Bulls n Bears Daily Market Commentary : 13 February 2020

Fri Feb 14 02:23:35 CAT 2020

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Bulls n Bears Daily Market Commentary : 13 February 2020

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Zimbabwe Stock Exchange Update

Market Turnover ZWL$12,033,501.62 with foreign buys at ZWL$616,988.25 and
foreign sales were ZWL$1,250,924.01 Total trades were 142

The All Share index gained further by 45.55 to close at 434.02 points. OLD
MUTUAL LIMITED  rose by $1.3511 to $52.0011, DELTA   added $1.2011 to
$7.2200 and PPC was $1.000 firmer at $6.0000. MEIKLES  also increased by
$0.9600 to $5.7600 and CAFCA was $0.8275 stronger at $4.9725.

POWERSPEED   was the only counter trading in the negative losing $0.0678 to
$0.3552.

 <http://www.nicozdiamnond.co.zw/> 

  Global Currencies & Equity Markets

AFRICA-FX- Kenyan shilling to weaken, Uganda's to be stable

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

KENYA

The Kenyan shilling is seen under pressure in the coming week due to
increased dollar demand from merchandise importers and some multinational
companies, traders said.

Commercial banks quoted the shilling at 100.40/60 per dollar, compared with
100.35/55 at last Thursday’s close.

UGANDA

The Ugandan shilling was seen holding steady, with a central bank decision
to maintain its key rate expected to fuel favourable market sentiment.

Commercial banks quoted the shilling at 3,664/3,674, compared with last
Thursday’s close of 3,670/3,680.

On Thursday Bank of Uganda held its benchmark lending rate at 9%.

TANZANIA

The Tanzanian shilling is expected to gain slightly due to reduced dollar
demand from importers and an increase in inflows from non-governmental
organisations.

Commercial banks quoted the shilling at 2,306/2,316 per dollar, the same
level as last Thursday’s close.

South Africa

South African rand slides, stocks dip ahead of Ramaphosa speech

(Reuters) - South Africa’s rand was slightly weaker on Thursday ahead of
President Cyril Ramaphosa’s State of the Nation address, with investors
treading cautiously before hearing the government’s plans to grow a limping
economy.

At 1520 GMT the rand was 0.18% weaker at 14.8770 per dollar.

The currency had been dragged lower in the previous session after data
showed retail sales in December fell, but mining output figures on Thursday
showed a surprise 1.8% year-on-year gain, helping to lift the gloom around
the currency.

Ramaphosa’s fourth parliament-opening speech since he took office in 2018 is
being ranked as his most important, as economic growth flounders and
government mismanagement persists despite his campaign promises to tackle
both.

A Reuters poll on Thursday found inflation would remain well below the upper
end of the Reserve Bank’s 3-6% target range, maintaining the attractiveness
of the carry yield on the country’s assets compared to most emerging market
peers, even with lending rates expected to fall.

There was also a mixed market reaction to power firm Eskom’s announcement
that it would spend up to $27 million on severance packages in a bid to cut
its ballooning staff costs. Ramaphosa’s speech will be watched for further
details on reform of the state firm.

Bonds ended slightly weaker, with the yield on benchmark 2030 paper up 1.5
basis points at 8.895%. The Top-40 share index inched up 0.11% to 52,055,
while the broader all-share edged up 0.16% to 57,835.

The biggest blue chip loser was consumer goods firm Tiger Brands, down 4.8%
to 178.95 rand after it on Wednesday warned that headline earnings could
fall as much as 36%.

Gold and platinum miners were boosted by higher precious metals prices
globally as investors bought back into safe-haven assets as the number of
coronavirus infections rose, rekindling fears of the negative impact on
economic growth worldwide.

Impala Platinum and Sibanye Gold were both up more than 5%.

Shares in Harmony Gold were largely flat after jumping in the previous
session on confirmation the miner would buy the last of AngloGold Ashanti’s
remaining South African assets. 

Global Markets

Jump in coronavirus cases halts stock rally; dollar gains

(Reuters) - The dollar rose and global equity markets slumped on Thursday
after a new methodology that boosted the coronavirus death toll in China
unnerved investors, curbing a rally that had lifted U.S. and European stocks
to a series of record peaks.

Chinese officials said 242 people died in Hubei province on Wednesday, the
biggest daily rise since the virus emerged in the provincial capital of
Wuhan in December.

More than 14,000 new cases were reported in the province on Thursday, up
from 2,015 new cases nationwide a day earlier, due to a change to include
results from quicker computerised tomography (CT) scans that reveal lung
infections, rather than relying just on laboratory tests to confirm cases.

The jump in reported cases halted a rally that lifted Wall Street’s three
main gauges, indexes for pan-regional European shares, Germany’s DAX and
Canada’s S&P/TSX index.

Investors sought safety in U.S. assets, pushing the yield on the 10-year
U.S. Treasury note lower as the euro plunged to a more than two-year low
against the dollar. The euro fell to a four-and-a-half-year low against the
Swiss franc.

The United States is expected to weather the economic impact of the virus
better than the euro zone.

The chief economist of AXA Investment Managers, Gilles Moec, said the impact
of the virus could be part of a “perfect storm” for Europe that hurts the
economy for months before being compounded by a heated trade battle with the
United States.

The dollar index rose 0.05%, with the euro down 0.3% at $1.0838.

Europe’s main markets followed Asia into red, while stocks on Wall Street
traded slightly lower to little changed.

MSCI’s gauge of stocks across the globe shed 0.25% and its emerging markets
index lost 0.42%.

The pan-European STOXX 600 index lost 0.02%.

The FTSE 100 in London slid 1.1%, derailed by steep falls in heavyweights
Barclays and utility Centrica , along with the jolt to risk sentiment from
the rise in coronavirus cases in China.

On Wall Street, the Dow Jones Industrial Average fell 128.11 points, or
0.43%, to 29,423.31. The S&P 500 lost 5.51 points, or 0.16%, to 3,373.94 and
the Nasdaq Composite dropped 13.99 points, or 0.14%, to 9,711.97.

While the jump in reported coronavirus cases was unsettling, markets in Asia
took the news in stride.

MSCI’s broadest index of Asia-Pacific shares outside Japan snapped two days
of 1% gains to close 0.1% lower as most markets across the region posted
modest declines.

Oil prices rose, shrugging off bearish reports that cut demand forecasts for
this year on the back of the coronavirus outbreak. China is the world’s
biggest oil importer.

Paring losses from earlier in the session, Brent crude rose 55 cents to
settle at $56.34 a barrel, while U.S. West Texas Intermediate added 25 cents
to settle at $51.42 a barrel.

Benchmark 10-year notes last rose 4/32 in price to push its yield down to
1.6139%. The yield earlier touched 1.568%.

U.S. gold futures settled up 0.5% at $1,578.80 an ounce.

There was drama for Brexit-bound British markets.

The sudden resignation of the British finance minister Sajid Javid caused a
jump in both sterling and British government bond yields amid bets that his
replacement, the 39-year-old Rishi Sunak, will beef up spending.

Javid’s departure, coming less than a month before he was due to deliver his
first budget and after just 204 days on the job, made him the
shortest-serving chancellor of the exchequer since 1970.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold rises to over 1-week high as virus victims mount in China

Reuters) - Gold prices jumped to their highest in more than a week on
Thursday after a sharp increase in the number of new coronavirus cases in
China renewed fears over global economic impact and persuaded investors to
seek lower-risk assets.

China reported a record rise in deaths and thousands more infections using a
broader definition on Thursday, while Japan became the third location
outside mainland China to experience a fatality.

Spot gold rose 0.7% to 1,576.32 per ounce by 1844 GMT, after touching its
highest since Feb. 4, earlier in the session, at $1,577.81 .

U.S. gold futures settled 0.5% up at $1,578.80.

Global share markets retreated from record highs as the spike in new
coronavirus cases in China weighed on the sentiment.

Gold is often used as a safe store of value during times of political and
financial uncertainty.

Federal Reserve Chair Jerome Powell reiterated his confidence in the U.S.
economic outlook, despite some drag “soon” from the coronavirus situation.

On Wednesday, China reported its lowest number of new virus cases since late
January, lending weight to a prediction from its senior medical adviser that
the outbreak might be over by April.

Palladium rose 1.2% to $2,434.56 per ounce, having hit a one-week high
earlier in the session.

Rising demand from automakers pushed the palladium market to its biggest
deficit for five years in 2019 and the deficit is expected to grow this year
too, materials maker Johnson Matthey said.

Silver rose 1.1% to $17.65 per ounce, while platinum gained 0.9% to $969.37.

Copper rises as traders look past rising coronavirus deaths

(Reuters) - Copper and other industrial metals prices rose on Thursday as
traders shrugged off figures showing thousands more coronovirus cases and
attention moved to the potential for China’s efforts to stop the spread of
the virus to disrupt supply.

The outbreak has depressed economic activity in China, the world’s largest
industrial centre, driving down metals prices.

Using a new method of diagnosis, China’s Hubei province said 14,840 cases
were reported on Thursday and 242 people had died on Wednesday, taking total
deaths in China from the virus to 1,367.

But excluding cases confirmed using the new methods, the number of new cases
rose by only 1,508.

The number of new cases had appeared to be falling and the country’s senior
medical adviser said on Monday the epidemic could end by April.

Benchmark copper on the London Metal Exchange (LME) ended 0.5% higher at
$5,790 a tonne. Prices are down nearly 10% from four weeks ago, but have
recovered somewhat from a low of $5,523 on Feb. 3.

The higher Hubei numbers reflected a change in how the figures are counted
rather than an acceleration of the virus’s spread, said Capital Economics
analyst Kieran Clancy.

Clancy also said focus was now moving from the effect of coronavirus on
metals demand to the risk that measures to control its spread would disrupt
production - something that could support prices.

China is the world’s biggest metals producer and consumer.

MARKETS: Global equities fell and China’s yuan weakened.

CHINA CARS: China’s vehicle sales likely fell by almost a fifth in January,
an industry group said.

LOGISTICS: China’s steel industry body has asked the government for help in
overcoming transport disruptions caused by efforts to stop the spread of
coronavirus.

MINERS: Rio Tinto , which runs the Oyu Tolgoi copper-gold mine in Mongolia,
said its copper concentrate shipments to China had slowed.

Griffin Mining said it was returning essential staff to its Caijiaying mine
in China to resume operations.

ZINC: Henan Yuguang Gold and Lead, one of China’s biggest lead and zinc
producers, said it had closed half of its 300,000 tonnes per year zinc
smelting capacity.

U.S. ECONOMY: Federal Reserve Chair Jerome Powell on Wednesday reiterated
his confidence in the U.S. economic outlook.

COPPER TECHNICALS: Support was at $5,707, the uptrend line from copper’s
Feb. 3 low, brokerage Marex Spectron said.

OTHER METALS: LME aluminium finished up 0.6% at $1,747.50 a tonne, zinc
added 1.3% to $2,175, nickel rose 1.5% to $13,290, lead gained 2.1% to
$1,892 and tin ended up 0.6% at $16,590. 

INVESTORS DIARY 2020

Company

Event

Venue

Date & Time

 <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
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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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