTok, which the firm
has consistently denied.

 

In response to the US president's executive order, TikTok has threatened
legal action against the US saying it was "shocked" by the move.

 

The US government also unveiled a ban on Chinese-owned messaging app WeChat
as tensions escalate between the two countries.

 

Mr Trump said last week he would support Microsoft's efforts to buy TikTok's
US operations if the government got a "substantial portion" of the proceeds.

 

He has set a deadline of 15 September for the deal to be completed or the
ban will go ahead.

 

Microsoft said it "will move quickly to pursue discussions" for TikTok's
operations in the US, Australia, Canada and New Zealand.

 

"Even if the deal goes through, be it Microsoft or Twitter taking a
substantial stake in TikTok, what remains to be seen is how both parties are
going to move forward operationally," said communications expert Sharon Koh.

 

"It will also take a tumultuous effort for both organisations to meander
through the political sensitivities," she added.--BBC

 

 

 

Microsoft's TikTok Bid Spotlights Windows Maker's History With China

Microsoft Corp has emerged as the most likely buyer of the US operations of
TikTok, the popular Chinese short-video app that US President Donald Trump
is preparing to effectively ban on national security grounds.

 

A deal would be in line with Microsoft's stance toward China where the firm
has a sizeable presence - unlike fellow US tech heavyweights such as
Facebook and Alphabet's Google which appear to have given up on China's
consumer-facing market with its miscellany of government strictures.

 

The country accounts for over $2 billion (roughly Rs. 14,983 crores) in
annual revenue, Microsoft President Brad Smith said earlier this year.

 

Microsoft Could Be 'White Knight' for TikTok -- or Fall Flat

What does Microsoft do in China?

Microsoft employs roughly 6,000 people in the country, with offices in
Shanghai, Beijing, and Suzhou.

 

Its flagship Windows operating system is widely used, though revenue has
long been crimped by piracy. In recent years the firm has pushed its Azure
cloud computing product, launched in 2013 via a partnership with local data
service company 21Vianet.

 

China's cyber-security law limits Microsoft to providing Azure's software
and services while 21Vianet runs associated data centres. It is a small
player in a sector dominated by local providers Alibaba Group Holding,
Baidu, Tencent Holdings, and Huawei Technologies Co.

 

TikTok Grab Could Extend -- or Undermine -- US Online Dominance

Microsoft operates both its Bing search engine and LinkedIn social network
in China, though again is a small player compared with local giants.

 

Its most important China operation is arguably the Microsoft Research Asia,
famous as a leader in artificial intelligence (AI).

 

Founded in 1998 with help from renowned Taiwanese-American AI scientist
Kaifu Lee - who went on to lead Google's China office - the lab has produced
alumni who went on to become executives at TikTok owner ByteDance, Baidu,
Xiaomi, and Chinese facial recognition unicorns.

 

Does Microsoft self-censor in China?

Bing and LinkedIn in China appear similar to their global counterparts but
Microsoft censors search results and content the Chinese government
considers sensitive.

 

Upon LinkedIn's China launch in 2014, two years before the company was
bought by Microsoft, then-Chief Executive Jeff Weiner said censoring content
would be "necessary" for the firm to grow in the country.

 

In 2019, free speech advocates criticised LinkedIn's position on censorship
after human rights activist Zhou Fengsuo said his profile was not viewable
in China. LinkedIn blamed an "error" and restored its visibility.

 

Software development website GitHub, which Microsoft purchased in 2019, is
also accessible from China. The site, a coding repository, has been used by
activists in China to preserve internet content before authorities censor
the source.

 

Has Microsoft had scrapes with China's government?

Microsoft has bemoaned rampant piracy of Windows in China for decades and
has occasionally filed lawsuits and complaints even against state-backed
companies to address its concerns.

 

Its most notable tussle with the government was in 2014 when authorities
raided four Microsoft offices demanding access to contracts and other
information as part of an anti-trust investigation.

 

The same year, the government called on all agencies to ban the purchase of
Windows 8 citing security reasons.

 

Microsoft eventually released a "China Government" edition of Windows 10
following a joint venture formed in 2015 with state-owned China Electronics
Technology Corp.

 

What about Bill Gates?

Microsoft co-founder Bill Gates has spoken in mostly positive terms about
China in recent years. In November, he held a public meeting with Peng
Liyuan, wife of President Xi Jinping.

 

Also late last year, Gates criticised the US government's restrictions on
telecommunications equipment maker Huawei and spoke about sharing Windows
source code with China's government which aided official acceptance of the
software in the country.

 

He has praised China's response to COVID-19, which earned him public thanks
from Xi, and the Bill & Melinda Gates Foundation has donated $5 million
(roughly Rs. 37.44 crores) to China for COVID-19 relief.

 

The foundation is one of few overseas charities or non-governmental
organisations to maintain operations in China, where it has worked with the
government and academic institutions against diseases such as malaria and
tuberculosis.--Thomson Reuters 2020

 

 

Oil prices rise 1% on Saudi Aramco's upbeat demand view, Iraq output cut

MELBOURNE: Oil prices climbed on Monday (Aug 10), supported by Saudi
optimism on Asian demand and an Iraqi pledge to deepen supply cuts, although
uncertainty over a deal to shore up the US economic recovery capped gains.

 

US West Texas Intermediate (WTI) crude futures rose US$0.50, or 1.2 per
cent, to US$41.72 a barrel at 3.01am GMT, while Brent crude futures were up
US$0.40, or 0.9 per cent, at US$44.80 a barrel.

 

Both benchmark contracts fell on Friday, hurt by demand concerns, but Brent
still ended the week up 2.5 per cent, with WTI up 2.4 per cent.

 

"Comments from the weekend from Aramco are the driver at the moment," said
Michael McCarthy, market strategist at CMC Markets and Stockbroking.

 

Saudi Arabian Aramco's Chief Executive Amin Nasser said on Sunday he sees
oil demand rebounding in Asia as economies gradually open up after the
easing of coronavirus lockdowns.

 

"He painted a rosy picture on the outlook for demand in the Asian region,"
McCarthy said.

 

On the supply side, Iraq said on Friday it would cut its oil output by a
further 400,000 barrels per day in August and September to compensate for
its overproduction in the past three months. The move would help it comply
with its share of cuts by the Organization of the Petroleum Exporting
Countries and their allies, together called OPEC+.

 

The sharper cut will take Iraq's total reduction to 1.25 million barrels per
day this month and next.

 

"Saudi Arabia and Iraq forging better relationships over the oil deal are
excellent for the compliance outlook," AxiCorp market strategist Stephen
Innes said in a note.

 

The Saudi and Iraqi energy ministers said in a joint statement that OPEC+
efforts would improve the stability of global oil markets, accelerate its
balancing and send positive signals to the markets.

 

While hopes grew on stalled talks between US Democrats and the White House
on a new support package for cash-strapped US states hit by the coronavirus
pandemic, delays in reaching a deal weighed on the market.

 

US House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin both
said they were willing to restart talks on a deal to cover the rest of 2020.

 

"The longer this drags on the worse it is for the demand scenario," McCarthy
said.-Reuters/dv

 

 

 

Apple, Absolut Vodka and Reebok: What brands are doing for International
Women’s Day

International Women’s Day is a chance for brands to show what they’re doing
to promote equality — and arguably raise their profiles and sell more too. 

 

CNBC takes a look at what some businesses are doing to mark the occasion
Sunday, from Betty Crocker’s response to an eight year-old boy who realized
its cake instructions were aimed at women, to Absolut’s campaign around
sexual consent.

 

Apple

“We teach girls to shrink themselves, to make themselves smaller. We say to
girls, you can have ambition, but not too much,” goes the soundtrack to
Apple’s “Behind the Mac” ad on YouTube, released Tuesday.

 

It’s a compilation of pictures of women, including campaigner Malala
Yousafzai, soccer star Megan Rapinoe and #MeToo movement founder Tarana
Burke. They’re shown working on Macs, and the song uses words from
Chimamanda Ngozi Adichie’s TEDx talk, “We Should All Be Feminists,” which
was sampled by Beyonce in her song “Flawless.” The company is also running
events in-store highlighting women creatives.

 

Apple international women's day

Despite some moves forward for women in the Middle East, packs of Betty
Crocker cake mix still used stereotypes, addressing only women in their
instructions. That changed when eight-year-old Sultan, living in Ras al
Khaimah, tweeted Betty Crocker to ask: “Why do your baking instructions only
speak to women?” The General Mills-owned brand updated the Arabic
instructions on more than 100 products to gender-neutral nouns and verbs and
launched its “The Kitchen is for Everyone” ad campaign, by agency VMLY&R, on
Tuesday, which will run on social media in the region.

 

Words create stereotypes, and adjectives like “cold,” “pushy,” and
“aggressive,” are labels that are often used to describe women in the
workplace, whereas “assertive” might be used instead of “aggressive” for a
man exhibiting similar behavior, according to non-profit Catalyst. It is
seeking to tackle unconscious bias with a software plug-in for Slack that
suggests alternative adjectives, and is also encouraging men and women to
tweet pictures of themselves with words that have been used to describe
them.

 

Absolut

The Swedish alcohol brand launched a campaign called “Drink Responsibly.
#SexResponsibly,” on Valentine’s Day with ads stating: “Buying someone a
drink doesn’t buy you a yes,” and it aims to continue the conversation ahead
of International Women’s Day. It is working with influencers to share
stories on social media tagged #StillNotAYes and is running an event on
March 12 where actress and producer Olivia Wilde and others will discuss
consent. It has launched the campaign with RAINN, the Rape, Abuse & Incest
National Network.

 

Absolut

Intrepid Travel

When tour company Intrepid Travel realized that most of its trip leaders
were men, it sought to equalize the imbalance, noting that 65% of its
customers are female. Zina Bencheikh, general manager of Intrepid Travel’s
Morocco office, successfully lobbied for the country to license more female
tour guides and this week the business launched women-only tours to
Pakistan, Israel and the Palestinian Territories. It plans to report on its
progress towards equality by 2022.

 

Intrepid Travel has launched women-only trips to Pakistan.

Intrepid Travel has launched women-only trips to Pakistan.

Time magazine was “created by men for ‘busy men,’” and it named its annual
“Man of the Year” in 1927, only changing it to “Person of the Year,” in
1999, according to its executive editor, Kelly Conniff. Now, Procter &
Gamble is backing Time’s release of 100 influential “Women of the Year”
profiles, including the likes of campaigner Greta Thunberg, author Toni
Morrison and chemist Rosalind Franklin, and has sponsored a documentary on
how the women were selected. P&G brands that will advertise in the printed
issue include Pampers, Olay and SKII.

 

Time

Kind

Kind held around 10% of the U.S. market share for snack bars in 2019,
according to Euromonitor, and this year it has decided to get political for
International Women’s Day. It is running a petition to campaign for the
Equal Rights Amendment (ERA) to go ahead — a change to the constitution that
was proposed in 1972 and is now back before Congress. It will also donate
profits from its limited-edition “Equality” bar to the Alice Paul Institute,
which is campaigning for the ERA to be ratified. Bars can be bought via its
website, where it sells multi-boxes and subscriptions.

 

Reebok

“It’s a Man’s World” might seem like a counter-intuitive name for a women’s
product range, but Reebok did just that when it launched a collection
designed by women, with the phrase crossed out on its footwear. Reebok,
owned by Adidas, just dropped its 2020 “It’s a Man’s World” collection ahead
of International Women’s Day.

 

Anti-poverty non-profit Care has created a public service announcement-style
ad featuring “Scandal” creator Shonda Rhimes. Rhimes and its stars, Kerry
Washington, Bellamy Young and Katie Lowes, describe the ways in which women
are marginalized. The aim is to have people sign a petition to support the
Safe From The Start Act, legislation that would require U.S. humanitarian
programs overseas to prioritize the needs of women and girls.

 

"Scandal" creator Shonda Rhimes and star Kerry Washington pose as part of a
campaign by non-profit Care for International Women's Day.

“Scandal” creator Shonda Rhimes and star Kerry Washington pose as part of a
campaign by non-profit Care for International Women’s Day.

Care

Narendra Modi

He’s not exactly a brand, but India’s Prime Minister tweeted that he will
“give away” his social media accounts to women who are inspiring and is
asking people to enter a competition to run his Twitter, Facebook, Instagram
and YouTube accounts on Sunday.--CNBC

 

 

 

Stock futures mixed after Trump signs orders extending coronavirus relief

U.S. stock futures were mixed early Monday morning after President Donald
Trump signed several executive orders aimed at extending coronavirus relief.

 

Dow Jones Industrial Average futures were up 76 points at of 12:09 a.m. ET
on Monday, indicating a gain of about 66 points at market open. S&P 500
futures also pointed to opening gains while Nasdaq 100 futures were
marginally lower. 

 

Those orders continue the distribution of expanded unemployment benefits,
defer student loan payments through 2020, extend a federal moratorium on
evictions and provide a payroll tax holiday. However, the unemployment
benefit will be continued at a reduced rate of $400 per week. Originally,
the benefit provided workers impacted by the pandemic with $600 per week.

 

Trump’s moves come after congressional leaders failed to make progress on a
new coronavirus stimulus package last week. Several benefits from a package
signed earlier in the year lapsed at the end of July, raising uncertainty
about the U.S. economy moving forward.

 

“The fiscal cliff still represents downside risk for August,” said Aneta
Markowska, chief financial economist at Jefferies. Markowska added, however,
any weakness from this will be “short-lived.”

 

“By September, another round of fiscal support will create positive
momentum. The reopening of schools, even if only in some states, will
reinforce the positive momentum by (1) boosting back-to-school shopping and
(2) allowing more parents to return to work in September,” she said in a
note to clients. “Bottom line, all the stars are lining up for another
inflection point in activity and a second leg up in the reopening.”

 

Wall Street was coming off a strong weekly performance. The Dow rose 3.8%
last week for its biggest weekly gain since June. The S&P 500 climbed 2.5%
along with the Nasdaq Composite. Last week’s gains come during a
historically tough time for the market as August kicks off the worst
three-month stretch for the S&P 500.

 

Those gains were led in part by Facebook, Apple and Microsoft, all of which
rose by more than 3% last week. They also left the S&P 500 just 1.2% below
its Feb. 19 record high.--cnbc

 

 

 

The end of $600 unemployment boost and slim job prospects leaves many
struggling to survive

Bianca Thomas was always working. Except on Sunday — that was church day.

 

But in March, everything changed. Thomas lost her job as a prep cook in an
eatery catering to Boston Bruins and Celtics season ticket holders. Singing
in the church choir, a joy of hers for 13 years, wasn’t possible because of
the coronavirus pandemic.

 

A $600-a-week boost to unemployment benefits helped pay the bills, though.
Thomas, 60, even managed to pay a few months of rent and phone bills in
advance.

 

But that federal subsidy ended at the end of July – leaving Thomas, who
lives in Boston, with just $126 a week in state aid from Massachusetts. She
lives alone and doesn’t have savings to fall back on.

 

After buying groceries on Wednesday, she had $9 left. That will have to last
until another unemployment check comes on Tuesday.

 

“I don’t know what tomorrow promises,” Thomas said. “And it’s so scary.

 

“I have so much faith, but I still get scared because I don’t know what this
will bring,” she added.

 

$308 a week

More than 30 million Americans are collecting jobless benefits, according to
the U.S. Department of Labor. That’s about five times the peak of the Great
Recession.

 

These individuals all lost the $600 federal weekly supplement at the end of
July.

 

Like Thomas, they must now make ends meet with a weekly allotment from their
state, as Congress continues to hash out the contours of another financial
relief measure.

 

In June, states paid $308 a week, or about $1,230 a month, on average,
according to the Labor Department. Some states pay as little as $5 or $10 a
week.

 

There’s no guarantee any additional aid is forthcoming. Lawmakers are at
loggerheads over the scope of a bill.

 

Democrats want to extend the $600 boost. The House passed a bill in May to
continue the aid through early next year. Senate Republicans recently
countered with a plan to cut aid to $200 a week, calling the former policy a
disincentive to work.

 

‘They’ll really suffer’

Meanwhile, the unemployment rate is higher than the peak during the 2008-09
financial crisis (10.2% versus 10%, respectively).

 

While businesses added more than 9 million jobs to their payrolls since May
as states gradually reopened, there remain nearly 13 million fewer jobs than
before the coronavirus-fueled recession. The pace of job growth showed signs
of slowing last month and more than 1 million Americans continue to apply
for jobless benefits each week.

 

More from Personal Finance: 

Unemployment fell in July. Here’s why that’s important

Americans reel as $600 jobless benefit disappears

5 ways to create your own stimulus check

 

There were about four unemployed people for every job opening in May,
according to latest data from the Bureau of Labor Statistics.

 

This all amounts to a tough spot for many of the country’s unemployed —
little jobless aid and not enough jobs to go around.

 

A federal moratorium on evictions ended at the end of July, as have similar
protections in around 30 states — meaning millions of people late on rent or
housing payments stand to get evicted in coming weeks.

 

 

 

“We’ve cut many, if not most, people’s unemployment benefit to below the
equivalent of $10 an hour,” said Betsey Stevenson, an economics and public
policy professor at the University of Michigan and former chief economist at
the Labor Department.

 

“If you’re dealing with people who didn’t have a lot of savings or a buffer
to begin with, they’ll really suffer unless they get some additional help,”
Stevenson said.

 

‘I can’t survive’

A $600 unemployment boost ended in July.

Shane Rybacki, a 32-year-old from Austin, Texas, lost his job in March. He’s
getting just $104 a week in unemployment benefits from the state, absent a
$600 federal supplement that expired in late July. He and his fiancé,
Kristen, are expecting their first child on Aug. 23.

Shane Rybacki

Shane Rybacki and his fiancé are expecting their first child on Aug. 23.

 

But money is tight, and Rybacki is worried.

 

The 32-year-old Austin, Texas, resident lost his job in March driving for
Break It Down, which manages recycling and composting pickups in the area.

 

Rybacki’s fiancé also left her job weeks ago, without paid leave, due to the
pregnancy.

 

The couple has been able to make ends meet due to Rybacki’s $644 a week in
unemployment benefits, roughly equivalent to the $16 an hour he was getting
at work.

 

But losing the federal subsidy cut their aid to $104 a week, after taxes,
from Texas — amounting to an 84% cut to their cash flow.

 

 

 

The family had been living paycheck to paycheck even prior to the lapse in
federal benefits and they only have $700 left in the bank. Now, state
benefits aren’t even enough to cover their $600 monthly rent. They have
medical coverage through Medicaid, but Rybacki is concerned some hospital
costs associated with child delivery may not be covered.

 

“I have a kid coming,” Rybacki said.  “I need money to feed him and clothe
him.”

 

I wasn’t prepared to have no money at all,” he added. “Not only can I not
work, I can’t survive.”

 

More than enough

Some out-of-work Americans aren’t necessarily in dire straits without the
$600 supplement.

 

The case of Lawrence, 64, a resident of Honolulu, illustrates how divergent
some experiences can be. (He requested his last name not be used, for
privacy reasons.)

 

Lawrence took a voluntary furlough in April from Hawaiian Airlines, where he
was a crew scheduler. That temporary layoff is supposed to last until Oct.
1.

 

Even without the extra $600, he is collecting $648 a week from Hawaii, which
is the state’s maximum weekly payment.

 

“I hope someone [in Washington] has sympathy, pity, on us little people.
We’re not wealthy. We’re poor, middle-class people.

Bianca Thomas

UNEMPLOYED PREP COOK IN BOSTON

It’s more than enough for Lawrence to live on. He moved back home to care
for his mother, and has low living expenses, he said.

 

Hawaii is the most generous in the nation with respect to unemployment
benefits, Labor Department data show. In June, the state paid recipients
$456 a week, on average. On the other hand, Louisiana paid an average $183 a
week, the lowest amount.

 

“The states just vary enormously,” Stevenson said of their unemployment
payments.

 

The differences aren’t solely attributable to relative wages paid in the
state, she said. That means lawmakers’ generosity, and not just cost of
living, is a factor.

 

How to make money if you can’t file for unemployment

A ‘miracle’

Rybacki has been looking for a new job — to no avail.

 

“They’re really hard to come by right now,” he said. “At this point, I’d
pretty much be willing to do anything.”

 

Meanwhile, Rybacki has been able to stay afloat by reselling old fitness
equipment. He scours Facebook Marketplace for good deals, sometimes fixing
broken items. He recently bought a treadmill for $50 and sold it for $200,
he said.

 

“I’ve been getting lucky,” he said. “I had to figure something out.”

 

The job market has also been tough for Thomas, the prep cook from Boston.

 

Her industry, food service, has been among the hardest-hit by the pandemic
and she’s afraid of taking a more customer-facing role, like a cashier, for
fear of getting sick.

 

“I hope someone [in Washington] has sympathy, pity, on us little people,”
Thomas said of an extension to federal unemployment aid. “We’re not wealthy.
We’re poor middle-class people.”

 

Despite her financial hardship, Thomas is resolved to maintain a positive
disposition.

 

Her faith may be paying dividends.

 

As we chatted, Thomas received a surprising notification on her phone — one
of her choir sisters, who learned of her financial situation, wired over $21
through a cash payment app. Now, she could afford the allergy medication she
hadn’t been able to afford earlier that day.

 

“I have $30 now,” Thomas said. “I would call that a miracle.”--cnbc

 

 

 

Buffett buys back record $5.1 billion in Berkshire stock as coronavirus hits
operating earnings

Berkshire Hathaway announced on Saturday it bought back a record amount of
its own stock during the second quarter as the coronavirus pandemic dented
operations for Warren Buffett’s conglomerate. 

 

The company said it repurchased $5.1 billion worth in stock in May and June.
Berkshire repurchased more than $4.6 billion of its Class B stock and about
$486.6 million in Class A shares.

 

The share repurchase is the most ever in a single period for Buffett, nearly
double the $2.2 billion the conglomerate bought back in the final quarter of
2019. In fact, the amount is slightly more than what Buffett spent buying
back Berkshire stock in all of 2019. Despite the company’s record buybacks
last quarter, the Berkshire’s cash hoard grew to more than $140 billion.

 

Berkshire Class A and Class B shares plunged more than 19% in the first
quarter and lagged the S&P 500 during the second quarter with declines of
more than 1%.

 

Those buybacks come during a tough period for some of Berkshire’s wholly
owned businesses as the pandemic thwarted economic activity in the U.S. and
across the globe.

 

Operating profits for Berkshire fell 10% during the second quarter, dropping
to $5.51 billion from $6.14 billion in the year-earlier period. The company
also took a charge of approximately $10 billion from Precision Castparts,
Berkshire’s largest business within its manufacturing segment.

 

Berkshire’s investments in public markets gained $34.5 billion in the
quarter. That gain caused overall second-quarter net earnings to surge to
$26.3 billion, up from $14.1 billion a year ago. However, unrealized gains
from investments quarter to quarter are volatile and Buffett himself warns
investors not to focus on that overall net earnings figure.

 

The company is heavily invested in several companies that have rallied since
the broader stock market bottomed in late March. Apple — Berkshire’s biggest
common stock holding — has nearly doubled since March 23. JPMorgan Chase is
up more than 27% over that time period and Amazon has popped more than 66%.

 

To be sure, Berkshire warned of the uncertainty presented to its businesses
by the ongoing coronavirus pandemic, noting: “The risks and uncertainties
resulting from the pandemic that may affect our future earnings, cash flows
and financial condition include the nature and duration of the curtailment
or closure of our various facilities and the long-term effect on the demand
for our products and services.”

 

The company also said insurance giant Geico — which is owned by Berkshire —
will likely see its underwriting results “negatively affected” by the
pandemic for the rest of 2020 and into the first quarter of next year.
--cnbc

 

 

 

 

 

 


 


 


 

 


 

INVESTORS DIARY 2020

 


Company

Event

Venue

Date & Time

 


Zimbabwe

National Heroes Day

Zimbabwe

10  August 2020

 


Zimbabwe

Defence Forces’ Day

Zimbabwe

11  August 2020

 


Old Mutual Zimbabwe

AGM

virtual

12  August 2020 | 3pm

 


CBZ

AGM

Virtual

14  August 2020 | 6pm

 


Lafarge

AGM

Virtual

18 August 2020  | 12pm

 


Companies under Cautionary

 

 

 


 

 

 

 


Bindura Nickel Corporation

 

 

 


Padenga Holdings

 

 

 


Delta Corporation

 

 

 


Meikles Limited

 

 

 


 <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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