Bulls n Bears Daily Market Commentary : 15 January 2020

Thu Jan 16 09:23:48 CAT 2020

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Bulls n Bears Daily Market Commentary : 15 January 2020

Zimbabwe Stock Exchange Update

Market Turnover ZWL$9,300,557.90 with foreign buys at ZWL$135,000.00 and
foreign sales were ZWL$5,381,384.90 Total trades were 175

The All Share index added another 0.11 points  to close at 236.72 points.
MEIKLES rose by $0.0500 to $2.7000, DAIRIBORD gained $0.0330 to settle at
$0.4605 and NAMPAK  was $0.0200 stronger at $0.7400. INNSCOR also increased
by $0.0150 to $3.6000 and OK ZIMBABWE traded $0.0118 higher to end at
$0.7005.

Trading in the negative; OLD MUTUAL LIMITED retreated by $0.2998 to
$36.4856, AFDIS lost $0.1900 to $3.0000 and PADENGA  was $0.0088 lower at
$2.4512. ECONET   also decreased by $0.0085 to $1.5403 and WILLDALE  traded
$0.0052 weaker at $0.0315.

  Global Currencies & Equity Markets

Kenya

Kenyan shilling trading in tight range against the dollar

(Reuters) - The Kenyan shilling was stable on Wednesday and was forecast to
trade in a tight range against the dollar supported by inflows from
non-governmental organizations and offshore investors buying government
debt, traders said. 

At 0834 GMT, commercial banks quoted the shilling at 101.30/50 per dollar,
the same as Tuesday's close.

Uganda

Ugandan shilling weakens on importer demand

(Reuters) - The Ugandan shilling weakened on Wednesday on the back of demand
from energy and other goods importers, traders said.

At 1112GMT commercial banks quoted the shilling at 3,685/3,695, weaker than
Tuesday’s close of 3,665/3,675. 

 <mailto:info at bulls.co.zw> 

GLOBAL MARKETS

World stocks pause at record peak as markets assess U.S.-China deal

(Reuters) - World stocks inched ahead to a record high on Thursday after the
United States and China signed an initial deal to defuse their 18-month
trade war, though financial markets were wary as a number of thorny issues
remained unresolved.

MSCI’s broadest index of world stocks firmed 0.03% in Asia after closing at
record level on Wednesday while its index on Asia-Pacific shares outside
Japan rose 0.13%, with India and Australia hitting record highs.

Japan’s Nikkei rose 0.14% while mainland China’s Shanghai composite index
was almost flat. Pan-European Euro Stoxx 50 futures were up 0.03% and German
DAX futures ticked up 0.1% in early trade.

U.S. President Donald Trump and Chinese Vice Premier Liu He on Wednesday
signed a deal that will roll back some tariffs and see China boost purchases
of U.S. goods and services by $200 billion over two years.

The Phase 1 deal however does not fully eliminate the tariffs while the $200
billion purchase targets, which include energy, farm and manufacturing
products, look daunting to achieve.

Nor does it address structural economic issues that led to the trade
conflict. Officials say these will be dealt in Phase 2 negotiations, though
the differences there are so fundamental that many investors doubt whether
any deal will come through.

On the Wall Street, the S&P 500 closed at a record high of 3,289.3 points,
up 0.19%, with gains fairly small after the market has rallied for months on
hopes of a deal.

The index was dragged down by fall in financial shares following lacklustre
earnings from Bank of America and Goldman Sachs.

U.S. shares are traded above 18 times expected earnings, near their
post-2008 financial crisis peak marked at the start of 2018.

DISINFLATION EVERYWHERE

Bond yields dropped as a boost from the trade deal failed to offset pressure
from low U.S. producer price inflation data, which highlighted persistently
low inflationary pressure.

The price index rose less than expected in December to cap 2019 with rise of
1.3%, lowest since 2015.

The 10-year U.S. Treasuries yield slipped to one-week low of 1.780% compared
with a high of 1.900% last Thursday and last stood at 1.793%.

Weak inflation was evident also in UK where consumer price inflation slowed
to 1.3%, its slowest rate in three years.

The data fanned bets the Bank of England will cut interest rates at the end
of this month, pushing the 10-year gilts yield to 2 1/2-month low of 0.630%.

The British pound last traded at $1.3047, having managed to recover a tad
from its three-week low touched earlier this week.

The Swiss franc held firm, having rising to its strongest against the dollar
in over a year and its highest against the euro in almost three years after
the United States added Switzerland to its watchlist of currency
manipulators.

Washington’s decision led traders to think it will become difficult for the
Swiss National Bank to intervene to weaken the franc in the future.

The Swiss currency last stood at 0.9644 franc per dollar , near Wednesday’s
high of 0.9631.

In contrast, the Chinese yuan hovered just below its 5-1/2-month high
touched earlier this week after Washington dropped its currency manipulator
label on China.

Coupled with the trade deal, warmer ties between the two countries are seen
as positive for the Chinese economy and its currency.

The offshore yuan stood at 6.8872 to the dollar, near Tuesday’s high of
6.8662.

Other currencies have mostly muted reaction to the trade deal.

Against the yen the dollar traded at 109.93 yen, below its near eight-month
peak of 110.22 set on Tuesday.

The euro stood at $1.1151, extending its recovery from a low of $1.10855 hit
last Friday.

Oil prices edged back after touching a six-week trough the previous day on
data showing big increases in U.S. refined products and hopes for more
Chinese purchases of U.S. oil and gas.

Brent crude futures rose 0.7% to $64.45 a barrel while U.S. West Texas
Intermediate (WTI) crude gained 0.73% to $58.23 per barrel.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Mali's gold production rises 7% in 2019 to record high

(Reuters) - Mali’s industrial gold production rose 7% in 2019 to a record
65.1 tonnes, mines ministry statistics showed on Wednesday.

The increase was partly due to the launch of production at a mine owned by
Australia’s Resolute Mining, ministry official Mamadou Sidibe said.

The West African country’s total gold output last year was probably around
71.1 tonnes due to the additional 6 tonnes of gold that artisanal miners are
estimated to produce each year, Sidibe said.

Industrial production is expected to increase further in 2020, he said,
without giving further details.

Stocks climb new peaks on trade deal, oil slips on demand worries

(Reuters) - Key world equity indexes climbed to new records on Wednesday on
hopes a U.S.-China trade deal will reduce harmful tensions, but oil prices
slid on doubts the pact will spur world growth and boost crude demand.

U.S. President Donald Trump and Chinese Vice Premier Liu He signed a Phase 1
deal that will roll back some tariffs and see China boost purchases of U.S.
goods and services, defusing a prolonged conflict between the world’s two
largest economies.

Liu said in remarks at the White House that the United States and China need
to step up cooperation, and that the deal benefits both countries and the
world. The deal capped an 18-month dispute that had roiled markets.

The centerpiece of the deal is a pledge by China to purchase at least an
additional $200 billion worth of U.S. farm products and other goods and
services over two years, over a baseline of $186 billion in purchases in
2017.

MSCI’s all-world stock index and the three major indexes on Wall Street set
record intraday highs. The MSCI benchmark, along with the Dow and S&P 500,
also posted record closing highs, while the Dow closed above the 29,000 mark
for the first time.

The deal is unlikely to significantly change the growth outlook, but it
should allow companies to make the capital investments they have not, which
is positive, said Marvin Loh, senior global macro strategist at State Street
Global Markets.

MSCI’s gauge of stocks across the globe gained 0.07%. Earlier in Europe, the
pan-regional STOXX 600 index closed up 0.1% while MSCI’s broadest measure of
Asia-Pacific markets outside Japan closed down 0.35%. Japan’s Nikkei lost
0.45%.

On Wall Street, the Dow Jones Industrial Average rose 90.55 points, or
0.31%, to 29,030.22. The S&P 500 gained 6.14 points, or 0.19%, to 3,289.29
and the Nasdaq Composite added 7.37 points, or 0.08%, to 9,258.70.

Emerging market stocks lost 0.53%.

Oil prices slipped on concerns the trade agreement may not provide much of a
demand boost because the United States intends to keep tariffs on Chinese
goods until a Phase 2 deal is reached.

Prices were also under pressure from a report by the Organization of
Petroleum Exporting Countries. OPEC expects lower demand for its oil in 2020
even as global demand rises, as rival producers grab market share and the
United States looks set for another output record.

Brent crude fell 49 cents to settle at $64.00 a barrel. U.S. West Texas
Intermediate crude futures settled down 42 cents at $57.81 a barrel.

The dollar pared losses but remained lower against the euro and the yen
after the signing of a trade deal that may prove a mild negative for the
greenback as it removes uncertainty.

The dollar index, tracking the unit against six major peers, fell 0.14%,
with the euro up 0.18% to $1.1147.

U.S. Treasury yields declined as investors repositioned around new data
showing producer prices barely rose in December.

A rise in the cost of goods was offset by weakness in services, the latest
indication of tame inflation pressures that could allow the Federal Reserve
to stand pat on interest rates this year.

Benchmark 10-year notes last rose 9/32 in price to push its yield lower to
1.7864%.

In Europe, investors flocked to new fund raisings by Italy and Belgium a day
after Spain saw record demand.

The 10-year German bond yield fell 3 basis points to -0.201%, not too far
from the more than six-month highs of -0.157% touched at the start of
January.

U.S. gold futures settled up 0.6% at $1,554 an ounce.

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
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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
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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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