Bulls n Bears Daily Market Commentary : 05 May 2020

Wed May 6 08:06:08 CAT 2020

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Bulls n Bears Daily Market Commentary : 05 May 2020

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Zimbabwe Stock Exchange Update

Market Turnover ZWL$10,481,199.35 with foreign buys at ZWL$660,930.00 and
foreign sales were ZWL $212,096.80 Total trades were 144.

The All Share index added 5.90 points to close at 498.28 points. CASSAVA
SMARTECH gained $0.2194 to $3.4763, FIRST MUTUAL PROPERTIES rose by $0.1700
to $1.3000 and MEIKLES increased by $0.1448 to end at $6.1548. ART  also
went up by $0.1225 to $0.7450 and DAIRIBORD  traded $0.0850 stronger at
$0.9150.

Gains were offset by losses in OLD MUTUAL LIMITED  which eased $1.1497 to
$41.8420, DELTA lost $0.0469 to $5.8014 and AFRICAN SUN was $0.0164 weaker
at $0.5000. Other counters to lose ground were MASH HOLDINGS  which dropped
$0.0144 to $0.2363 and OK ZIMBABWE which traded $0.0117 weaker at $1.9683.

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  Global Currencies & Equity Markets

South Africa

South Africa's rand recovers in global emerging market bounce

(Reuters) - South Africa’s rand firmed on Tuesday, shaking off a batch of
poor domestic data recently, as moves by several countries to ease
coronavirus lockdowns lifted global risk appetite.

Yields on government bonds fell sharply, reflecting strong prices, as the
first weekly bond auction since South Africa’s exclusion the World
Government Bond Index (WGBI) attracted strong demand.

At 1520 GMT the rand was 1.06% firmer at 18.3750 per dollar.

U.S. states California and New York on Monday outlined plans for reopening
businesses, while several other countries including Spain, Italy, Turkey,
India, and Malaysia also tentatively eased lockdowns.

In fixed income, the yield on the 10-year government paper fell 44.5 basis
points to 9.755%.

The Treasury sold a total of 4.53 billion rand ($247.49 million) worth of
its 2026, 2030 and 2032 bonds on Tuesday, with the bid-to-cover ratio on the
2030 bond rising to 8.3 from 4.7 last week.

South Africa lost its last investment-grade rating in March, forcing it to
be excluded from WGBI on Thursday. That means some large overseas funds will
no longer be able to hold the country’s debt.

Stocks ended flat, with the Johannesburg All-Share index unchanged at 49,184
points, while the Top-40 index inched 0.10% lower to 45,210 points.

The Top-40 was weighed down by gold stocks due to weaker bullion prices.
Gold fell as easing lockdowns and oil recovery boosted appetite for risk.

Gold Fields closed 5.35% lower at 142.10 rand, AngloGold Ashanti fell 4.76%
to 455.09, while Sibanye Stillwater weakened 4.71% to 37.20 rand.

EnX Group Ltd plunged 30.37% to 3.76 rand after it said the sale of its
fleet management business, Eqstra, to Bidvest Group Ltd has fallen through
after approval from the Prudential Authority (PA) failed to materialise
before a deadline for the transaction. ($1 = 18.3036 rand) 

Nigeria

Nigeria stocks post biggest rise in 3-months after lockdown is phased out

(Reuters) - Nigerian stocks rose 3.12% on Tuesday to record their biggest
rise in three months as shares gained across sectors a day after the
government began a gradual easing of a coronavirus lockdown.

The stock market, which has lost 14% so far this year, rose for the seventh
session to close at 23,809.31 points, an eight-week high, last seen in
March.

Nigerian funds have been switching back to equities from fixed-income
securities, hoping for a stock market rebound later this year after a
coronavirus-induced rout in oil prices prompted foreign investors to sell
off their holdings.

Meanwhile, stock exchange data showed4 foreign investors have been net
sellers of Nigerian equities this year, with the pace of outflows
accelerating in February as the coronavirus pandemic rattled global markets.

The index of Nigeria’s banking and consumer stocks both rose 2.42% each. The
oil and gas index climbed the least, up 0.73%.

Heavyweight Dangote Cement, which accounts for a third of market
capitalisation, rose 10%, the maximum allowed on the bourse. MTN Nigeria,
the second-biggest listed company, climbed 3.45%.

A total of 29 companies advanced while three were unchanged. Six firms
declined with a hundred others recording no trades. 

 <mailto:info at bulls.co.zw> 

GLOBAL MARKETS

Oil, stocks poised to gain in Asia on economic growth hopes

(Reuters) - Global stocks and crude prices were set to extend gains in Asia
on Wednesday on confidence that government steps to restart economies will
bring back growth and demand for oil.

Futures on major U.S. and Hong Kong stock indexes were up following gains in
a global stock index and an oil price surge of as much as 25%.

Financial markets had mostly dismissed grim economic losses from the
coronavirus pandemic, but had second thoughts later in the day, trimming
gains after downbeat comments from a senior member of the U.S. Federal
Reserve.

Futures for the S&P 500 rose 0.38%. Hong Kong’s Hang Seng index futures rose
0.32%.

However, Australian S&P/ASX 200 futures lost 0.20% in early trade.

Stock markets in mainland China will reopen for the first time since
Thursday after a holiday break.

On Wall Street, the S&P 500 rose as much as 2% during the day. The index cut
gains by just over half at the close after U.S. Federal Reserve Vice Chair
Richard Clarida warned that economic data would get much worse before
getting better, possibly in the second half of the year.

Gains in Brent in early Asia trade could extend the global benchmark’s
string of gains to seven straight sessions while West Texas Intermediate
rallied for the sixth consecutive session.

Fuel demand worldwide was down roughly 30% in April, but that has since
risen modestly due to efforts to lift travel restrictions.

The Dow Jones Industrial Average rose 0.56%, the S&P 500 gained 0.90%, and
the Nasdaq Composite added 1.13%.

MSCI’s gauge of stocks across the globe rose 1% overnight. The pan-European
STOXX 600 index closed nearly 2.2% higher.

U.S. Treasury yields rose on evidence of the increasing need for the
government to finance economic stimulus and in anticipation of an economic
recovery.

The yield on benchmark 10-year notes rose on Tuesday to 0.66% from 0.63%
late on Monday.

Traders will also be watching Wednesday for the ADP National Employment
Report of private U.S. payrolls. It could foretell the damage to be revealed
on Friday in the official U.S. government measure of jobs in April,
estimated to show nearly 22 million jobs were lost last month.

In line with rising Treasury yields, the U.S. dollar rose for a third
session on Tuesday against most major currencies.

The dollar index rose 0.287%he euro unchanged at $1.0838 after a ruling from
Germany’s highest court on Tuesday that the European Central Bank must
justify bond purchases under its flagship stimulus program or lose the
Bundesbank as a participant.

Spot gold dropped 0.2% to $1,702.55 an ounce.

 <mailto:info at bulls.co.zw> 

Commodities Markets

London copper nears 1-week high on prospects of demand recovery

(Reuters) - London copper prices rose to their highest in nearly a week on
Wednesday, amid hopes of better demand as countries start to ease
coronavirus-induced restrictions.

Bench mark three-month copper on the London Metal Exchange (LME)         was
up 0.8% at $5,198 a tonne, as of 0244 GMT, having hit its highest since
April 30 at $5,205 a tonne earlier in the session.

The LME contract on Wednesday climbed back to the same level seen before
Chinese traders took a break for their May 1-5 Labour Day holidays.    

The most-traded June copper contract on the Shanghai Futures Exchange
eased 0.5% to 42,600 yuan ($6,008.21) a tonne on its first trading day
following the break.

Some countries have announced plans to gradually remove restrictions that
were imposed to contain the coronavirus pandemic, and governments around the
world have been providing stimulus programmes to support their ailing
economies.

Copper, used as a gauge of global economic health, has leaped 19% on the LME
since March 19, when the contract hit a 45-month low, on improved demand
from top consumer China, supply shortage worries and hopes for a pick up in
global economy.

LME copper, however, lost 16% so far this year, as demand for the red metal
is still under pressure to what many describe as a long and bumpy road to
recovery ahead. 

Gold inches down as easing virus-led curbs buoy equities

(Reuters) - Gold prices inched lower on Wednesday as equities rose on upbeat
risk sentiment stemming from gradual reopening of many economies, while a
firmer dollar also weighed on prices. 

    FUNDAMENTALS

* Spot gold        fell 0.1% to $1,704.88 per ounce by 0119 GMT. U.S. gold
futures        rose 0.2% to $1,713.00 per ounce.

* Global stocks and crude prices were set to extend gains in Asia on
confidence that government steps to restart economies will bring back growth
and demand for oil.                   

* Against key rivals, the U.S. dollar        gained for a fourth straight
session, making gold costlier for investors using other currencies. 

* Italy and the United States were among several countries to tentatively
ease lockdowns earlier this week.  

* The U.S. trade deficit increased by the most in more than a year in March
as a record drop in exports offset a shrinking import.   

* The U.S. economy could start to recover in the second half of the year
after what is shaping up to be the worst recession in decades, but growth is
likely to be slow and uneven, several top Federal Reserve policymakers
indicated on Tuesday.

* Germany's highest court on Tuesday gave the European Central Bank three
months to justify bond purchases under its flagship stimulus programme or
lose the Bundesbank as a participant, raising questions about the scheme and
the euro's future.    

* SPDR Gold Trust      , the world's largest gold-backed exchange-traded
fund, said its holdings rose 0.4% to 1,076.39 tonnes on Tuesday from
1,071.71 tonnes on Monday.          

* Gold miner Newmont Corp's         adjusted profit nearly doubled on
Tuesday boosted by higher production and a surge in the prices of the
precious metal, as investors rushed to the safe-haven asset amid market
turmoil caused by the COVID-19 outbreak.     

* Palladium        rose 0.5% to $1,809.41 an ounce, after slipping to its
lowest since March 24 at $1,747.31 per ounce in the previous session. 

* Platinum        slipped 0.2% to $763.05 per ounce, while silver
fell 0.1% to $15.01 per 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
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
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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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