Bulls n Bears Daily Market Commentary : 03 June 2020

Thu Jun 4 06:15:15 CAT 2020

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Bulls n Bears Daily Market Commentary : 03 June 2020

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Zimbabwe Stock Exchange Update

Market Turnover ZWL$34,404,995.70 with foreign buys at ZWL$2,508,711.10 and
foreign sales were ZWL $6,541,576.00 Total trades were 304.

The All Share index gained a significant 134.19 points to close at 1,514.75
points. CAFCA rose by $5.7500 to $34.5000, DELTA added $4.1649 to close at
$25.8744 and SEEDCO INTERNATIONAL LIMITED rose by $3.4000 to $20.6000.
SEEDCO also increased by $2.9253 to $17.7500 and CBZ recovered $2.5879 to
$15.7500.

Gains were partially offset by losses in POWERSPEED which lost $0.0527 to
$1.5500, MEDTECH eased $0.0092 to end at $0.1608 and STAR AFRICA CORPORATION
was $0.0046 weaker at $0.1829. EDGARS also decreased by $0.0029 to $1.3271
and MASHONALAND HOLDINGS traded $0.0016 lower at $0.6984.

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Global Currencies & Equity Markets

South Africa

South Africa's rand climbs to 11-week peak, markets rally

(Reuters) - South Africa’s rand extended gains to a fresh 11-week high on
Wednesday in a broad emerging market rally spurred by investor bets that a
global economic recovery was taking hold after the coronavirus fallout.

The stock market mirrored the upbeat sentiment of the currency to scale a
13-week peak on Wednesday.

At 1515 GMT the rand was 1.64% firmer at 16.8900 per dollar, it best level
since March 18, crossing the key 17.00 psychological threshold towards
pre-coronavirus levels, having opened trade at 17.1400.

The day brought the local currency’s gains this week to around 4%, in-line
with majority of emerging market currencies, with rising appetite for risk
assets outweighing signs of an ailing local economy.

South Africa’s Purchasing Managers’ Index (PMI) contracted again in May,
reaching a record low, as output and new sales collapsed during the
nationwide coronavirus lockdown that began in March.

Governments and central banks around the world have unleashed unprecedented
fiscal and monetary stimulus and other support for economies floored by the
coronavirus pandemic.

The stimulus action has also overshadowed simmering tensions between Beijing
and Washington over Hong Kong, and ongoing protests in the U.S. over recent
police killings.

The FTSE/JSE top 40 companies index surged 2.03% to close the day’s trading
at 49,300 points. The FTSE/JSE all share index closed up 2.19% to 53,645
points.

The market rally was led by the country’s banks which jumped on hopes that a
faster economic recovery will boost loan growth in a low interest rate
environment. The banking index was up 10.42%.

Bonds also firmed, with the yield on the 10-year instrument down 7 basis
points to 8.665%. 

Kenya

Kenyan shilling gains ground, agricultural exports help

(Reuters) - The Kenyan shilling gained ground on Wednesday, helped by
inflows from agricultural exports and low dollar demand from merchandise
importers, traders said. 

At 0822 GMT, commercial banks quoted the shilling at 106.45/65 per dollar,
compared with 106.55/75 at Tuesday's close. 

 <mailto:info at bulls.co.zw> 

GLOBAL MARKETS

Asian shares hit two-month high as economic optimism spreads

(Reuters) - Asian shares rose to a two-month high on Thursday as government
stimulus expectations supported investor confidence in an economic recovery
from the global coronavirus pandemic.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.4%,
earlier touching the highest since March 9.

Shares in Australia rose 0.66% after the country’s prime minister unveiled a
fourth stimulus package to repair the economy.

Chinese shares were little changed due to lingering worries about diplomatic
tension between the United States and China, while U.S. stock futures fell
0.23%.

The euro held onto gains before a European Central Bank meeting later on
Thursday, where policymakers are expected to increase debt purchases to
support the bloc’s weakest economies.

Oil prices fell, reversing gains made the previous session, due to
uncertainty about supply cuts by major producers.

Markets for risk assets have been on a tear, carrying some stock market
indexes to within sight of levels before the coronavirus outbreak.

The Nasdaq Composite,, the S&P 500, and the Dow Jones Industrial Average are
close to overtaking all-time closing highs registered in February.

Elsewhere in Asia, Japanese shares snapped a three-day winning streak and
fell 0.06%.

Hong Kong’s stock market gave up early gains and traded 0.12% lower due to
concerns about Beijing’s plans for a new national security law for the
former British colony.

The euro held near multi-month highs in Asia amid growing expectations the
ECB will increase the size of its 750 billion euro ($669 billion) Pandemic
Emergency Purchase Programme, when it meets on Thursday.

The yield on the benchmark 10-year eased slightly to 0.7425% in Asia on
Thursday.

A closely watched part of the U.S. Treasury yield curve measuring the gap
between yields on two- and 10-year Treasury notes, reached 55 basis points
on Wednesday, the steepest level since mid-March. A steepening curve often
points to a stronger economy.

Governments around the world have gradually started to lift tough lockdown
measures imposed to contain the coronavirus which has infected nearly 6.4
million people and killed over 379,000.

Markets await Friday’s U.S. Labor Department May jobs report, which is
expected to show the unemployment rate soaring to a post-World War Two high
of nearly 20% from 14.7% in April.

On Wednesday, a report showed U.S. private payrolls fell less than expected
in May, suggesting layoffs were abating as businesses reopen.

U.S. crude dipped 1.85% to $36.60 a barrel. Brent crude fell 1.18% to $39.32
per barrel.

Spot gold rose 0.4% to $1,704.31 an ounce early on Thursday after losing 1.6
% on Wednesday.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Copper touches March high on recovery in top consumer China

(Reuters) - Copper hit its highest since March on Thursday, buoyed by the
prospect of higher demand from top consumer China after data showed a strong
performance in its services sector. 

China's services sector returned to growth last month for the first time
since January as the economy recovers from strict coronavirus containment
measures, a private survey showed.

Prices for copper, which are up about 26% since March lows, have been
supported by higher consumption from China's infrastructure and construction
sectors and hopes for a global economic recovery as nations reopen their
economies.

Benchmark copper on the London Metal Exchange (LME) eased by 0.1% to $5,522
a tonne in official trading after touching its loftiest since March 13 at
$5,549.50.

CHINA STIMULUS: China's central bank vice-governor said the economic hit
from the coronavirus pandemic was bigger than expected and that more
monetary and credit policy support was needed.  

U.S JOBS: Private payrolls in the United States fell less than expected in
May, with employers laying off another 2.76 million workers.   

CHILE EARTHQUAKE: A magnitude 6.8 earthquake struck northern Chile early on
Wednesday morning, the GFZ German Research Center for Geosciences (GFZ)
said. 

Copper mines and smelters owned by Antofagasta and state miner Codelco are
near the region, broker Marex Spectron noted. 

CRITICAL MINERALS: The U.S. State Department hopes to expand a strategic
minerals initiative aimed at ensuring supply chains for metals critical for
batteries and wind and solar power as demand for green energy continues to
grow, a top diplomat said.

OTHER PRICES: LME aluminium rose 0.6% to $1,555.50 a tonne, zinc slipped
0.5% to $2,010.50, lead  was stable at $1,718, tin  edged down 0.1% to
$15,991 and nickel      added 0.3% to $12,885 after touching its highest
since March 10.    

Mali's industrial gold production expected to slump in 2020

(Reuters) - Industrial gold production in Mali is expected to fall by 8.3%
year-on-year to 59.77 tonnes this year compared with 2019 due to falling
output at several

mines, Mali's mines and petroleum ministry said on Wednesday.

It said total gold production is expected at 65.7 tonnes in 2020, including
6 tonnes from the artisanal, or small-scale mining sector, compared with
71.1 tonnes a year ago.

Companies operating in Mali's mining sector includes Barrick Gold, Resolute
Mining, Anglogold Ashanti and B2Gold.

Reserves at Anglogold Ashanti's Sadiola mine is reaching depletion phase,
and will produce 832 kg compared with 4.6 tonnes last year, mines ministry
official Mamadou Sidibé told Reuters.

He added that output at Barrick's Morila mine is expected at 1.9 tonnes,
compared with 3.5 tonnes the previous year, while Resolute's Finkolo mine
will produce 440 kg compared 6.6 tonnes in 2019.

Other mines, such as Resolute's Somisy, and B2Gold's Fekola mines, are
expected to boost production, the ministry said. 

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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