Major International Business Headlines Brief::: 24 January 2020

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Major International Business Headlines Brief::: 24 January 2020

 


 

 


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

 


 

 


 

 

ü  Gold prices inch lower as markets eye ECB decision

ü  NZD/USD remains stuck in tight range below 0.6600 ahead of NZ inflation
data

ü  Focus on ECB and Norges Bank meetings – Danske Bank 0

ü  Stanley launches cash accounts for wealth management clients

ü  Swiss hospital drones to take off again

ü  GBP/USD: All eyes on the BoE as bulls start to stall 0

ü  Greta Thunberg: US treasury chief attacks activist

ü  Tesla overtakes Volkswagen as value hits $100bn

ü  Coronavirus: Taobao warns firms not to profit from outbreak

ü  Chancellor tries to reassure firms on post-Brexit trade

ü  Zambia's economy to grow by 3% in 2020 - President

ü  Trafigura to buy Angolan general's stake in Puma Energy -sources

ü  South Africa's African Rainbow Capital to raise stake in Alexander Forbes

ü  Promotions drive 20-week sales rise for South Africa's Clicks drug chain

ü  ERG suspends Zambia refinery on shortage of cobalt, copper concentrates

ü  Kenyan shilling firmer on flows from flower exports, offshore investors

 

 

 

 

 

 


 <mailto:info at bulls.co.zw> 

 


 

Gold prices inch lower as markets eye ECB decision

(Reuters) - Gold prices edged lower on Thursday, consolidating near the
$1,550 level, ahead of a policy decision by the European Central Bank,
although mounting concerns over a virus outbreak in China limited losses.

 

The euro zone’s central bank will announce its monetary policy decision at
1245 GMT.

 

Spot gold was down 0.2% at $1,556.20 per ounce by 0855 GMT. U.S. gold
futures fell 0.1% to $1,555.90.

 

With nearly 600 confirmed cases and 17 deaths in China from the new
coronavirus, the World Health Organization will decide on Thursday whether
to declare a global emergency over the outbreak.

 

However, “If there is an (WHO emergency) announcement, the markets might
conclude or be concerned that we might have a SARS-like response, where
there is significant economic impact and gold might go up on that,” he said.

 

The Severe Acute Respiratory Syndrome (SARS) epidemic in 2002-2003, also a
coronavirus outbreak, had started in China and killed nearly 800 people
worldwide and hit the global economy.

 

Gold is considered a safe asset in times of political and economic
uncertainty.

 

Traders remained anxious about the spread of the virus as China gears up to
celebrate the Lunar New Year from this weekend, a peak period for travel and
gold demand in the region.

 

Under investors’ radar is a monetary policy meeting by the European Central
Bank, where ECB President Christine Lagarde is also set to launch a broad
review of its policy that is likely to see her redefine the central bank’s
main goal and how to achieve it.

 

Lower interest rates reduce the opportunity cost of holding non-yielding
bullion.

 

Spot gold is biased to revisit its Jan. 21 low of $1,545.96 per ounce, as it
looks shaky around a resistance at $1,564, said Reuters technical analyst
Wang Tao.

 

Among other precious metals, palladium rose 1.1% to $2,499.70 an ounce,
silver fell 0.5% to $17.72 per ounce, while platinum dipped 0.4% to
$1,007.79. 

 

 

NZD/USD remains stuck in tight range below 0.6600 ahead of NZ inflation data

The NZD/USD pair is struggling to find direction on Thursday and trading in
a very tight 15-pip range below the 0.6600 handle with investors staying on
the sidelines ahead of the key inflation data from New Zealand. As of
writing, the pair was up 0.05% on the day at 0.6594.

 

The lack of significant macroeconomic data releases from China and New
Zealand caused the pair to stay stuck in its narrow channel. Although the
positively-correlated AUD/USD pair gained nearly 40 pips during the Asian
trading hours following the upbeat labour market data from Australia, the
NZD/USD failed to react.

 

On the other hand, the greenback's uninspiring performance since the start
of the week allows the pair to extend its sideways action. The US Dollar
Index, which tracks the USD's value against a basket of six major
currencies, seems to have gone into a consolidation phase after meeting
resistance near 97.70 on Monday.

 

Will CPI data bring volatility?

Later in the day, the weekly Initial Jobless Claims and Kansas City Fed's
Manufacturing Index from the US will be looked upon for fresh impetus. More
importantly, Statistics New Zealand will publish its quarterly inflation
report at 21:45 GMT. 

 

Markets expect the Consumer Price Index (CPI) to rise to 1.8% on a yearly
basis in the fourth quarter from 1.5% and a lower-than-expected reading
could weigh on the NZD as it would allow the Reserve Bank of New Zealand to
continue to cut rates without worrying about inflation.

 

 


 <mailto:info at bulls.co.zw> 

 


 

Focus on ECB and Norges Bank meetings – Danske Bank 

Analysts at Danske Bank offered a brief overview of Thursday’s important
market-moving events – the highly anticipated European Central Bank (ECB)
meeting and Norges Bank rate decision.

 

Key quotes:

“Today’s highlight will be the ECB meeting which is set to focus on the
strategic review and not on new policy messages, see ECB Preview – Time to
reveal the scope, 17 January and our ECB strategic review “What, why, how?
10 critical questions for the strategic review. Media reported that ECB
governing council members received documents concerning the strategic
review, which will officially be launched today. Bloomberg reported
yesterday that ECB will split the discussions in two parts (one on inflation
and one on climate, communication etc). On the economic side we expect the
ECB to confirm its easing bias and acknowledge its downside risk assessment,
but also note the fading downside risks.”

 

“In Norway, we expect Norges Bank to leave its policy rate at 1.5% and
reiterate that it will remain unchanged “in the coming period” at its
rate-setting meeting on Thursday. This is one of the bank’s “interim”
meetings, with no new monetary policy report or press conference, and
historically the threshold for any new signals at such meetings has been
relatively high.”forexcrunch

 

 

Stanley launches cash accounts for wealth management clients

Morgan Stanley Wealth Management clients now have a new way to manage their
cash, with the launch of the asset manager's CashPlus account. 

 

The new account aims to compete as an alternative to traditional banking. It
is directed at the firm's existing wealth management clients, who can open
an account with their advisor or online.

 

The new accounts help clients with their cash management needs, according to
a Morgan Stanley executive, and also enable financial advisors to give more
comprehensive advice based on their clients' financial situation.

 

The CashPlus accounts come in two varieties: Premier CashPlus and Platinum
CashPlus.

 

To avoid a monthly fee, Premier CashPlus requires either $2,500 in total
monthly deposits or $25,000 in average daily balances.

 

Platinum CashPlus requires both $5,000 in total monthly deposits and $25,000
in average daily balances.

 

Both accounts waive the total monthly deposit thresholds in exchange for
Social Security deposits of any amount. That's a nod to the firm's existing
clients who rely on Social Security for their sole source of income and also
have their other assets invested with the firm, Morgan Stanley said.

 

Both accounts offer clients benefits aimed at distinguishing them from
traditional banking offerings.

 

That includes unlimited ATM fee rebates, unlimited check writing, and no
foreign transaction fees or cash advance fees. Additionally, clients will be
able to access cash from banks or tellers that accept MasterCard.

 

With the Morgan Stanley Debit Card, clients also get certain perks,
including extended warranty and price protection. Account holders also have
access to Morgan Stanley Cards from American Express.

 

Both CashPlus accounts include access to credit and identity protection
monitoring service through Experian. Other protections that come with the
accounts include SIPC and FDIC protection, which insures deposits up to
certain limits.

 

Account holders will be able to monitor their accounts online, where they
can lock and unlock debit cards, set alerts for account activity pay bills
online, authorize wire transfers, use mobile check deposit or transfer money
through digital payments network Zelle.

 

Morgan Stanley's CashPlus accountsbegan earlier this month. The accounts
replace the firm's Premier Cash Management program.--cnbc.com

 

 

 

Swiss hospital drones to take off again

Drones grounded following a crash near a child's play area have been given
the go-ahead to take off again.

 

The incident, in May, was the second in a year and prompted an independent
safety investigation.

 

Swiss Post and start-up dronemaker Matternet had been working together to
carry lab samples between hospitals.

 

The first incident, in January last year, saw a drone make an emergency
landing on Lake Zurich, following a GPS hardware error.

 

In the second, more serious, incident, the drone's parachute failed to
deploy and it crashed yards away from an area where young children were
playing. There were no injuries.

 

At the time, Swiss Post asked Matternet to make several changes:

 

reinforce parachute ropes with metal braiding

have two ropes instead of one

make a whistle alerting people to its presence louder

All of these had been implemented, the company told BBC News.

 

"We certify that Swiss Post and Matternet maintain high safety standards and
a high level of safety awareness. There are no reasons why flight operations
should not be resumed," said Prof Michel Guillaume, head of the Centre for
Aviation, at the Zurich University of Applied Sciences (ZHAW) and a member
of the expert board.

 

In response, Matternet said: "We're excited to resume and expand our
operations in Switzerland in close partnership with Swiss Post and the Swiss
Federal Office of Civil Aviation. Switzerland is known for its high
standards of safety and high quality transportation services."--BBC

 

 

 

GBP/USD: All eyes on the BoE as bulls start to stall 

GBP/USD is struggling in its correction and rally through the trendline
resistance, meeting supply at the mid-point of the 1.31 handle with a
bearish bias entering the charts. At the time of writing, GBP/USD is trading
at 1.3109 having travelled from a high of 1.3151 to a low of 1.3096.

 

The markets are getting set for the Bank of England on 30th January.
However, while market expectations for a January cut have rapidly increased,
but it is not yet a done deal. Let’s get into the arguments and fore and
against a rate cut as soon as January. Spoiler alert – Bank of England could
well be on hold considering a number reasons, including a PMI rebound on
Friday. 

 

BoE to hold

First and foremost, this will be the BoE Governor, Mark Carney’s, last
before Andrew Bailey, (Prime Minister Boris Johnson favourite over
Brexit-dubious Minouche Shafik) comes in to take the helm at the Old Lady
mid-March. Even though Bailey was deputy governor at the BOE for three years
to 2016, he didn’t sit on the rate-setting Monetary Policy Committee, so his
monetary stance is more or less unknown. However, it would be very unusual
for an outgoing governor, in their last meeting, to make such a move,
especially due to the politics surrounding Brexit. After all, there are nine
MPC members who will be unclear as to what future direction the incoming new
governor will wish to steer.

 

This Friday, we will have PMI data and Monetary Policy Members, Tenreyro and
Vlieghe, who joined the choir of members signing a dovish tune of late and
who have been very specific about these forthcoming reports. Should the
surveys rebound, it has been made clear, with a great deal of emphasis on
the data, that the Bank of England could well hold-off. A rate cut following
a rebound in the Composite reading would be peculiar. 

 

Also, Brexit is scheduled for the following day – surely the BoE would want
to see the impact that this has on the UK economy before making a move? The
BoE has made clear time and time again that they will not be motivated by
politics and a move around the date could be seen as stimulated by Brexit
politics, a message the BoE does not want to send to markets – (Casting
minds back, he BoE also held off in July post the referendum, despite
markets pricing in a rate cut 100%).

 

Reasons for BoE to cut

On the other hand, analysts at Nordea, who see the BoE holding, offer some
arguments on a list for cutting that has become longer recently as follows:

 

“Not only have there been dovish MPC signals, but inflation has also
softened somewhat as we prewarned back in September. Moreover, it appears
the BoE in contrast to 2018, when inflation also undershot target, is not
worried about a weaker sterling. And while wages are still holding up
nicely, there are some signs that wages could soon lose steam (see chart,
note BoE used to be wage hawks, especially Chief Economist Haldane).

 

With less easing ammo left, it could be wise to move swiftly and
aggressively (at least according to Saunders). The cost of waiting could
thus be high and as Carney said in his January speech, the BoE only have
around 250 bps left in its arsenal, when combining rate cuts, forward
guidance and QE.”

 

Overall, even if the BoE does cut rates as soon as the 30th, that doesn’t
mean we will now be in a new easing cycle from the BoE and therefore, any
downside in cable could be shortlived. But then again, it will very much
depend on how the Brexit trade negotiations go between the EU and UK. 

 

GBP/USD levels--forexcrunch

 

 

 

Greta Thunberg: US treasury chief attacks activist

Greta Thunberg should go away and study economics before lecturing
investors, the US treasury secretary has said.

 

Steven Mnuchin said the activist's call for investors to divest fossil fuels
showed a lack of understanding about the economy and jobs.

 

"After she goes and studies economics in college, she can come back and
explain that to us," he said at the World Economic Forum in Davos.

 

On Tuesday, President Donald Trump dismissed the "prophets of doom".

 

Mr Trump said that campaigners were too pessimistic and should concentrate
their fire on countries where emissions are rising. He did not say which
countries.

 

Mr Mnuchin continued the criticism on Thursday. In response to a question
about Ms Thunberg's call for fossil fuels to be scrapped, Mr Mnuchin said:
"Is she the chief economist?"

 

He added: "For people who call for divestment, there are significant
economic issues - issues with jobs."

 

The treasury secretary also raised hopes about a US-UK trade deal being
signed this year. He said a deal was "an absolute priority" for the
president. "We expect to complete that with them [UK] this year," he added.

 

'Aggressive' timetable

On the subject of the UK's post-Brexit trade negotiations with the US and
the EU, Mr Mnuchin said: "What I saw coming out was that they wanted to
accomplish both these deals in 2020. That's obviously an aggressive
timetable."

 

He said he could not comment on the EU talks, but he could comment on a
UK-US deal.

 

"That's an absolute priority of President Trump and we expect to complete
that with them this year, which we think will be great for them and great
for us," he added.

 

This statement on an accelerated timetable comes on the day when a key
Cabinet committee is due to set the strategy for trade negotiations. One of
the key debates is whether the UK should launch negotiations with the EU and
the US in parallel. Yesterday here in Davos, the Chancellor said that the EU
deal would be the first priority.

 

It seems an extraordinary suggestion that this could be done within a year,
when just yesterday the chancellor said that the UK Digital Sales Tax would
go ahead and the same member of the Trump team said countries that did this
arbitrarily would face retaliatory trade tariffs on their car exports. The
Trump team here also mentioned further Cabinet level discussions on the UK
deployment of Chinese Huawei technology in its 5G mobile network.

 

Commerce Secretary Wilbur Ross explained that there "should be far fewer
issues" between the UK and the US than there are between either of us and
the EU". The economies are similar, he said, and there's already a high
degree of coordination in the financial services sector, so it is "much
easier mechanically".

 

When I asked the Trump team if, as was the case a year ago, raising the
prices paid to US drugs companies and detaching the UK from EU food
standards on pathogens (eg chicken) were still aims, Mr Ross said: "What we
think is that drugs should have similar prices wherever they are, but I
don't believe we are in any position to tell the UK what to pay."

 

Elsewhere, the US team were confidently asserting the success of the
president's strategy of threatening trade tariffs to force negotiations, and
"we are now turning our attention to Europe".

 

The lesson from elsewhere is that achieving a "deal" as defined by President
Trump is always possible, particularly if leaving tariffs at a level five or
more times where they were in 2018 can be defined as so. It is difficult to
see how so many thorny, politically contentious issues across so much of the
UK's trade can be settled so quickly. The will to do something is there,
though.

 

Commerce Secretary Wilbur Ross, speaking at the same event, said he thought
a UK-US trade deal ought to be "much easier mechanically" than a UK deal
with the EU.

 

Concerns have been raised in the UK that the NHS could have to pay billions
of pounds more for drugs under such a trade deal, as the US will be seeking
"full market access" for its companies' products in the UK.

 

Mr Ross said: "What we think is that drugs should have similar prices
wherever they are, but I don't believe we are in any position to tell the UK
what to pay for drugs."

 

On Wednesday, Mr Mnuchin threatened new tariffs on UK carmakers after
Chancellor Sajid Javid defied pressure to cancel a new tax on tech firms.

 

But Mr Javid said the UK would not back down over the tax, which will hit US
firms such as Apple, Amazon and Facebook.--bbc

 

 

 

Tesla overtakes Volkswagen as value hits $100bn

Tesla has displaced Volkswagen as the world's second most valuable carmaker,
after a dramatic rise in share price pushed its market value to more than
$100bn (£76.1bn).

 

The milestone sets the stage for chief Elon Musk to collect billions in pay
tied to hitting that target.

 

Tesla's share price has more than doubled since October, when the firm
reported a rare quarterly profit.

 

Shares rose 4% on Wednesday, making its valuation second only to Toyota.

 

Although Mr Musk's company has some way to go to catch up with the Japanese
car making giant. Toyota has a stock market valuation of more than $230bn.

 

Some analysts say the rise in price reflects Tesla's performance in recent
months, during which it has opened a factory in Shanghai and met its
production goals.

 

This month, Tesla said it had delivered more than 367,500 cars last year -
up 50% from 2018. Investors expect the new factory to act as a springboard
that will allow it to capture more of the Chinese market.

 

Despite the increase, Tesla's sales remain small compared to those of its
competitors.

 

Volkswagen delivered almost 11 million vehicles last year, while Toyota sold
more than 9 million in the first 11 months of 2019.

 

Tesla has also never made an annual profit and it is facing investigations
after complaints about battery fires and unexpected acceleration.

 

The company is due to report its latest quarterly results to investors this
month.

 

If Tesla sustains the $100bn valuation, it could unlock the first piece of a
$2.6bn compensation package for Mr Musk.

 

The plans calls for Mr Musk to receive payouts in shares over 10 years, with
the first award contingent on the firm reaching $100bn in market
capitalisation and sustaining that value over both a month, and six-month
average.

 

Tesla also had to reach $20bn in revenue and earn $1.5bn, after adjusting
for items like taxes - thresholds the carmaker reached in 2018.

 

Tesla was valued at about $55bn when the pay deal was approved.--bbc

 

 

 

Coronavirus: Taobao warns firms not to profit from outbreak

Chinese online giant Taobao has warned sellers using its platform not to
profit from the deadly coronavirus outbreak by raising prices.

 

Fears over the spread of the virus in China have triggered a surge in sales
of protective gear in Asia.

 

Pharmacies have seen a rush for surgical masks, while rubber glove makers
are braced for a jump in demand.

 

At least 17 people have now died, with more than 500 confirmed cases across
China, and as far afield as the US.

 

Subsidy offer

Over the two days of 20 and 21 January more than 80 million masks were sold
on Taobao, which is owned by Alibaba and is one of the largest online
retailers in the world .

 

However, media reports suggested these included profiteers looking to
quickly resell the masks at a higher price.

 

This prompted the online message from Taobao warning sellers they were ''not
allowed to increase prices''. In November, a pack of 20 3M masks sold for
178 yuan (£20), but on Tuesday sellers were charging up to 1,100 yuan for
the same item, according to a report in Singapore's Straits Times newspaper.

 

Taobao said it would also offer ''special subsidies'' to make sure masks
were ''cost-effective'' for consumers. On top of this, it will also continue
delivery services during the Chinese New Year celebrations

 

Can wearing masks stop the spread of viruses?

Coronavirus: How worried should we be?

New China virus: Your questions answered

Joleen Siew at Glovida, an e-commerce site based in Singapore selling health
products, said it had seen a "significant spike in demand for masks compared
to normal".

 

"We've also seen more demand for immunity products like vitamins and
supplements as parents want to protect their kids. Singapore likes to be
pre-emptive about these things.''

 

Denis Low, president of the Malaysian Rubber Glove Manufacturers Association
which represents 56 members told the BBC: "I have spoken to the members and
we are all geared up if demand shoots through the roof as expected. We will
ramp up capacity and make some tweaks to productivity.''

 

Malaysia produces around two-thirds of the world's rubber gloves, predicted
to be more than 150 billion pairs this year.

 

During the H1N1 flu pandemic in 2009 and 2010, Malaysian rubber glove makers
saw a surge in orders of about 10%-15%. Mr Low, who works for glove maker
Supermax, said the increase could be higher this time if the coronavirus
continues to spread.

 

''We are very worried about this virus and will do all we can to make sure
we meet the demand. But we will not profiteer from this calamity by putting
up prices,'' he added.

 

Major airlines have said they will supply protective gear to cabin crew and
passengers who request them.

 

Hong Kong carrier Cathay Pacific was the first airline to announce it will
allow cabin crew to wear surgical masks while operating mainland China
flights due to infection concerns.

 

Singapore Airlines also said it is making surgical masks available to crew,
and other carriers operating in the region are expected to follow suit.

 

A Cathay Pacific spokeswoman said: ''We are monitoring the situation closely
and will continue to co-ordinate with the health authorities in Hong Kong
and in all the ports to which we operate flights'

 

As organisations take precautions to safeguard staff by buying masks and
gloves, Chinese technology giant Tencent is taking even more drastic steps.

 

Founder Pony Ma Huateng will not hand out traditional red packets to
employees to celebrate the Lunar New Year for fear of spreading the virus.

 

This is the first time in almost two decades Shenzhen-based Tencent has
cancelled this traditional handout to staff.--BBC

 

 

 

Chancellor tries to reassure firms on post-Brexit trade

Business leaders have welcomed what they call a clarification of the
government's view that there would be "no alignment" with EU rules in a
post-Brexit trade deal with the EU.

 

Chancellor Sajid Javid said the UK would use the power to diverge from
Europe only when it was in the interests of business.

 

Concerned businesses had questioned him at the World Economic Forum.

 

His words, just six days ago, caused shockwaves for British industry.

 

Businesses had assumed the UK would stay closely connected to European rules
and standards, where industry needed it.

 

Answering questions from UK chief executives at a Davos lunch, Mr Javid said
that although the UK could not be a rule taker, for democratic reasons, "it
doesn't mean we will diverge for the sake of it".

 

Business group the CBI welcomed the clarification that there could be scope
for continued alignment for the car or chemicals industry.

 

"It's good to have clarification that in terms of divergence from the EU,
that will be when it is in the economic interests of the country. It is not
an obligation, it's a right we can use if we need to use it," the CBI chief
Carolyn Fairbairn, host of the lunch, told the BBC.

 

Other attendees said they had made clear to the chancellor that
unnecessarily introducing friction into manufacturing supply chains would
reduce, not increase investment spending.

 

The chancellor dialled in to a key cabinet committee meeting on post
Brexit-trade strategy just after the lunch.

 

The purpose of such freedoms is to help the government forge new trade deals
with, for example, the US.

 

US-UK trade deal

Mixed news on that at the forum. On the one hand the US Treasury Secretary
said a US-UK deal could be done this year.

 

But on the other, sabre-rattling continued on issues such as an imminent
decision by the government to allow Chinese firm Huawei to supply some of
the new 5G mobile network in the UK.

 

Following yesterday's trade war threats over digital taxation, France agreed
with the US a delay in the collection of its digital tax until the end of
the year.

 

French finance minister Bruno Le Maire suggested to the BBC that "the best
solution" would be if everyone, including the UK, which will begin its tax
in April, instead focussed on an international solution.--BBC

 

 

 

Zambia's economy to grow by 3% in 2020 - President

LUSAKA (Reuters) - Zambia’s President Edgar Lungu said on Thursday the
country’s economy was expected to grow 3% this year, a slight reduction from
the 3.2% growth previously forecast.

 

Speaking during a meeting with diplomats, he also said the fiscal deficit
was expected to shrink from 6.5% in 2019 to 5.5% in 2020, while inflation
would remain within the range of 6-8%.

 

 

 

Trafigura to buy Angolan general's stake in Puma Energy -sources

LONDON (Reuters) - Global commodities trader Trafigura is in advanced talks
to buy more than 10% of an Angolan general’s stake in its fuel retail arm
Puma Energy by the end of the year, sources familiar with the matter said.

 

Retired general Leopoldino Fragoso do Nascimento, known as General Dino,
holds a 15% stake in Puma via his company Cochan Holdings. Trafigura holds
49% and Angola’s state firm Sonangol 28%.

 

Puma’s shareholding structure was put together under Trafigura’s former CEO
and founder Claude Dauphin, who was close to the former ruling Angolan
elite.

 

However, the Swiss firm’s hopes of listing Puma hit compliance hurdles owing
to the general’s presence as a significant stakeholder.

 

 

South Africa's African Rainbow Capital to raise stake in Alexander Forbes

JOHANNESBURG (Reuters) - South African investment company African Rainbow
Capital (ARC) will increase its shareholding in Alexander Forbes Group
Holdings Limited to 33.9% after Mercer Africa pulls out, all three companies
said on Wednesday.

 

“At the time of Mercer’s strategic investment in Alexander Forbes, our
relationship was at its initial stages. Since then, our commercial
relationship has become well established and Mercer no longer believes it is
as important to maintain an equity investment,” President and CEO of Mercer
Martine Ferland said.

 

As part of a proposed shareholder reorganisation following Mercer’s
decision, ARC will acquire 193 million Alexander Forbes shares, or 15%, from
Mercer at a price of 525 cents per share, amounting to 1,013 billion rand
($69.71 million), the firms said in a joint statement.

 

Alexander Forbes said the reorganisation will neither affect nor disrupt the
existing strategic alliance between Mercer, which holds 34.4%, and itself,
which includes all current commercial agreements and associated service and
product offerings.

 

ARC will also exchange shares held in Alexander Forbes Limited for shares
held in Alexander Forbes Group Holdings Limited, the firms added.

 

After the transaction, ARC will hold 33.9% of Alexander Forbes.

 

“Our further investment in Alexander Forbes is in line with our stated
strategy that Alexander Forbes is a key part of ARC’s financial services
strategy going forward and the strategic opportunities we see. We believe
real value can be unlocked for all stakeholders,” said Johan van Zyl, the
co-CEO of ARC.

 

Another related transaction will see Alexander Forbes repurchasing 200.8
million of its shares, or a 15.6% stake held by Mercer, for 1.034 billion
rand.

 

($1 = 14.3444 rand)

 

 

Promotions drive 20-week sales rise for South Africa's Clicks drug chain

JOHANNESBURG (Reuters) - South African drugstore chain Clicks Group reported
a 9.9% rise in 20-week sales on Thursday, driven by value promotions in the
deteriorating consumer spending environment.

 

Special offers have helped Clicks drive volume despite the squeeze on
retailers from high household debts, increased fuel and electricity prices,
slow economic growth and a hike in value-added tax.

 

Group turnover increased to 12.9 billion rand ($900 million) in the 20 weeks
to Jan. 12. Sales in its retail health and beauty units, which include
Clicks and franchise brands GNC, The Body Shop and Claire’s, rose by 9%.

 

“Our wide range of gifting and value offering, supported by the convenience
of the Clicks chain’s extensive retail and pharmacy footprint, ensured that
we maintained our robust sales momentum of recent years and sustained volume
growth,” Clicks group Chief Executive Vikesh Ramsunder said in a statement.

 

“This was achieved despite the increasing pressures on consumer disposable
income, negative sentiment and the serious impact of electricity load
shedding on retail trading hours and shoppers in general over the past two
months,” he said.

 

United Pharmaceutical Distributors, the group’s pharmaceutical distributor,
increased total managed turnover by 10.2% as the business traded well and
benefited from gaining new wholesale and distribution contracts.

 

($1 = 14.3325 rand)

 

 

 

ERG suspends Zambia refinery on shortage of cobalt, copper concentrates

LONDON (Reuters) - Eurasia Resources Group’s (ERG) Africa unit said on
Thursday it will suspend operations at Chambishi Metals in Zambia due to a
shortage of copper and cobalt concentrates required to produce cathode.

 

Zambia, Africa’s second-largest copper producer, has introduced a 5% import
tax on raw materials which has hobbled the flow of concentrates from mines
in neighbouring Democratic Republic of Congo.

 

“It was not possible to locate appropriate feedstock in Zambia. We are in
the process of placing the plant on care and maintenance,” ERG Africa said
in a statement.

 

The miner said it was engaged with stakeholders and was exploring other
sources of feed in order to resume operations.

 

The Chambishi Metals refinery has a capacity of 6,800 tonnes per annum of
cobalt metal and 55,000 tonnes per annum of copper metal. It is the only
plant in Zambia producing cobalt metal, according to the ERG’s website.

 

On Wednesday, the president of the Mineworkers’ Union of Zambia on Wednesday
told Reuters that ERG planned to cut 229 jobs at the end of January.

 

 

 

Kenyan shilling firmer on flows from flower exports, offshore investors

NAIROBI (Reuters) - The Kenyan shilling was firmer on Thursday supported by
dollar inflows from horticulture exports and offshore investors buying
government debt, traders said.

 

At 0733 GMT, commercial banks quoted the shilling at 100.75/95 per dollar,
compared with 100.85/101/05 at Wednesday’s close.

 

 

 

 


 

 


 

INVESTORS DIARY 2020

 


Company

Event

Venue

Date & Time

 


 

 

 

 

 


 

 

 

 

 


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
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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
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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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