Bulls n Bears Daily Market Commentary : 10 March 2020

Wed Mar 11 03:16:58 CAT 2020

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Bulls n Bears Daily Market Commentary : 10 March 2020

 <mailto:info at bulls.co.zw> 

Zimbabwe Stock Exchange Update

Market Turnover ZWL$30,010,519.32 with foreign buys at ZWL$6,827,708 and
foreign sales were ZWL$3,850,452 Total trades were 232

The All Share index advanced by adding 7.01 points to close at 478.35
points. CAFCA gained $0.7500 to end at $15.0000, DELTA CORPORATION added
$0.2403 to $6.5185 and NATIONAL FOODS LIMITED  was $0.2000 stronger at
$20.4000. ECONET WIRELESS  also increased by $0.1906 to $2.7031 and INNSCOR
AFRICA LIMITED  traded $0.1385 firmer at $7.8086.

Gains were offset by losses in OLD MUTUAL LIMITED eased $0.4834 to $50.0254,
NAMPAK ZIMBABWE LIMITED lost $0.2000 to $0.8000 and ALMAGAMATED

REGIONAL TRADING CORPORATION   was $0.0800 lower at $0.6000. FIRST MUTUAL
LIMITED  also decreased by $0.0794 to $0.8006 and AFRICAN SUN  traded
$0.0500 weaker at $0.6000.

. <mailto:info at bulls.co.zw> 

  Global Currencies & Equity Markets

South Africa

South Africa's rand rebounds as global selloff slows

(Reuters) - South Africa’s rand firmed on Tuesday, recovering most of its
losses as emerging markets broadly recovered from heavy selling in the
previous session triggered by a dive in oil prices and fears about the
economic impact of the coronavirus.

Stocks rose in line with a rebound in global markets, while FirstRand shares
rose after half-year profits.

At 1500 GMT the rand was 0.21% firmer at 16.0760, having tumbled to just
short of 17.00, a four-year trough, on Monday as panic selling in Asia
spread to the south and western hemispheres.

A price war between top producers Saudi Arabia and Russia triggered the
biggest daily rout in oil prices since the 1991 Gulf War, with crude prices
diving more than 25%, kindling a deep selloff across risk assets already
reeling from coronavirus fears.

But an announcement by the United States of plans to take more measures to
support its economy soothed some of those worries, while a rebound in oil
prices also helped risk demand.

On the bourse, the benchmark Top-40 index gained 1.29% to 44,252 points
while the All-Share index rose 1.32% to 49,466 points.

FirstRand closed up 4.52% to 52.60 rand after posting a 5% rise in interim
profit.

Curbing further gain, bullion stocks fell 7.7% amid profit taking after risk
sentiment improved, with AngloGold Ashanti down 8.25% to 301.87 rand and
Gold Fields 5.51% lower at 102.60 rand.

Bonds also recovered, with the yield on the government issue due in 2030
down 4.5 basis points to 9.175%. 

Kenya

Kenyan shilling steady on easing dollar demand

(Reuters) - The Kenyan shilling held steady on Tuesday supported by easing
appetite for dollars from commercial banks, traders said. 

At 0853 GMT, commercial banks quoted the shilling at 102.75/95 per dollar,
the same as Monday's close.

GLOBAL MARKETS

Oil jumps 10%, U.S. stocks rebound after market rout

(Reuters) - Oil and global equity markets charged back on Tuesday after the
prior day’s steep losses as the world’s biggest economies moved to cushion
the impact of the coronavirus, but stock gains in Europe failed to hold as
investors remained skittish.

The price of Brent crude climbed 10% on hopes a supply cut deal could be
rescued and most benchmark government bond yields rose from record lows as
governments outlined broad measures to confront the epidemic’s economic and
human toll.

U.S. President Donald Trump said he will ask Congress for a payroll tax cut
and other “very major” stimulus moves to ease the economic pain, but details
were still forthcoming.

During a White House meeting with health executives, Trump also said the
U.S. administration intended to help airlines and the cruise line industry.
He later met with Republican senators to discuss proposals for boosting the
economy.

Japan unveiled a second package of measures worth about $4 billion in
spending, focusing on support to small and midsized firms.

U.S. stocks jumped more than 3% at the open, pared gains to trade briefly
negative and then roared back to close up almost 5%. Investors hoped
Monday’s rout marks the low of a downturn that has pushed Wall Street’s
major indexes close to a bear market - defined as a decline of 20% from
recent peaks.

The S&P 500 forward price-earnings ratio for this year fell to 15.8 as of
Monday, in line with the historic average and down from 19.3 less than a
month ago, according to Refinitiv.

Comments by Vice President Mike Pence that private U.S. health insurance
companies have agreed to cover coronavirus treatment and waive co-payment
fees for testing helped U.S. stocks rebound.

On Wall Street, the Dow Jones Industrial Average rose 1,166.7 points, or
4.89%, to 25,017.72. The S&P 500 gained 135.65 points, or 4.94%, to 2,882.21
and the Nasdaq Composite added 393.58 points, or 4.95%, to 8,344.25.

MSCI’s gauge of stocks across the globe gained 2.55% but the pan-European
STOXX 600 index lost 1.14%, after initially trading higher. A jump in
infections in Italy, Germany and Britain unsettled investors.

The major European bourses remained in bear territory. The FTSE 100 in
London almost eked out a gain but closed down 0.1% as oil companies
rebounded from the carnage on Monday as Saudi Arabia and Russia engaged in a
price war.

Yields on benchmark U.S. 10-year Treasury debt more than doubled to 0.801%
and those on German Bunds jumped around 20 basis points at one point as
investors pared some safe-haven holdings, though they were beginning to ease
again.

Many strategists and economists expect the Federal Reserve to cut U.S.
interest rates to zero as part of a global move to provide strength and
liquidity to the financial system.

The dollar rallied after huge losses against the safe-haven Japanese yen and
Swiss franc, but analysts said it was too early to predict a floor.

Stocks in Asia rebounded, with Japan’s Nikkei closing up 0.85% after
touching its lowest level since April 2017.

China’s benchmark Shanghai Composite Index traded 1.8% higher as new
domestic coronavirus cases tumbled and President Xi Jinping’s visit to the
epicenter of the epidemic lifted sentiment.

The oil rally had the most horsepower. About half of oil’s massive losses
from Monday were clawed back, offering hope that markets had found a floor
despite still-fragile sentiment.

Russian oil minister Alexander Novak said he did not rule out joint measures
with the Organization of the Petroleum Exporting Countries to stabilize the
market.

Benchmark Brent crude futures rose 8.3% to settle at $37.22 a barrel,
roughly half this year’s peak, reached in January. U.S. crude gained 10.4%
to settle at $34.36.

Gold prices fell 1%, retreating from the previous session’s jump above the
key $1,700 level, as safe-haven demand waned a little amid speculation about
global stimulus measures.

U.S. gold futures settled down 0.9% at $1,660.30 an ounce.

The bond market has priced in a global recession of unknown length.
Investors are fully pricing an easing of at least 75 basis points at the
next Fed meeting on March 18, while a cut to near zero was seen as likely by
April.

Yields on 10-year U.S. Treasuries dipped to as little as 0.318% on Monday -
a level unthinkable just a week ago - but climbed back to 0.6787% on Tuesday
amid the stimulus chatter.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Copper bounces on plans for Chinese, global stimulus

(Reuters) - Copper prices rebounded on Tuesday from multi-year lows in the
previous session as coronavirus cases dropped in China and nations around
the world geared up to pump stimulus into their economies.

Other industrial metals also bounced, along with oil and equity markets,
with the United States and Japan among those announcing plans to counter the
impact of the virus and support economic growth.

Also lifting sentiment was a visit by Chinese President Xi Jinping to the
outbreak epicentre in the central city of Wuhan after a sharp drop in new
cases in mainland China in the past week.

Wood-Dow said the stimulus in top metals consumer China was expected to
total around 6-8 trillion yuan, equivalent to around 8% of GDP.

Benchmark three-month copper on the London Metal Exchange had gained 1.7% to
$5,628 a tonne by 1055 GMT after sinking to $5,433 on Monday, the weakest in
more than three years.

* CHINA RECOVERY: Factories in China slowly coming back online raised hopes
of an uptick in demand.

“In China, the semi-fabricator industry is improving slowly,” CRU Group
analyst He Tianyu said, adding that demand from the construction and
infrastructure sectors was also improving, albeit at a slower pace.

The utilisation rate at copper semi fabricators, which process the metal
into products such as wire-rod or tubes, has picked up to 60% from 40%-50% a
week earlier as more people return to work, the analyst added.

* CHINA: Business and travel activities are steadily recovering, but rapidly
rising infections globally will pose a challenge to the country’s broader
economic resumption.

* CHILE COPPER: Copper output at Codelco, the world’s top copper miner,
plunged 6.8% in January from a year earlier while production at BHP’s
Escondida, the world’s largest copper mine, rose 10%.

* PRICES: LME aluminium rose 1.5% to $1,712.50 a tonne, zinc gained 2.2% to
$2,023, lead climbed 2.7% to $1,847.50, nickel advanced 2.3% to $12,945 and
tin increased by 1.9% to 17,015.

Gold dips 1% on expected global measures to soften virus blow

(Reuters) - Gold prices fell more than 1% on Tuesday, pulling back after
breaching $1,700 in the previous session, as risk sentiment improved and the
dollar firmed on expected global support measures to soften the economic
impact from the coronavirus.

Spot gold lost 1% to $1,662.56 an ounce by 1206 GMT. U.S. gold futures fell
0.7% to $1,663.70.

Stimulus hopes and recovering crude oil prices are also leading to a
recovery for risky assets and a move out of safe havens, Fertig added.

Bullion rose as much as 1.7% on Monday to its highest since December 2012 at
$1,702.56 after a rout in global equity markets on fears over the
coronavirus and a crash in crude oil prices triggered by a price war between
top producers Saudi Arabia and Russia.

U.S. President Donald Trump said he would take steps to bolster the economy
and Japan unveiled a second package of measures worth about $4 billion to
cope with fallout from the virus outbreak.

European shares rose and bond yields increased from record lows on stimulus
hopes while the dollar firmed against rivals.

However, investors remained cautious as total global infections touched
111,600 by Monday.

Apart from the virus-led uncertainty, the global implications of the oil
price war would also support gold in the near term, said FXTM market analyst
Han Tan.

Investors are now focused on a European Central Bank policy meeting on
Thursday, where it is expected to follow the U.S. Federal Reserve by easing
interest rates. Markets are also expecting another cut at the Fed’s March 18
meeting.

Holdings in the world’s largest gold-backed exchange-traded fund, SPDR Gold
Trust, rose to 30.99 million ounces, its highest since October 2016.

In other precious metals, palladium fell 2.5% to $2,428.30 an ounce, silver
gained 0.7% to $17.08 and platinum rose 2.6% to $885.01.

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
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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
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