Bulls n Bears Daily Market Commentary : 26 February 2020

Thu Feb 27 11:01:02 CAT 2020

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Bulls n Bears Daily Market Commentary : 26 February 2020

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Zimbabwe Stock Exchange Update

Market Turnover ZWL$27,484,835.50 with foreign buys at ZWL$428,018.00 and
foreign sales were ZWL$428,018.00 Total trades were 242

The All Share index retreated by 4.86 points  to close at 478.72 points. BAT
eased $1.5000 to $66.0000, DELTA CORPORATION dropped $0.2763 to $7.1270 and
PADENGA

was $0.1915 weaker at $6.0102. OK ZIMBABWE also decreased by $0.0984 to
$1.9321 and CASSAVA SMARTECH traded $0.0739 lower at $2.8977.

Gains were recorded in OLD MUTUAL LIMITED  which added further by $3.8287 to
$47.4504, FIRST MUTUAL LIMITED rose by $0.1245 to $1.0200 and NATFOODS was
$0.0500 firmer at $19.2000. INNSCOR also gained $0.0481 to end at $7.0491
and AXIA  traded $0.0262 stronger at $1.8301.

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  Global Currencies & Equity Markets

South Africa

South African rand firms after Mboweni's proposal to cut public sector wages

(Reuters) - The South African rand strengthened early on Thursday, a day
after Finance Minister Tito Mboweni proposed cuts to the public sector wage
bill.

Financial markets cheered the proposal as rising public sector wages have
long been a threat to the country’s stretched public finances.

But some analysts are sceptical that the minister will be able to achieve
the more than 160 billion rand ($10.5 billion) of wage cuts targeted over
three years, given entrenched opposition from labour unions.

At 0650 GMT, the rand traded at 15.2550 versus the dollar, around 0.4%
stronger than its previous close.

The only major domestic data release expected on Thursday is the producer
price index, around 0930 GMT. Mboweni is also expected to brief lawmakers on
his budget plans.

Government bonds were firmer in early deals, with the yield on the 2026 bond
down 4 basis points to 7.700%.

Uganda

Ugandan shilling weakens as demand from energy and banks weighs

(Reuters) - The Ugandan shilling weakened for a second straight day on
Wednesday on the back of elevated demand for hard currency from both players
in the interbank and importers of fuel and other merchandise.

At 1023 GMT commercial banks quoted the shilling at 3,685/3,695, compared to
Tuesday’s close of 3,675/3,685.

GLOBAL MARKETS

Stocks, oil fall further on accelerating coronavirus concerns

(Reuters) - Stocks and oil prices tumbled again on Tuesday and the benchmark
U.S. debt yield hit a record low on growing concern about the effects of the
spread of coronavirus on the global economy.

The market sell-off followed the largest losses in stocks in over two years
on Monday and accelerated after the U.S. Centers for Disease Control and
Prevention said Americans should begin to prepare for community spread of
the disease.

The Japanese yen strengthened against the dollar for a third session
running, in a sign that traders are in search of relatively safer assets.

The flu-like virus has now infected more than 80,000 people, 10 times more
cases than the SARS epidemic in 2003. Several European countries were
dealing with their first infections, feeding worries about a pandemic.

The World Health Organization, however, has said the epidemic in China,
where it began in December, peaked between Jan. 23 and Feb. 2 and has been
declining since.

On Wall Street, where stocks fell the most in two years on Monday, the S&P
500 posted its largest back-to-back drop since August 2015.

The Dow Jones Industrial Average fell 879.44 points, or 3.15%, to 27,081.36;
the S&P 500 lost 97.68 points, or 3.03%, to 3,128.21; and the Nasdaq
Composite dropped 255.67 points, or 2.77%, to 8,965.61.

The pan-European STOXX 600 index lost 1.76% and MSCI’s gauge of stocks
across the globe shed 2.31%.

MSCI’s broadest index of Asia-Pacific shares outside Japan closed 0.14%
higher, while Japan’s Nikkei futures lost 0.34%.

BET ON RATE CUTS

The risks are such that bond markets are betting that central banks will
have to ride to the rescue with new stimulus.

Futures for the Federal Reserve funds rate have surged in the last few days
to price in a 50-50 chance of a quarter-point interest rate cut as early as
April. In all, they imply more than 50 basis points of reductions by year
end.

The indication of falling U.S. rates hit the dollar against a basket of its
peers.

The dollar index fell 0.361%, with the euro up 0.27% at $1.0881.

The yen strengthened 0.54% versus the greenback to 110.15 per dollar.
Sterling was last trading at $1.3002, up 0.58% on the day.

The rush to bonds dragged yields on 10-year U.S. Treasury notes to a record
low of 1.307%. The U.S. benchmark last rose 11/32 in price to yield 1.3421%,
down from 1.377% late on Monday.

The 30-year bond set a fresh record low at 1.786 and last rose 17/32 in
price to yield 1.8135%.

For the first time, the 10-year yield on Municipal Market Data’s benchmark
scale for top-rated, tax-exempt municipal bonds fell under 1% to .98%.

Gold ran into profit-taking after hitting a seven-year peak overnight, and
last dropped 1.6% to $1,634.59 an ounce.

Oil prices continued to fall as demand concerns linked to the virus’ spread
outweighed supply cuts.

U.S. crude fell 3.11% to $49.83 per barrel and Brent was last at $54.76,
down 2.74% on the day.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold retreats from multi-year peak, but virus fears remain

(Reuters) - Gold fell over 1% on Tuesday as the metal’s rally to 7-year
highs in the last session prompted profit-taking even as worries about the
coronavirus kept investors anxious about the fate of global economy.

Spot gold slipped about 1% to $1,644.40 per ounce by 01:56 p.m. EST (1856
GMT). U.S. gold futures settled down 1.6% at $1,650.

On Monday, the metal surged as much as 2.8% to $1,688.66, its highest since
January 2013.

Mainland China had 508 new confirmed cases, up from 409 on Feb. 23, bringing
the total confirmed cases to 77,658.

The rapid spread of the virus beyond China has heightened fears over its
impact on the global economy, driving some bets that the U.S. Federal
Reserve will be pressed to cut interest rates to cushion the hit.

Countries around the world are stepping up efforts to stop a pandemic of the
virus that emerged in China and is spreading in Europe and the Middle East.

Gold in euros and gold priced in sterling slid from all-time peaks hit on
Monday.

Among other precious metals, palladium jumped 3% to $2,707 per ounce.

Silver fell 2.3% to $18.20 an ounce, having touched its highest since early
September on Monday. Platinum slid 3.3% to $931.7.

U.S. trade panel rejects import duties on fabricated structural steel

(Reuters) - The U.S. International Trade Commission on Tuesday threw out the
U.S. anti-dumping and anti-subsidy duties on fabricated structural steel
from Canada and Mexico, ruling that such imports do not harm U.S. producers.

The decision by the panel in a split, 3-2 vote is a rare rejection of U.S.
duties imposed by the U.S. Commerce Department in an anti-dumping and
anti-subsidy case. Under U.S. trade law, the commission does not rule on
whether products were dumped below cost or unfairly subsidized, but only on
whether U.S. producers suffered an injury.

The ruling eliminates U.S. anti-dumping and anti-subsidy duties on imports
of steel structures prefabricated from beams, girders, columns, plates, and
flanges for use in construction. U.S. imports of such fabricated steel
products in 2018 were valued at $722.5 million from Canada, $897.5 million
from China and $622.4 million from Mexico, the Commerce Department said.

For imports from China, Commerce in January had imposed final anti-dumping
duty rates of up to 154.1% and anti-subsidy duties of up to 206.5%. Imports
from Mexico were subjected to anti-dumping rates of up to 30.6% and
anti-subsidy duties of 68.9%. On Canadian structural steel fabrications,
Commerce had imposed anti-dumping duties of up to 6.7% and no anti-subsidy
duties.

INVESTORS DIARY 2020

Company

Event

Venue

Date & Time

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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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