Major International Business Headlines Brief::: 05 October 2020

Mon Oct 5 08:51:15 CAT 2020

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Major International Business Headlines Brief::: 05 October 2020

 <mailto:info at bulls.co.zw> 

ü  McDonald's among food firms urging tougher deforestation rules

ü  Coronavirus: 'World's best airport' warns of prolonged crisis

ü  Ola: London bans Uber rival over safety concerns

ü  Cineworld to shut down UK screens after Bond film delay

ü  Nigeria Chargé d'Affaires in Japan Expresses Optimism for Improved Relations

ü  Japan Now Nigeria's 5th Largest Foreign Investor, Says Embassy

ü  Africa Union Tackles Non-Tariff Barriers

ü  Bank of Thailand Launches World's First Government Savings Bond on IBM Blockchain Technology

ü  Vedanta's Profit Drops 23.5% As Virus Lockdown Hurts Output, Demand

ü  Asian Tech Giant Snaps Up Avaloq

ü  Asian markets rally after Trump signals optimism on coronavirus recovery

ü  Oil prices fall

ü  Gold extends gains

ü  SA rand rally pauses

 <mailto:info at bulls.co.zw> 

McDonald's among food firms urging tougher deforestation rules

Food firms in the UK including McDonald's are urging the government to toughen up rules designed to protect rainforests.

Ministers are planning a new law forbidding big firms to use produce from illegally deforested land.

But the firms say the law should apply to all deforestation, whether it's legal or illegal.

That's because the effect on the climate, and on nature, is the same if trees are felled legally or not.

The firms have written a letter to the government on the closing day of its consultation on forest protection.

It says: "Restricting action to illegal deforestation would not achieve halting the loss of natural ecosystems, especially when governments have discretion to decide what is legal."

The 21 signatories include including Unilever, Tesco, Lidl, Nando's, Nestle, the convenience food maker Greencore and the chicken producer Pilgrim's Pride.

Currently the government's plans refer only to major companies like these, but the signatories say this would allow medium-sized firms to continue importing large amounts of commodities from previously forested land.

They are pressing for a level playing field so smaller operators don't gain a competitive advantage.

The letter represents something of a breakthrough for environmental campaigners.

They've have long argued that it's pointless for the UK to protect its own landscape - as the Prime Minister says he intends - if ingredients in food or fodder such as beef, cocoa, soy, rubber and palm oil have contributed to environmental destruction abroad.

Robin Willoughby, from the green group Mighty Earth said: "The proposed legislation would continue to allow rampant deforestation in hotspots such as Indonesia and Brazil (where much of the deforestation is legal).

"With the Amazon in flames and forests being cut down at an alarming rate, Nature doesn't recognise the difference between legal and illegal deforestation."

A government spokesperson agreed that the expansion of agriculture should not damage other ecosystems and promised ministers would explore ways of avoiding this "displacement" effect.

The spokesperson said tackling illegal forest-felling was the obvious place to start.

She added: "Our proposed approach is designed to tackle illegal deforestation which accounts for nearly 50% of deforestation globally, but nearer 90% in key biomes, including part of the Amazon.

"Were existing forest laws in Brazil to be properly enforced, experts believe that forest cover would increase by 10%."

Chris Brown, Sustainable Sourcing Director at Asda, said: "We welcome efforts the government has made so far to tackle deforestation.

"But current plans won't do enough to protect fragile ecosystems.

"We need comprehensive reporting up and down the supply chain, alongside incentives for suppliers who move towards more environmentally-responsible production."

There has been growing dissatisfaction among consumers about products connected to illegal deforestation, especially in the Amazon.

According to a recent survey from the environment group, WWF, 67% of British consumers say they want the government to do more to tackle the issue.

Some 81% of respondents wanted greater transparency about the origins of products imported into the UK.

Fuelling these concerns are reports showing that deforestation in the Amazon has increased sharply this year.

The felling of trees and the clearing of land, usually for agriculture, is estimated to be responsible for 11% of global greenhouse gas emissions.

Although some environmentalists have supported the letter to government, other say the proposed targets are inadequate.

McDonald's, for instance, has set a deadline of 2030 for removing rainforest products from its supply chain - a date critics say is far too late.—bbc

Coronavirus: 'World's best airport' warns of prolonged crisis

Singapore's Changi Airport has warned of a "daunting period" ahead as the impact from the Covid-19 pandemic shows no signs of abating.

The Asian transit hub is regularly voted world's best airport for the 60m to 70m passenger range.

Changi has suspended operations in two terminals as flights have dropped to the lowest levels in its history.

It has also suspended the construction of a fifth terminal for at least two years.

"The battle with Covid-19 has only just begun," Changi Airport Group said in its annual report. "The future does appear daunting with the situation showing no signs of abatement."

The company's yearly results cover the period up until the end of March 2020. This misses out on the much of the severe downturn in passengers since the pandemic took hold in January. Singapore barred the entry and transit of short-term visitors on 23 March.

But the impact from those months still had a big impact, wiping out earlier gains built up over much of 2019. Profits plunged 36% to S$435m ($319m, £246m).

For 2020 Changi was voted the world's best airport for an eighth consecutive year, according to rankings by UK-based analysts Skytrax.

Last year, Changi Airport opened Jewel, a shopping and entertainment complex covering 1.5m square feet (14ha). It includes stores and attractions including a rainforest, hedge maze and the world's highest indoor waterfall.

This new complex has helped cushion the blow from the downturn in visitors, boosting revenue 2.6% to S$3.1bn.

"Jewel is a new icon for Singapore and has redefined what it means to be an airport," Changi Airport Group added.

But the group still paints a grim picture of the international travel hub and says the recovery is "highly dependent on how countries around the world manage border controls, the relaxation of air travel requirements and the development of viable medical treatments for the virus."

Last week, US airlines began laying off thousands of workers after efforts to negotiate a new economic relief plan in Congress stalled.

And this month the aviation trade body, the International Air Transport Association (IATA), downgraded its 2020 traffic forecasts, after "a dismal end to the summer travel season".

The IATA estimates that it will be at least 2024 before air traffic reaches pre-pandemic levels.--bbc

Ola: London bans Uber rival over safety concerns

Transport for London (TfL), the capital's transport authority, has banned Indian taxi app Ola over public safety concerns.

The cab company has been operating in London since February.

TfL said the firm reported a number of failings including more than 1,000 trips made by unlicensed drivers.

Ola said it will appeal the decision and has 21 days to do so. It can operate in the meantime, according to the appeal rules.

The transport authority said Ola did not report the failings as soon as it knew about them.

"Through our investigations we discovered that flaws in Ola's operating model have led to the use of unlicensed drivers and vehicles in more than 1,000 passenger trips, which may have put passenger safety at risk," Helen Chapman, TfL's director of licensing, regulation and charging, said.

"If they do appeal, Ola can continue to operate and drivers can continue to undertake bookings on behalf of Ola. We will closely scrutinise the company to ensure passengers safety is not compromised."

Uber win

The ride-hailing company began operating in Cardiff in 2018 and has since spread to other UK locations.

"We have been working with TfL during the review period and have sought to provide assurances and address the issues raised in an open and transparent manner," Marc Rozendal, Ola's UK Managing Director, said in a statement.

"Ola will take the opportunity to appeal this decision and in doing so, our riders and drivers can rest assured that we will continue to operate as normal, providing safe and reliable mobility for London."

Last week, major rival Uber secured its right to continue operating in London after a judge upheld its appeal against TfL.

The ride-hailing giant has been granted a new licence to work in the capital, nearly a year after TfL rejected its application, also over safety concerns because of unlicensed drivers.

Westminster Magistrates' Court heard that 24 Uber drivers shared their accounts with 20 others which led to 14,788 unauthorised rides.-bbc

Cineworld to shut down UK screens after Bond film delay

Cineworld is set to temporarily close its UK cinemas in the coming weeks.

As first reported in the Sunday Times, the firm is writing to Prime Minister Boris Johnson and Culture Secretary Oliver Dowden to say the industry is now "unviable".

The firm says it has been hit by delays in the release of big-budget films, putting 5,500 jobs at risk.

The premiere of James Bond film No Time To Die has been postponed twice and is now due for release in April 2021.

'No-one untouched'

It is hoped that the Cineworld cinemas will be able to reopen next year, with staff being asked to accept redundancy in the hope of rejoining the company when theatres open again.

The head of the UK Cinema Association said he feared the Cineworld closure was "indicative of challenges faced by the entire UK cinema industry at the moment".

Phil Clapp said: "Although cinemas opened in July and have been able to deliver a safe and enjoyable experience, without major new titles then we understand we aren't able to get as many people out of the home as we'd like."

He said no-one would be "untouched by the current challenges".

Philippa Childs of entertainment and broadcasting union Bectu said: "The delay in the release of the Bond film along with the other delayed releases has plunged cinema into crisis.

"Studios will have to think carefully when considering release dates about the impact that will have for the long-term future of the big screen."

When approached by the BBC, major UK chains Vue and Odeon refused to comment on how many cinemas they might be keeping open.

The Department for Digital, Culture, Media and Sport said it was supporting cinemas through a VAT cut on tickets and concessions, business rates holiday and bounce-back loans.

"We urge the British public to support their local cinema and save jobs by visiting and enjoying a film in accordance with the [Covid-19] guidance."

Mothballed cinemas

Cineworld's sites in the US, where it operates 546 theatres, could also be forced to close.

Cineworld said in a statement: "We can confirm we are considering the temporary closure of our UK and US cinemas, but a final decision has not yet been reached.

"Once a decision has been made we will update all staff and customers as soon as we can."

In September the firm reported a $1.6bn (£1.3bn) loss for the six months to June as its cinemas had to close because of coronavirus lockdowns.

And it warned at the time that it might need to raise more money in the event of further restrictions - or film delays - due to Covid-19.

Cineworld is the world's second largest cinema operator, and the largest in the UK with 120 sites. It also owns the Picturehouse chain of smaller venues.

Its other theatres globally include the Regal, Cinema City, and Yes Planet brands.

Social distancing in cinemas

According to the UK Cinema Association, operators should "organise seating to ensure two-metre distancing can be maintained; where two metres is not viable, one metre with risk mitigation is acceptable. Mitigations should be considered and those introduced set out in the risk assessment".

But in Scotland they must "organise seating to ensure two-metre distancing can be maintained".

It also says cinemas should introduce one-way flow through auditoriums, and provide floor markings and signage to remind customers to "follow social distancing wherever possible."

The film industry had hoped the release of No Time To Die would spark a movie-going revival in the UK, with so many cinemas having been mothballed for months following the Covid-19 lockdown in March.

But on Friday the movie's release was further delayed until 2 April 2021 "in order to be seen by a worldwide theatrical audience".

'Devastating year'

Rob Arthur, an industry analyst at cinema strategists The Big Picture, said "the current market is broken".

"It has been a very challenging year both for Cineworld, and the world's largest cinema group AMC," he added.

"Film release schedules are being changed on a daily, never mind weekly, basis. It has been a catastrophic, devastating, year for operators."

He said the decision by Cineworld to put their UK operation "into hibernation" until next year made sense.

"You can't keep meeting the fixed operating costs of electricity, gas, air conditioning, staff, social distancing measures, and so forth when audience numbers are only a small percentage of what they were before," he said.

"Meanwhile, customer confidence in visiting cinemas has to be restored and I don't see that at the moment," Mr Arthur added.

"The crowds you used to see in London for example going from work directly to the cinema are not there."

He also said Cineworld's cash reserves were running low and that both they and AMC had a high percentage of financial liabilities compared with their assets.

He added: "Landlords to date have acted reasonably and the deferral of rent has helped the cinema industry, but that comes to an end as does furlough payments so the operators will have to seek remedies to restructure their businesses."

Deal scrapped

As lockdown restrictions around the world were gradually lifted in mid-to-late summer Cineworld had been able to reopen 561 out of 778 sites worldwide.

But lockdown closures meant its group revenues sank to $712.4m in the first six months of the year, compared with $2.15bn a year earlier.

The group loss this year also marked a huge fall from the pre-tax profits of $139.7m seen in the first six months of 2019.

However, when it released those financial figures, Cineworld said recent trading had been "encouraging considering the circumstances", with solid demand for Christopher Nolan's spy film Tenet which was released in September.

In June, Cineworld pulled out of a $2.1bn deal to buy the Canadian cinema chain Cineplex, a move which could lead to a legal battle.

It is not just Cineworld which has struggled this year, with independent London cinema Peckhamplex closing its doors on 25 September due to falling visitor numbers and delayed releases.

It had hoped to reopen in November, around the time the next James Bond film was due to be released.--bbc

Nigeria Chargé d'Affaires in Japan Expresses Optimism for Improved Relations

The Chargé d'Affaires, Embassy of Nigeria in Japan, Tope Elias-Fatile, has congratulated Nigeria for its 60th independence and 60 years of diplomatic relations between Japan and Nigeria.

The envoy who gave the double congratulations in his message to mark Nigeria's 60th Independence Anniversary in Abuja yesterday, was optimistic about improved relations between the two countries.

He decried that the nation is celebrating the anniversaries at a challenging period globally, occasioned by the devastating effects of Coronavirus pandemic with adverse impact on economic and other activities across nations.

According to him, "On behalf of the government of the Federal Republic of Nigeria, I congratulate Nigerians in Japan on the 60th Independence Anniversary of our beloved country.

"This year also marks the 60th Anniversary of the establishment of diplomatic relations between Nigeria and Japan."

The envoy said that in spite of the current challenges, Nigeria and Japan still enjoyed improvements in trade and economic relations, pointing out that the number of Japanese companies in Nigeria grew from 32 in 2017 to 43 in 2020.

He said that the Japanese companies were engaged in different sectors, including power generation, transmission and distribution, agriculture, machinery, automobile, manufacturing, engineering, electronics, infrastructure, food and seasoning.

"Although we have not been able to build substantially on the gains we garnered in 2019, the Embassy is undeterred. We believe that Nigeria and Japan will overcome COVID-19 and come out of this challenging period stronger.

"Therefore, we look forward with great optimism to actualise the initiatives we have in the pipeline and consolidate on the achievements we recorded in 2019/2020.

"As soon as the situation begins to normalise, we shall take steps to pursue Nigerian-Japan relations with vigour and resolute determination, through robust engagements in economic and trade activities.

"We shall continue to bolster the networks of trade and economic activities between relevant actors and stakeholders from both countries," Elias-Fatile added.Leadership.

Japan Now Nigeria's 5th Largest Foreign Investor, Says Embassy

Abuja — The Embassy of Nigeria in Japan has disclosed that Japan is the fifth foreign investor in Nigeria, saying there are steady improvements in trade and economic relations between the two countries before the outbreak of COVID-19.

In a statement by the Charge de' Affairs, Dr. Tope Elias-Fatile on Friday, the embassy disclosed that the number of Japanese companies in Nigeria had increased from 32 in 2017 to 43 in 2020.

Citing the figure of Nigerian Investment Promotion Commission (NIPC), the embassy said Japan "is fifth foreign investor in Nigeria; also among the top 10 investors in services in Nigeria; among the top 10 investors in solid minerals, fifth investor in oil refining and fifth investor in real estate."

The statement said that Japan "is among Nigeria's top 20 import partners and Nigeria's top 20 export partners."

The statement said both countries had commenced preparations for the ninth Session of the Nigeria-Japan Special Partnership Forum (NJSPF) scheduled for June in Tokyo; but it was postponed.

It said the NJSPF "is a framework for regular consultations on matters of mutual interest between the two countries. The forum was upgraded to the level of bi-national cooperation at the 6th Session held on August 22 and 23, 2013 in Abuja.

"Despite current challenges, we still have good news and reasons to celebrate. After the successes of the events in 2019, we were recording steady improvements in trade and economic relations between both countries prior to the outbreak of Covid-19.

"The indicators include the increase in the number of Japanese companies in Nigeria from 32 in 2017 to 43 today," the embassy disclosed,

"As soon as the situation begins to normalise, we shall take steps to pursue Nigerian-Japan relations with vigour and resolute determination, through robust engagements in economic and trade activities.

"We shall continue to bolster the networks of trade and economic activities between relevant actors and stakeholders from both countries. We shall initiate, encourage and support new ideas to expand the scope of trade and economic activities between both countries."

The statement said the Japanese companies "are engaged in different sectors of the economy, including power generation, transmission and distribution, agriculture, machinery, automobile, manufacturing, engineering, electronics, infrastructure, food and seasoning, medical and healthcare.

The statement added that some of them manufacture products locally in their own plants in Nigeria.

He noted that another indicator was the increase in the volume of trade and economic activities between both countries.

"Recent statistics issued by competent government agencies from both countries attest to this positive trajectory.

"Although we have not been able to build substantially on the gains we garnered in 2019, the embassy is undeterred. We believe that Nigeria and Japan will overcome Covid-19 and come out of this challenging period stronger.

"Therefore, we look forward with great optimism to actualise the initiatives we have in the pipeline and consolidate on the achievements we recorded in 2019/20," the embassy said in its statement.-This Day.

Africa Union Tackles Non-Tariff Barriers

The African Union has amplified action to tackle non-tariff barriers and increase small businesses' use of the trade barriers' Africa, tool through its new online platform, according to Africa Union.

The African continent is about to become the world's largest free trade area. If not addressed, non-tariff barriers may slow down this effort. Although the negative impact of non-tariff barriers on intra-regional trade is recognized, so far there has been limited success in addressing them.

"The success of the Africa Continental Free Trade Agreement depends in part on how well governments can track and remove non-tariff barriers," said Ambassador Albert Muchanga, the African Union Commissioner for Trade and Industry. A new campaign to spotlight and remove non-tariff barriers in intra-continental trade launches.

The trade easier campaign aims to promote the uptake and use of the African Union's trade barriers Africa, a non-tariff barriers reporting mechanism tool.

The tool, developed by the African Union in partnership with United Nations Conference on Trade and Development, supports efforts to make continental trade easier and less costly by helping African businesses report such barriers and supporting their elimination with the help of governments.

Non-trade barriers slow down the movement of goods and costs importers and exporters billions of dollars annually. They also stand in the way of the success of the African Continental Free Trade Area. "If we want the Africa Continental Free Trade Agreement to thrive, we have to ensure operational barriers are dropped and businesses and traders, especially small ones; don't suffer from undue limitations placed on them as they try do the basic thing that makes economies work - trade."

Every day many African traders and businesses face barriers to trade. >From quotas to excessive import documents or unjustified packaging requirements, these barriers are a big hindrance to trade between African countries and make it complicated and expensive to move goods across the continent.

Regulatory and procedural barriers include customs operations and border documentation requirements, rules of origin documentation and pre-shipment inspections. Other trade barriers come in the form of transport regulations, sanitary and phytosanitary measures and technical barriers to trade.

The application of trade-related regulations to ensure consumer health, protect the environment and safeguard national security is legitimate, but disproportionate restrictions or cumbersome enforcement of trade regulations can stifle trade and amount to non-trade barriers and should therefore be addressed. The use of non-trade barriers for protectionism goes against the principles of African integration.

According to a United Nations Conference on Trade and Development report, if these barriers are removed, the African economy could gain 20 billion USD, much more than the 3.6 billion USD it could recover by eliminating tariffs. The United Nations Economic Commission for Africa estimates that the Africa Continental Free Trade Agreement has the potential to boost intra-African trade by 52.3 percent by eliminating import duties and could double trade if non-trade barriers are also reduced.

The trade barriers Africa platform focuses on identifying non-trade barriers and eliminating them. Trade related complaints that are reported can be monitored by government officials in each country and by the dedicated non-trade barriers coordination unit at the Africa Continental Free Trade Agreement Secretariat.

The non-tariff barrier coordination unit is responsible for verification of complaints. Once complaints are verified, officials in the countries concerned are tasked with addressing the issue within set timelines prescribed by the Africa Continental Free Trade Agreement.

The trade barriers Africa online tool also makes it possible for African businesses to play an active role in removing obstacles to continental trade by reporting non-tariff barriers online and having them resolved through the mechanism outlined in Annex 5 of the Africa Continental Free Trade Agreement's Protocol on Trade in Goods.

More than 600 reported barriers have been resolved through existing portals at the regional economic community level. The Africa Continental Free Trade Agreement- Non-tariff barriers online tool builds on these successful regional portals, helping the entire continent boost efforts to break down non-tariff barriers.

Micro, small and medium-sized enterprises, informal traders, youth and women business operators play a crucial role in African trade but are disproportionately impacted by non-tariff barriers due to their limited resources and access to information.

To raise awareness on the reporting mechanism among African micro, small and medium-sized enterprises, and encourage the micro, small and medium enterprises to use the platform, the trade easier webinar series has been organised and starts on 29 September 2020.

The virtual roadshow of discussions around the continent kicks off in East Africa, through Southern and Central Africa and ends in West Africa. It brings African businesses together to share their real-life experiences and accounts on non-tariff barriers to trade.

The webinar series also seeks their suggestions for trading easier across the continent, with a focus on how the trade barriers Africa platform can make a difference.

The trade easier campaign encourages African business people to visit the trade barriers Africa platform and make their trade challenges known to the authorities so that the challenges can be resolved.

"If micro, small and medium enterprises can more easily report barriers to trade to national and continental authorities and get them resolved, we are already closer to unlocking Africa's real trade potential and that of the Africa Continental Free Trade Agreement," the African Union's Dr. Oswald Chinyamakobvu said.-Ethiopian Herald.

Bank of Thailand Launches World's First Government Savings Bond on IBM Blockchain Technology

IBM (NYSE: IBM) today announced that Bank of Thailand (BOT), the central bank, has successfully launched the world's first blockchain-based platform for government savings bonds issuing a total of $1.6B USD within two weeks.

Leveraging blockchain technology on the highly secured IBM Cloud, the platform allows investors to benefit from speedy bond issuance, reducing a process that previously took 15 days to two days. The efficiency provided by blockchain also reduces operational complexity and the overall cost of issuing bonds.

According to The Thai Bond Market Association, the outstanding Thai bond market stood at $421B USD as of December 2019. Government bonds dominate the Thai market, with outstanding value of $157B USD in 2019 1, accounting for 37% of the total outstanding Thai bond market.

In the past, the sale of government savings bonds was a complex, multiparty, time-consuming process that relied on a non-real-time system, with duplicated validation steps and manual reconciliation prone to data errors.

As blockchain technology streamlines the processes of bond issuance for issuers, underwriters, registrars, investors and key ecosystem participants, the government savings bond platform now becomes an immutable, real-time single source of truth for network participants, which minimizes the redundant validation and reduces the costs of reconciliation. In addition, Thai investors can now purchase bonds up to the maximum value of their individual allocated quota from a single bank.

The effort to develop a secure and efficient government bond infrastructure involved collaboration among eight institutions including BOT, Public Debt Management Office, Thailand Securities Depository Co., Ltd, Thai Bond Market Association and selling-agent banks, including Bangkok Bank, Krungthai Bank, Kasikorn Bank, and Siam Commercial Bank, with IBM Blockchain as technology and cloud platform partner.

The benefits and business value of using blockchain technology for government bond distribution is shared across stakeholders, and include faster bond issuance for investors, decreased workloads and processing time for issuers, underwriters and registrars, as well as greater transparency and reduced operating costs across the entire value chain.

"Bank of Thailand's success with the government savings bond project is the latest example of how blockchain technology can redefine the way businesses operate by simplifying complex processes resulting in fast, transparent, secured and efficient multiparty collaboration," said Patama Chantaruck, VP for Indochina Expansion and MD of IBM Thailand. "IBM is proud to bring our world-class blockchain platform and IBM Cloud to support Bank of Thailand, and work side-by-side with them in achieving this important milestone for Thailand's financial industry."

Bank of Thailand now plans to extend blockchain to all other government bonds targeting both retail and wholesale investors.

Thailand is an active adopter of blockchain technology, with a dynamic ecosystem extending to both public and private spheres. In 2019, the electronic letter of guarantee (eLG) platform and network participated in by 22 Thai banks and 15 companies successfully went live and currently handles approximately $300M USD in guarantee letters. Thai Customs Department also became the second government agency in southeast Asia to use TradeLens, a blockchain-based global trade digitization platform that improves the speed, accuracy and security of local and international shipping activities. More pilots and applications of blockchain are also being rolled out to bring transparency and efficiency to finance, insurance, government and other sectors.-prnewswire

Vedanta's Profit Drops 23.5% As Virus Lockdown Hurts Output, Demand

Billionaire Anil Agarwal's commodities conglomerate Vedanta posted a 23.5 per cent drop in quarterly profit as one of the world's strictest lockdowns hit production and demand. Group net income slumped to ₹ 1,033 crore ($141 million) in the three months to June from ₹ 1351 crore a year earlier, the company said in a statement late Saturday. Sales fell 25.9 per cent to ₹ 15,687 crore.

Key Insights

Vedanta's main businesses include zinc, aluminum and oil and gas, all of which have been hit by a slump in demand due to the coronavirus pandemic

·         Agarwal's London-based Vedanta Resources is in the process of taking the Mumbai-listed Vedanta private by buying out minority shareholders to simplify his investments.

·         Vedanta Resources is in talks with banks for a further $600 million to finance the delisting after already securing $3.15 billion in loans and bonds, according to people familiar with the information.

·         Vedanta had net debt of ₹ 24,787 crore at the end of June.

·         Vedanta's Hindustan Zinc, also Asia's most valuable zinc producer, reported a 23 per cent drop in June-quarter profit on lower prices and production.

·         India's economy posted its worst slump in the three months ended June as disruptions caused by the Covid-19 outbreak brought Asia's third-largest economy to a halt. Economists expect growth to shrink in the year through March 2021, in the first such contraction in more than four decades.

Market Reaction

Shares of Vedanta rose 0.4 per cent on Thursday to close at ₹ 137.45 in Mumbai. The stock has slid 9.8 per cent this year compared with a 6.2 per cent fall in the BSE benchmark index.

Analysts have 11 buy recommendations on the company, 4 holds and 0 sells, according to data compiled by Bloomberg.-ndtv

Asian Tech Giant Snaps Up Avaloq

The Swiss banking software firm has found a buyer which values the company at $2.23 billion. The move follows a fallout with its private equity owner of three years. 

NEC Corporation is buying Avaloq in an acquisition which values the Zurich-based software firm at 2.05 billion Swiss francs ($2.26 billion) the Swiss firm said in a statement on Monday. The Japanese tech firm will operate Avaloq as its own entity based in Switzerland.

The deal means an exit for Warburg Pincus, which owns 45 percent, as well as for founder Francisco Fernandez, who owns 28 percent of Avaloq. The acquisition, which NEC and Avaloq expect to wrap within six months, means long-term stability for clients and employees, Avaloq said.

Since the private equity house took a major stake in 2017, Avaloq has sharpened strategy to shift into a more piecemeal software service model dubbed SaaS. The move has weighed on profitability, as has a high double-digit million cloud-based effort and a dividend to its shareholders in 2018.-finews

Asian markets rally after Trump signals optimism on coronavirus recovery

SEOUL — Stocks in Asia rallied on Monday, recouping some of last week's losses after President Trump declared he was on the road to recovery from the novel coronavirus.

Hong Kong’s Hang Seng Index was up 1.5 percent, after posting its biggest weekly decline in six months last week. Shares in Australia rose more than 2 percent, while the Nikkei in Japan was up about 1.2 percent.

The Shanghai and Shenzhen stock exchanges were closed on Monday for China’s National Day holiday, which continues through Oct. 8.

Markets across the world slumped on Friday as Trump, 74, and a growing number of his aides and high-profile supporters tested positive for the virus. The news added uncertainty to the prospects of the U.S. economic recovery, and called into question how much bandwidth the Trump administration would have for foreign policy in coming weeks.

Trump briefly leaves hospital to greet fans as confusion continues over his health

With the large number of senior U.S. officials who have been in recent proximity to Trump, it was also unclear whether more officials and politicians may test positive.

In Asia, there were fears that China or other nations might take the opportunity of confusion in Washington to make geopolitical moves, amid heightened tensions in the region.

“Markets do not like uncertainty,” said Khoon Goh, head of Asia research at ANZ. “The U.S. president testing positive this close to the election, it prompts investors to sell first and ask questions later.”

He said the markets recovered ground on Monday after it appeared Trump’s condition was not as bad as originally feared.

Other factors buoying Asia markets at the start of the week included upbeat economic data out of Taiwan and South Korea, and hopes that the U.S. fiscal stimulus package would be passed, he said.

In Australia, hopes of more stimulus expected to be revealed in this week’s national budget also added to investors’ optimism.

Meanwhile, information from the White House on Trump’s health status continued to be limited and contradictory on Sunday. Officials said Trump had suffered two bouts of low oxygen, but also said he was doing well and could soon be discharged from the hospital.

Trump briefly left the Walter Reed National Military Medical Center on Sunday in an SUV to wave to supporters.

Stocks fell across Asia last week amid concerns that the global economic recovery would be slower than expected.

U.S. index futures were higher in overnight trading, pointing to a likely rally when the U.S. stock markets open on Monday. On Friday, the Dow Jones industrial average shed 0.5 percent, while the Nasdaq fell 2.2 percent.-washingtonpost

Oil prices fall   

Crude oil prices took a nosedive last Friday after President Donald Trump tweeted late on Thursday that both he and the first lady had tested positive for Covid-19.

Brent crude slipped below $40 in Asian and European trading, and West Texas Intermediate stayed below $38 a barrel, after falling earlier this week.

Oil was already on the decline earlier this week, weighed down by renewed fears about demand recovery as new Covid-19 cases continued rising fast in Europe, the US, and India. The global total passed 34 million this week, up by a million from a week earlier. The death toll from the disease passed the 1-million mark this week as well.

In more bearish news, the US Congress continued failing to strike a bipartisan deal on further financial stimulus. The only development in this direction was the House approving a Democrat-proposed bill for an additional $2,2-trillion in stimulus that is likely to hit a wall in the Senate. — Oilprice.com.

Gold extends gains   

United Kingdom— Gold extended gains last Friday en route to its best week in nearly two months as investors sought safe-haven assets after US President Donald Trump tested positive for Covid-19.

Spot gold was up 0,5 percent at $1,915.34 per ounce by 0645 GMT, reversing losses from early Asian trade. US gold futures rose 0,3 percent to $1,922.20. Bullion has gained 2,9 percent so far in the week, heading for its biggest weekly percentage rise since the week ended August 7.

“The Trump Covid-19 diagnosis has caused an immediate spike in gold prices as investors rush to (safe-) haven positioning,” said Jeffrey Halley, a senior market analyst at OANDA.

“We expect risk-aversion will remain elevated . . . depending on how this situation evolves over the weekend, notably if more members of the US government’s senior leadership are diagnosed positive, gold could be set for an extended rally. — Reuters.

SA rand rally pauses   

The US dollar and South African rand pair rose by more than 0,25 percent today as traders digested news that Donald Trump had contracted coronavirus. The pair is trading at 16,6430, which is higher than yesterday’s low of 16,54.

In a statement earlier today, Donald Trump revealed that he had infected the Covid-19. Melania Trump, his wife, and Hope Hicks, a senior aide, have also tested positive.

As a result, experts believe that other senior administration officials have also contracted the illness. This announcement has sent shivers around the world, with most people worried about what will happen next. As a result, the US dollar, Japanese yen, Swiss franc, and gold have all risen while US and European equities have declined. That is because analysts consider the former assets to be safe havens.

Indeed, the dollar has risen across other developed world and emerging market currencies, including the South African rand.

Meanwhile, the dollar and South African rand pair is also waiting for the non-farm payrolls numbers that will come out later today. — news24.com.

Invest Wisely!

Bulls n Bears 

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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 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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