Major International Business Headlines Brief::: 03 May 2022

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Major International Business Headlines Brief::: 03 May 2022 

 


 

 


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ü  Amazon sell-off ends dismal month for US shares

ü  Asda chairman Stuart Rose: Food prices will keep rising

ü  Qantas promises direct flights from Sydney to London and New York

ü  EU accuses Apple of breaking competition law over contactless payments

ü  The perfect storm increasing the cost of a crucial metal

ü  Amazon will pay US staff travel expenses for abortions and other
treatments

ü  EU divided over how to step away from Russian energy

ü  Trader made error in 'flash crash', Citigroup says

ü  BP profits soar amid calls for a windfall tax

ü  Australia election: Interest rates rise for first time in decade

ü  Nigeria: Banks, Others' Borrowings From CBN Fell By 66 Percent to N1.4trn
in Four Months

ü  Nigeria: 20 Sub-Saharan African Countries in Debt Distress, High Risk of
Debt Distress - IMF

ü  Seychelles: The Tale of Lake Victoria's 'Saviour Fish'

ü  Nigeria: Inflation - Transport Fare in Q1 Highest in February

 

 

 

 

 

 

 

 

 

 

 

 


 <mailto:info at bulls.co.zw> 

 


 

 

Amazon sell-off ends dismal month for US shares

US markets ended April in a deep funk, as investors turned their backs on
once-favoured technology companies amid concerns about the economy.

 

A sell-off in Amazon shares, after the firm reported a fall in online sales,
helped drive the Nasdaq index down more than 4% on Friday.

 

April was the worst month for the tech-heavy index since the 2008 financial
crisis, with a 13% fall.

 

But the market downturn is not limited to tech stocks.

 

The wider S&P 500 logged it largest one-day decline since June 2020. It is
down almost 14% since the start of the year.

 

The Dow Jones Industrial Average fell 5% in April and has dropped about 9%
since January.

 

Markets - often considered a predictor of future economic health - have been
jittery as a economic threats have mounted.

 

Inflation is raging at a multi-decade high in the US and elsewhere, driven
by higher energy prices and the war in Ukraine.

 

Key supply chains have been affected both by the war, and by the on-going
impact of the Covid pandemic, especially in China where lockdowns are still
being used to limit the spread of the virus.

 

Apple has already warned that it expects a big hit to its business due to
disruption in China.

 

And Amazon, which profited from the pandemic boom in demand for home
deliveries, has found that effect is now beginning to fade.

 

On Friday Amazon shares dropped 14%, after it reported sliding online sales
and its first quarterly loss since 2015. Shares in smaller online shopping
site Etsy fell more than 8%.

 

"Market participants are nervous to begin with, so there is a quick trigger
when it comes to these names when there's any uncertainty," said Keith
Buchanan, senior portfolio manager at Globalt Investments in Atlanta.

 

"When assumptions about these companies' growth fail to materialize, then
there's definitely a 'shoot first and ask questions later' mentality."

 

While consumer spending - the main driver of the US economy - has held up so
far, there are growing worries that rising prices will make shoppers more
careful, and could prompt a slowdown.

 

Earlier this week, the US reported its economy contracted by 0.4% in the
first three months of the year. The European Union said Friday it had seen
just 0.2% growth in the first quarter.-BBC

 

 

 

Asda chairman Stuart Rose: Food prices will keep rising

Food prices will keep rising, and stay higher "for quite some time" due to
the high cost of raw materials, Asda chairman Lord Rose has said.

 

Many families struggling with the cost of living crisis are "going to
suffer", the Conservative peer warned - although retailers will try to keep
costs down.

 

The Bank of England expects price inflation to hit 8% this spring.

 

But Business Secretary Kwasi Kwarteng said inflation would not necessarily
be long term.

 

Families in the UK have been struggling as energy, fuel and food costs rise
rapidly.

 

Speaking to the BBC Sunday Morning programme, the Asda chairman said he
feared that food prices "are going to go higher, and they are going to stay
high for quite some time".

 

Pressures on prices include the war in Ukraine and a resurgence of Covid in
China, said Lord Rose.

 

Oil and gas prices were already rising rapidly before Russia's invasion of
Ukraine, but the war has pushed prices up further.

 

In turn, this is ramping up raw materials costs for manufacturers and
retailers - including for meats like chicken and staples such as pasta -
with the price hikes being passed on to consumers.

 

What is the UK's inflation rate and why is the cost of living going up?

"Chicken feed is going up, and all the other associated costs are going up,"
he said. "I see no quick solution to this.

 

"Pasta is made from durum wheat, and durum wheat has gone up in price, so
that's an inevitable cost increase."

 

Co-op chief executive Steve Murrells told the Sunday Times that chicken
could become as expensive as beef due to the war in Ukraine.

 

Fast food chain Nando's, which specialises in chicken, said that some of its
prices had gone up in April.

 

Lord Rose said retailers "will do what we can" to shield customers from raw
materials cost increases, but added they were "not immune from cost
increases ourselves" and would pass them on.

 

He said supermarkets have staff, electricity, fuel, insurance and transport
costs, alongside raw materials costs.

 

"If you're baking biscuits or baking cakes, [energy] goes into the cost of
the raw material that you have to pass on [to consumers]," he said. "What we
have to try and do is mitigate that."

 

There is a danger of long-term effects on the economy from high inflation
including "a wage spiral" and "stagflation" - where prices and wages go up,
but the economy doesn't grow.

 

"They are both evil, and the government has got a very difficult and tricky
road to navigate," Lord Rose said.

 

He added that 90% of Asda customers were "very worried about the cost of
living, and how they are going to make ends meet".

 

Business Secretary Mr Kwarteng said there was "obviously an issue with cost
of living increases", but "we don't know how long that will last".

 

"Who can say how long any inflation will last?" he said. "It's a global
issue, there's no doubt that every economy in the world is looking at the
high prices and greater inflation."

 

He the government was "dealing with it by creating jobs."

 

High inflation will not necessarily go on for years, Mr Kwarteng added, due
to the government's "energy security strategy", which includes new nuclear
and offshore wind power generation.

 

Energy prices: What is a windfall tax and how would it work?

Labour has repeated calls for a windfall tax on oil and gas companies to
subsidise energy bills.

 

Mr Kwarteng said he was against a windfall tax because it would discourage
investment, but he said Chancellor Rishi Sunak had not ruled it out.

 

Mr Sunak is "going to look at all options", Mr Kwarteng added.

 

Talking about Labour's windfall tax proposals, its leader Sir Keir Starmer
told Sky News: "We are not talking about taxing the profits they expected to
make. This is the profits they didn't expect to make.

 

"We would then use that to reduce energy bills by up to £600."

 

Labour's shadow foreign secretary David Lammy told the BBC that families
dealing with cost of living pressures should not have to face a rise in
National Insurance. The government has said this rise will help the NHS
recover from Covid and fund social care in England.

 

"It's absolutely the wrong time for people to face a National Insurance
rise," he said. "Let's be clear, we've had 15 tax rises over the last decade
from this Conservative government, at a time when four in 10 people are
buying less groceries."

 

National Insurance: What will tax changes cost me?

Liberal Democrat leader Sir Ed Davey said inflation would be high for "at
least a year or two".

 

"Millions of pensioners and families are really worried about the cost of
living," he said. "They're pretty annoyed that the Conservative government
seem to be making it worse with tax rises."

 

Scotland's First Minister Nicola Sturgeon said: "This week, as most people
received their pay packet, they finally see the reality of the Tory-made
cost of living crisis - a hike in National Insurance, soaring bills and no
support from Westminster."-BBC

 

 

 

Qantas promises direct flights from Sydney to London and New York

Qantas has announced it will begin operating non-stop flights from Sydney to
London and New York from 2025.

 

Australia's national carrier said it had purchased a new fleet of Airbus
A350-1000 jets capable of direct flights to any city in the world.

 

The first Sydney-London flights will depart in late 2025 and take about 20
hours, making them the world's longest passenger flights.

 

The route, launched in 1947, once took 58 hours and seven stops.

 

"It's the last frontier and the final fix for the tyranny of distance,"
chief executive Alan Joyce said in a statement.

 

Qantas has been working on the plan - dubbed Project Sunrise - for about
five years, but implementation has been delayed by the Covid-19 pandemic.

 

In 2018 it began offering direct 17-hour direct flights between London and
Perth in Western Australia, and in 2019 it conducted a series of test
flights from the east coast to the UK and New York.

 

The new fleet of 12 planes will begin arriving in 2025, with the order to be
completed by 2028.

 

The airline did not say how much it would charge for seats in its four
classes: first, business, premium economy and economy.

 

Each plane will be able to carry 238 passengers with 40% of the cabin
dedicated to premium seating. Seats will be roomier than usual, Qantas says.

 

Travellers will also be able to access a "wellbeing zone" in the centre of
the plane - with a self-service snack bar and space for stretching and
movement - to combat the effects of spending 20 hours in the air.

 

Paul Charles, a former Virgin Atlantic communications director, told BBC
News the success of the route relied on a cheaper price to attract
travellers - who would otherwise break their journey with a stop in the
Middle East.

 

Mr Charles, who now runs a travel consultancy, said: "It's fine if you're in
business class and at the front of the plane with more space, but if you're
flying economy most people will want to break their journey and it would be
a very tough 20-hour flight.

 

He predicted a price war over fares between Europe and Australia - as Middle
East airlines operating out of hubs like Dubai and Doha face down the threat
from Qantas and its direct service.

 

Qantas could also have a challenge on its hands to make the flight
comfortable and entertaining for passengers, Mr Charles added, as well as
ensuring their wellbeing.

 

Asked whether other airlines could follow Qantas' lead in launching
ultra-long haul flights, he said: "The question is in 2025 when this is due
to launch, what will the world look like?"

 

"Will we want to fly such long-haul routes or will consumers want to fly
short-haul on more environmentally friendly flights that are shorter in
duration?"

 

The experience of ultra-long haul flying can be "brutal on the body",
according to travel YouTuber Noel Philips.

 

Mr Philips has flown 18 hours on a non-stop Qatar Airways flight from
Auckland to Doha, and 16 hours on a non-stop Qantas flight from London to
Perth.

 

"The problem is you're sort of stuck in one position for such a long period
of time," he said.

 

"Especially with some of the older aircraft, there's the issue of
dehydration on the body as well, which can take it out of you.

 

"But the airlines are recognising these flights can be brutal on the body
and doing things to make it a bit easier.

 

"You were getting smoothies to help with your hydration... and the
entertainment Qantas had on their Perth route was really good."

 

He said he reckoned there would be "incredible demand" for the service due
to the family and business ties between the UK and Australia.

 

"If people can do a non-stop flight, I think people will prefer to do a
non-stop flight to Australia," he added.

 

"With a stopover somewhere it's just prolonging the whole experience and it
turns into a bit of a faff."

 

Currently Qantas operates non-stop flights between UK and Australia, with
Boeing 787s linking London's Heathrow Airport and the Northern Territory
city of Darwin.

 

The flight from Australia takes about 17 hours, and the return journey is
about 16 hours long.-BBC

 

 

 

EU accuses Apple of breaking competition law over contactless payments

The European Commission has accused Apple of abusing its market position for
contactless smartphone payments.

 

In a preliminary finding, it said the US company may have broken competition
law by preventing rivals from accessing its "tap and go" technology.

 

Apple denies the charge and has promised to engage with the Commission.

 

If the charges are upheld, it could be fined up to 10% of its global
turnover of $36.6bn (£29.2bn) based on its revenue last year.

 

"We have indications that Apple restricted third-party access to key
technology necessary to develop rival mobile wallet solutions on Apple's
devices," EU Vice-President Margrethe Vestager said in a statement.

 

"We preliminarily found that Apple may have restricted competition, to the
benefit of its own solution Apple Pay," the EU official who is in charge of
competition policy said.

 

 

Less innovation= less choice

According to the Commission, this behaviour from Apple has an "exclusionary
effect" on competitors and "leads to less innovation and less choice for
consumers for mobile wallets on iPhones".

 

In response, the tech giant said its payment system was only one of many
options available to European consumers.

 

It added that it had "ensured equal access" to mobile payment technology,
while "setting industry-leading standards" for privacy and security.

 

"We designed Apple Pay to provide an easy and secure way for users to
digitally present their existing payment cards and for banks and other
financial institutions to offer contactless payments for their customers,"
the company said in a statement.

 

"We will continue to engage with the Commission to ensure European consumers
have access to the payment option of their choice in a safe and secure
environment."

 

However, the EU antitrust regulators said their investigation had not found
"any evidence" that would point to a more open design posing a "higher
security risk".

 

"On the contrary, evidence on our file indicates that Apple's conduct cannot
be justified by security concerns," Ms Vestager said.

 

The Commission also accused Apple anti-competitive practices dating back to
2015 when it launched Apple Pay.

 

More than 2,500 banks in Europe use Apple Pay and Apple smartphones
represent around a third of the market across Europe. Next year, the EU
plans to implement new rules for technology firms, detailed in its Digital
Markets Act.

 

EU regulators also charged Apple last year, accusing the firm of distorting
competition in music streaming markets after rival company Spotify lodged a
complaint.-BBC

 

 

 

The perfect storm increasing the cost of a crucial metal

In the next few years, millions of people will buy electric vehicles (EVs).
All those cars and trucks will run on batteries containing metals such as
cobalt, lithium and nickel.

 

But shortages of metals could potentially hobble the EV boom.

 

"Not a lot of people realise, we simply do not have enough of these critical
materials at the moment mined around the world," says Megan O'Connor, chief
executive and co-founder of battery materials mining and recycling firm, Nth
Cycle.

 

Her company has designed a means of extracting nickel and other metals from
minced-up old batteries - so that these materials can be used again.

 

It's called electro-extraction and it works by using an electrical current
to separate metals out from crushed up battery waste known as "black mass".
The separated metals are isolated and trapped in a special filter.

 

Nth Cycle's technology extracts nickel, not just from pulverised old
batteries, but also from the clumps of rock and metals dug out of mines.

 

It's potentially a more sustainable method of recovering nickel than
traditional techniques such as pyrometallurgy, which Dr O'Connor says is not
an environmentally-friendly process.

 

"Think of it like a big furnace, they melt everything at very high
temperatures - you can imagine the carbon footprint," she explains.

 

In the coming years, industry will need all the supplies of nickel it can
get as its integral to so many of the products we use daily.

 

Lithium ion batteries, which power many devices, including your phone, rely
on a mix of nickel, manganese and cobalt.

 

But in some batteries, nickel is by far the largest component, representing
80% of the mix.

 

The problem is that sourcing nickel, like many materials at the moment, is
subject to supply chain headaches caused in part by the war in Ukraine, as
Russia is one of the world's biggest nickel suppliers.

 

Countries such as Indonesia and the Philippines, will likely boost their
nickel output as buyers search for non-Russian sources of the metal.
Although there are questions over how sustainable this new production will
be.

 

Dr O'Connor argues that new mines will not be able to open quickly enough to
satisfy rising demand for nickel, which is also used to make stainless steel
and wind turbine components. Instead, recycling old batteries will help to
"patch" that supply problem, she suggests.

 

Other companies are also taking this approach, with Redwood Materials in the
US already acquiring disused batteries from between 60-80,000 electric
vehicles every year.

 

"We recover, on average, 95% of the elements from batteries, like nickel,
cobalt, lithium and copper," says vice president for communications and
government relations, Alexis Georgeson.

 

But general confidence in the nickel market is yet to return after a
difficult episode in March, when nickel's price on the London Metal Exchange
(LME) spiked by 250% before falling again. That prompted the LME's operators
to suspend trading of nickel for about a week - a more or less unprecedented
move.

 

"It was a disaster," says Keith Wildie, head of trading at metals recycling
firm Romco Group, who notes that the price of nickel remains volatile.
Although it has fallen again, the price is still around 60% higher than it
was at the beginning of the year.

 

The price shock happened partly because a Chinese firm, Tsingshan Holding
Group, had built up a large "short position" in the market - in other words,
arranging contracts that bet the price of nickel would fall. When it didn't,
the firm was forced to buy back those contracts, or commit to supplying the
nickel. Taking either option would result in a huge loss.

 

The company did not respond to a BBC request for comment.

 

Disruption and panic on the market has subsequently knocked nickel traders'
confidence, adds Mr Wildie: "The volumes have absolutely collapsed."

 

Both the Financial Conduct Authority and the Bank of England have announced
reviews into the incident.

 

In a statement, the LME said, "The LME is committed to ensuring that the
actions of all participants
 are fully reviewed, and appropriate actions
taken to both restore confidence and support the long-term health and
efficiency of the market."

 

However, there were concerns about future supplies of nickel, even before
this episode unfolded.

 

EV maker Tesla, for example, had already moved to secure access to the metal
by becoming a technical partner in a new nickel mine on the Pacific island
of New Caledonia.

 

Not all firms can take this option. More than two-thirds of the world's
nickel production goes to the stainless steel industry, where it ultimately
ends up in everything from cutlery to bathroom taps and washing machines.

 

Some stainless steel factories in Europe have already cut production, thanks
to nickel pricing and supply concerns.

 

Although Lisa Reisman, founder and executive editor of trade publication
MetalMiner, predicts that short term demand for the metal in some industries
could fall.

 

High interest rates might lead to a slowdown of the housing market, which
would likely mean fewer people may purchasing new appliances containing
stainless steel in the coming months, she explains.

 

Electric cars will almost certainly require a steady supply of nickel,
though.

 

Earlier this year, market research firm S&P Global Platts forecasted that
light duty EV sales worldwide would reach 26.8 million by 2030. The firm
noted that EV sales more than doubled between 2020 and 2021.

 

Jason Sappor, senior analyst at S&P Global Platts, says the elevated price
of nickel probably won't have a major impact on EV sales. But he does say
that EV batteries are becoming an increasingly important driver of the
nickel market.

 

Could recycling old batteries help fill the gap, as Dr O'Connor suggests?
Maybe, says Mr Sappor - but it requires getting access to enough old
batteries to make extracting the small amounts of nickel inside them
worthwhile.

 

"The one issue with that is that there needs to be the existing stock to
recycle from," he says. This approach does make sense, he adds, "in the long
run".

 

Dr O'Connor stresses that recycling alone won't be enough to satisfy our
nickel needs in the foreseeable future: "We need to start mining more of
these materials - and mining them more sustainably."-BBC

 

 

 

Amazon will pay US staff travel expenses for abortions and other treatments

Amazon will reimburse staff in the US who travel for a wide range of
non-life threatening medical treatments including elective abortions.

 

A message to Amazon staff said that the firm will pay up to $4,000 (£3,201)
in travel expenses each year for treatments not available nearby.

 

Several other companies have announced plans that ensure staff have access
to abortions.

 

It comes amid rising restrictions for the procedure nationwide.

 

Amazon's new benefits are effective retroactively from 1 January.

 

According to the announcement, first reported by Reuters, the new benefits
will apply to treatments that are not available inside a 100-mile (161km)
radius of an employee's home and for which virtual options are not
available.

 

An Amazon spokesperson confirmed the benefit expansion to the BBC and said
it also includes bariatric care, oncology, congenital anomalies from within
24 months of birth, mental health treatments and in-patient substance abuse
disorder services.

 

Amazon is one of the biggest private sector employers in the US, with 1.1m
full and part-time workers in the country. It employs people nation-wide,
with most workers in California, Texas, and Washington state - home to its
global headquarters.

 

The benefits will be available to all employees enrolled in two different
health plans offered by the company, including those working in offices or
in warehouses.

 

The company also offers up to $10,000 (£8,002) for urgent, life-threatening
medical issues.

 

The ‘ranch’ for Texas mothers with no place to go

While the expansion of benefits by Amazon is not aimed specifically at
allowing access to abortions, it comes at a time when several Republican
state governments have passed laws restricting abortion access in their
jurisdictions.

 

Next month, the conservative-leaning Supreme Court will also rule on a case
that could overturn Roe v Wade, a 1973 court ruling that legalised abortion
in the US.

 

If the law is overturned, each US state could be permitted to determine its
own abortion rules, with more than 20 states expected to limit abortion care
or even ban abortions in most cases all together.

 

In Texas - which has one of the strictest abortion laws in the country and
bans the procedure after six weeks of a pregnancy - a recent study found
that some 1,400 Texans were traveling out of state for abortions monthly.

 

Companies including Yelp and Citigroup have recently said they will
reimburse employees who travel to circumvent local abortion restrictions.

 

Citigroup said the policy was "in response to changes in reproductive
healthcare laws in certain states".-BBC

 

 

 

EU divided over how to step away from Russian energy

European Union countries are split on how soon they wind down dependence on
Russian energy supplies.

 

While sanctions have been applied to other areas of business, the EU remains
heavily reliant on Russian oil and gas.

 

Germany's economic minister said the country would be able to weather a
Russian oil ban by the end of 2022, as he appeared to back tougher
sanctions.

 

However, Hungary has said it opposes such a move, stating it would not back
measures that could endanger supplies.

 

EU ministers met on Monday to discuss how to manage the situation, under
intense pressure to reduce the revenue stream supporting President Vladimir
Putin's war in Ukraine.

 

There are two main challenges faced by members states - how to pay for
Russian energy in a way which doesn't breach or undermine EU sanctions, and
also how to source and develop alternative supplies to move away from
reliance on Russia.

 

Europe's reliance on Russian energy

At a press conference on Monday, the EU's energy policy chief Kadri Simson
said Russia halting gas supplies to Poland and Bulgaria had strengthened the
bloc's will to become independent of Russian fossil fuels.

 

But according to the Centre of Research on Energy and Clean Air (CREA), the
EU has imported about £37bn worth of fossil fuels since the conflict began.
The two largest importers worldwide were Germany followed by Italy.

 

Energy giant Gazprom stopped gas exports to Poland and Bulgaria last week
after those countries refused to comply with Russian demands to switch to
payment in roubles, and many other member countries are set to face the same
issue around mid-May.

 

Poland and Bulgaria had planned to stop using Russian gas this year and say
they can cope with the stoppage, but it has raised fears that other EU
countries, including Europe's gas-reliant economic powerhouse Germany, could
be next.

 

Ms Simson repeated the European Commission's view on Monday that paying for
gas in roubles would be a "violation" of sanctions and "cannot be accepted."

 

She said member states were building up gas storage supplies before winter.

 

Nathan Piper, head of oil and gas research at Investec, told the BBC it was
"pretty clear" that the EU wanted to "pivot away" from Russian oil and gas,
but added the lack of unity was being caused by the "ability to actually
make that happen".

 

Europe gets about 40% of its natural gas from Russia, which is also the
bloc's main oil supplier, but some countries are more dependent Russian
fossil fuels than others, so sudden supply cuts could have huge economic
impact.

 

For example, Germany currently gets about 25% of its oil and 40% of its gas
from Russia, Slovakia and Hungary received 96% and 58% respectively of their
oil imports from Russia last year, according to the International Energy
Agency.

 

Germany's economic minister Robert Habeck said his country had "managed to
reach a situation where Germany is able to bear an oil embargo" and was "on
course to do the same for gas".

 

"Other countries need a bit more time," he added.

 

Diplomatic sources told the BBC that compromises to a complete bloc ban were
being looked at, particularly for countries such as Hungary and Slovakia.

 

'Finding new oil suppliers easier than gas'

Mr Piper said with oil, there were more options to get alternative supplies,
compared to gas, which is transported most commonly through pipelines.

 

He added it is also "trickier" for landlocked EU states to find new sources.

 

He also warned while Germany might move to ban oil, switching off its
Russian gas - which makes up 40% of its total imports - would "take them
years".

 

"Russia could go 'if you want to go after our oil, how about we reduce our
gas'," he added.

 

"They could push up the price, reduce the volumes. They have a lot of
bargaining power."

 

Elsewhere, energy research institute EWI said Germany should limit gas use
now to prepare for the possibility of a future cut-off from Russia.

 

Uniper, one of Germany's biggest energy firms, also warned an EU ban on
Russian oil could prompt Russia to halt westward gas flows.

 

Roubles row causing confusion

The company said last week it would pay in euros which will be converted
into roubles, meeting the Kremlin's demand for all transactions to be made
in the Russian currency.

 

"We consider a payment conversion compliant with sanctions law and the
Russian decree to be possible," a spokesman told the BBC.

 

Other European energy firms are reportedly preparing to do the same amid
concerns about supply cuts.

 

In late March, Russia said "unfriendly countries" would have to start paying
for its oil and gas in roubles to prop up its currency after Western allies
froze billions of dollars it held in foreign currencies overseas.

 

Under the decree, European importers must pay euros or dollars into an
account at Gazprombank, the Swiss-based trading arm of Gazprom, and then
convert this into roubles in a second account in Russia.

 

Who's paying for Russian gas in roubles?

The majority - 97% - of EU companies' gas supply contracts with Gazprom
stipulate payment in euros or dollars.

 

Some countries are looking to turn to liquified natural gas (LNG), with the
US agreeing to ship an additional 15 billion cubic metres to Europe by the
end of the year.

 

The US has already banned Russian oil imports and the UK plans to phase them
out by the end of the year.

 

The EU has previously laid out a strategy to make it independent of Russian
fossil fuels by 2030, which includes greater use of greener sources of
power.-BBC

 

 

 

Trader made error in 'flash crash', Citigroup says

US banking giant Citigroup has said that one of its traders made an error in
the so-called stock market "flash crash" in Europe on Monday.

 

A flash crash is an extremely fast fall in the price of one or more assets,
often caused by a trading mistake.

 

Trading was briefly halted in several markets after major share indexes
plunged just before 8am GMT on Monday.

 

Nordic stocks were hit the hardest, while other European indexes also
plummeted for a short time.

 

"This morning one of our traders made an error when inputting a transaction.
Within minutes, we identified the error and corrected it," the New
York-based bank said in a statement late on Monday.

 

The flash crash caused European shares to fall suddenly on a day when
trading was particularly thin due to public holidays around the world.

 

Sweden's benchmark Stockholm OMX 30 share index was one of the hardest hit,
falling by 8% at one point, before recovering most of those losses to end
the day 1.87% lower.

 

Flash crashes can be caused by human error, or so-called "fat finger" trades
- a reference to someone incorrectly typing the details of a trade.

 

Such trading errors and the flash crashes they can cause are often costly.
They have triggered shake ups of stock market rules and have even led to
criminal convictions.

 

In August 2012, a computer-trading glitch at US financial services firm
Knight Capital caused a major stock market disruption, costing the company
around $440m.

 

A flash crash on the Singapore Exchange in October 2013 saw some stocks lose
up to 87% of their value and resulted in new regulations being put in place
to avoid a repeat of the incident.

 

In 2020, UK-based former stock market trader Navinder Sarao was sentenced to
a year of home detention for helping trigger a brief $1tn US stock market
crash 10 years earlier.

 

Using specially programmed, high-speed software, Sarao placed thousands of
orders that he did not intend to fulfil, creating the illusion of market
demand. When he cancelled or changed his bids, he was able to profit.

 

The activity - known as "spoofing" - contributed to market instability that
led to the May 2010 "flash crash", when the Dow Jones index fell almost
1,000 points in a matter of minutes.

 

The US made spoofing a crime in 2010 as part of a broader effort to tighten
regulations following the 2008 financial crisis.-BBC

 

 

 

BP profits soar amid calls for a windfall tax

BP's profits for the first three months of this year have more than doubled
after oil and gas prices soared.

 

The oil giant reported an underlying profit of $6.2bn (£4.9bn) compared to
$2.6bn in the same period last year - ahead of expectations.

 

BP said the increase was due in part to "exceptional oil and gas trading".

 

Rising profits have prompted calls for a one-off windfall tax on energy
companies to help UK households grappling with rising household bills.

 

Energy prices: What is a windfall tax and how would it work?

Labour has previously said it was "only fair and right" that energy firms
making higher profits should pay more tax.

 

Chancellor Rishi Sunak has said he wouldexplore a policy if the companies
did not invest enough in the UK's energy supply. On Tuesday, BP announced
plans to invest £18bn in UK energy by the end of 2030.

 

BP also outlined that it had taken a $24.4bn hit on its decision to exit its
shareholding in Russian energy giant Rosneft following the Kremlin's assault
on Ukraine.

 

Including the cost of exiting its 19.75% shareholding in Rosneft, BP
reported a loss of $20.3bn for the first quarter.

 

"In a quarter dominated by the tragic events in Ukraine and volatility in
energy markets, BP's focus has been on supplying the reliable energy our
customers need," said BP's chief executive Bernard Looney.-BBC

 

 

 

Australia election: Interest rates rise for first time in decade

Australia's central bank has raised the nation's interest rates for the
first time in more than a decade.

 

The rise will put extra strain on household budgets as Australia prepares
for an election that is heavily focused on the rising cost of living.

 

The Reserve Bank of Australia (RBA) lifted the cash rate to 0.35% on
Tuesday.

 

The move is designed to combat rising inflation, which is at a 21-year high.

 

RBA Governor Philip Lowe said although inflation had picked up more quickly
than expected, unemployment was low and there was evidence wage growth would
improve.

 

It was time to withdraw "some of the extraordinary monetary support that was
put in place to help the Australian economy during the pandemic", he said in
a statement.

 

Although the economic outlook for Australia remains positive, Mr Lowe said
said further rises in interest rates were imminent.

 

The last time rates rose during an election campaign was in 2007, when it
was widely seen to negatively impact John Howard before he lost government.

 

Prime Minister Scott Morrison dismissed suggestions the decision would
impact his chances of re-election on 21 May.

 

"It's not about politics," he said. "It's not about me."

 

Labor said the hike showed a "full-blown cost of living crisis" had
developed on Mr Morrison's watch.

 

For someone paying off a A$600,000 (£340,000; $426,000) mortgage - which is
roughly average for an owner-occupier in Australia - the increase will be
about A$80 per month.

 

This is the last thing Scott Morrison needs less than three weeks before the
election.

 

It is another financial curveball after last week's news that Australia hit
a 21-year inflation rate high of 5.1%.

 

Remember, the government's campaign rests on how well the economy has been
faring - how robustly it recovered after Covid.

 

But this picture is changing quickly and painfully for Australians and for
the government.

 

For days the prime minister has been at pains to explain that the RBA's
decision has nothing to do with his government's handling of the economy.

 

He blamed "the extraordinary global environment" of Covid lockdowns in China
and of course the war in Ukraine.

 

He stood in front of cameras holding a chart comparing the rate of inflation
in Australia to other developed nations to prove how better off the country
was.

 

But those struggling to pay rent and keep on top of their household bills
will likely see a leadership not taking responsibility.

 

This may be a gift to the opposition's campaign, but whoever ends up winning
on 21 May will face an anxious population reeling from high costs of living
and wages that have failed to measure up.-BBC

 

 

 

Nigeria: Banks, Others' Borrowings From CBN Fell By 66 Percent to N1.4trn in
Four Months

Deposit money banks (DMBs and merchant banks borrowing from the Central Bank
of Nigeria's (CBN) Standing Lending Facility (SLF) dropped year-on-year
(YoY) by 66 per cent to N1.49 trillion in first four months of 2022, from
N4.44 trillion in the comparable period of 2021.

 

Financial institutions in Nigeria through the SLF borrow funds from the apex
bank to meet their financial intermediation role.

 

The apex bank lends money to banks and merchant banks through the SLF at an
interest rate of 100 basis points (bpts) above the Monetary Policy Rate
(MPR) of 11.50 per cent.

 

The trend between January and April 2022, as gathered from the CBN website
revealed steady decline in bank and merchant banks' borrowings, driven by
improvement in the level of liquidity in the interbank system.

However, analysts have said the development was due to low rates on savings
instruments, matured T-bills and bonds have not rolled over, resulting to
more currency in circulation.

 

An analysis of the CBN financial data revealed that banks and other
financial institutions in January 2022, borrowed N313.48 billion, which was
a decline of 25.5 per cent from N426.7 billion borrowed in January 2021.

 

In February, the total amount borrowed by banks and merchant banks dropped
further by 70 per cent to N186.48 billion from N621.7 billion in February
2021.

 

The trend continued in March 2022, as the CBN data revealed that N377
billion was borrowed by banks and merchant banks compared to N904.68 billion
in March 2021. Also, the amount borrowed by banks and merchants' banks in
April 2022 stood at N612.43 billion, a 75.4 per cent decline from N2.48
trillion reported by the CBN in April 2021.

Finance experts attributed the development to improved business environment
post Covid-19, stressing that this paved the way for banks and merchant
banks to halt borrowing from the CBN this year.

 

In a chat with THISDAY, the Head, Financial Institutions' Ratings Agusto &
Co, Mr. Ayokunle Olubunmi said: "There are presently low rates, and remember
that before 2019, T-bills were actually high and a lot of those instruments
are maturing now, so there is money in circulation. And this has been the
trend over the last couple of months."

 

He, however predicted that the CBN might soon put out measures to curb
excess liquidity in circulation.

 

"Once CBN feels the amount of liquidity in circulation is too much, they
have different instruments they can use to mop it up. Also remember that as
electioneering starts there would be more money in circulation and CBN can
get more aggressive," he added.

 

On his part, the Vice President, Highcap Securities Limited, Mr. David
Adnori said uncertainty in the nation's economy forced banks and merchant
banks to shun borrowing from CBN.

 

According to him: "Banks and merchant banks have excess liquidity and might
not need to borrow from CBN. Besides, economic uncertainty has started to
surface following the 2023 general elections."

 

In his reaction, analysts at PAC Holdings, Mr. Wole Adeyeye maintained that
banks and merchant banks in first four months of 2021, borrowed enough funds
from the CBN to meet their daily obligations.

 

He stressed that the nation's economy in 2021, had normalised, giving room
for banks and merchant banks to reduce borrowing from the CBN in 2022.

 

Adeyeye explained that banks and merchant banks are maintaining effective
risk management in a move to cut down down non-performing Loan (NPL) in the
financial sector.

 

He added that: "Banks and merchant banks with increasing deposit from
customers prefer to lend to CBN rather than their customers to maintain NPL
below five per cent threshold demanded by CBN."-This Day.

 

 

 

Nigeria: 20 Sub-Saharan African Countries in Debt Distress, High Risk of
Debt Distress - IMF

The International Monetary Fund (IMF) has warned that debt vulnerabilities
remains elevated in Sub-Saharan Africa, with no fewer than 20 countries in
the region either at high risk of debt distress or already in debt distress.

 

The Head of the Regional Studies Division in the African Department of IMF,
Papa N'Diaye who disclosed this in a new podcast released by the
multilateral lender, said debt burden in the region was very heavy at a time
when the social and development needs are very large.

 

Unsustainable debt could lead to debt distress, where a country is unable to
fulfill its financial obligations and resorts to debt restructuring.

Although the IMF chief did not list the 20 African countries in debt
distress or high risk of debt distress, the most recently published data
indicated that eight countries in the world were in debt distress, 30 at
high risk, 24 at moderate risk, and seven countries at low risk of debt
distress.

 

African countries in high risk of debt distress were listed then as Burundi,
Cabo Verde, Cameroon, Central African Republic, Comoros, Djibouti, Ethiopia,
The Gambia, Ghana, Guinea Bissau, Kenya, Malawi, Sierra Leone, Zambia,

 

Of the eight countries in debt distress globally, all but Grenada are from
Africa. They include Chad, Congo Republic, Mozambique, Somalia, South Sudan,
Sudan and Zimbabwe.

 

The IMF official said the debt service as a ratio to revenue has been
increasing, adding that the debt burden is very heavy at a time when the
social and development needs are very large.

Despite its N39.556 trillion ($95.77 billion) public debt profile as at
December 31, 2021, and over 80 per cent debt service-to-revenue ratio,
Nigeria is neither classified as a nation in debt distress nor high risk of
debt distress.

 

N'Diaye said: "So for countries in the region, the space to deal with the
impact of the war in Ukraine is very limited, and there will be a need to
make difficult choices. First, for us, the priority is really for countries
to help the most vulnerable populations mainly through targeted transfers,
if possible, especially those countries that have good social safety nets.

 

"Those that don't have those safety nets could resort to food subsidies and
tax cuts. But these will definitely need to be contained both in scope and
in time, given the limited fiscal space that countries have."

 

He stressed that Sub-Saharan African countries would need to try to create
more room by improving domestic revenue mobilisation, a s well as making
sure that they get the best bang for their bucks by increasing the
efficiency of public spending.

 

According to him, "Sub-Saharan African economies were growing very strongly
in 2021. We were expecting the region's average growth to come out at around
3.7 per cent for 2021. It turned out to be 4.5 per cent. And most of that
positive surprise, or that momentum, started in the second half of the year.

 

"But what the war in Ukraine has done, is to put a halt on that momentum. It
led to a significant increase in commodity prices, more volatility in global
financial markets."

 

He said inflation pressures have increased quite a lot, adding: "We are now
seeing inflation in double digits for the region as a whole over, I think,
11.5 per cent within 2021. We are expecting it, if you look at the period
average, to go towards 12.25 percentage points.

 

"And this is the first time since 2009 that we have this double- digit
projection for inflation. And it reflects mainly higher food prices and
higher energy prices.

 

"And as you can imagine, this will have a big impact on the most vulnerable
in the region, increase poverty and potentially could raise social tensions.
So for the policy makers in the region, like central bankers in particular,
dealing with this inflation and pressure won't be easy because of the...
also the impact that the policies could have on growth."-This Day.

 

 

 

Seychelles: The Tale of Lake Victoria's 'Saviour Fish'

On an island in Lake Victoria, Tanzania, fishermen are barely eking out a
living, where a crisis due to a combination of factors, including climate
change and overfishing, has changed the fabric of the community. Journalist
Mark Weston spent two years living on Ukerewe Island and wrote The Saviour
Fish, a very personal account of their situation.

 

The island was the hub of a fishing boom centered around Nile perch, an
invasive species of fish introduced by former colonial power, Britain.
Weston discusses in the book how this one move turned from boom to bust,
creating an environmental disaster after other fish species were eliminated,
allowing waterborne diseases to thrive.

 

Weston becomes friends with a number of illegal fishermen and is invited to
fish with them-- an honour to be invited to go-- where he describes
firsthand their quest to find a decent catch away from the government
patrols on the lake, but also observes the destructive impact of using large
drag nets.

 

Mixing travel writing with environmental reportage, Weston's The Saviour
Fish illustrates the fishermen's plight, but also the beauty of day-to-day
life, with love, loss, and curious children.

 

He spoke to RFI's Laura Angela Bagnetto.-RFI website.

 

 

 

Nigeria: Inflation - Transport Fare in Q1 Highest in February

The average price Nigerians pay for transportation in 2022 skyrocketed in
February, reports by the National Bureau of Statistics (NBS) have shown.

 

The rise could be attributed to the scarcity of petroleum products in the
month which led to a hike in the prices of commodities and transportation
fares.

 

The report documented bus journeys within cities, intercity and state route
charges per person; airfare charges for specified routes single journey and
journey by motorcycle (Okada) per drop; and waterway passenger transport.

NBS stated that there was a moderate rise in transport fares in January, but
the figure increased substantially in February, and dropped slightly in
March. However, when the figures are compared to the previous year, there
was an average of 25 per cent addition to transport fares.

 

The report stated that there was a moderate increase in January as commuters
had to pay an average increase of 0.26 per cent airfare for a single route
from N38,253.35 in December, 2021 to N38,352.19 in January, 2022. But on a
year-on-year basis, the fare rose by 5.18 per cent from N36,463.65 in
January, 2021 to N38,352.19 in January, 2022.

 

Also, bus journeys for intercity stood at N2,801 in January, 2022, an
increase of 0.59 per cent month-on-month when compared to the value of
N2,784 in December, 2021. But there was a 19.39 per cent year-on-year
increase from N2,346.41 in January, 2021 to N2,801.34 in January, 2022.

Similarly, the average fare paid by commuters for bus journeys within the
city per drop increased by 1.18 per cent; month-on-month from N470.83 in
December, 2021 to N476.39 in January, 2022. While a journey by motorcycle
per drop increased by 2.58 per cent month-on-month from N332.37 in December,
2021 to N340.94 in January, 2022. The fare paid for water transport in
January, 2022, stood at N888.24; showing an increase of 0.77.

 

For February, the air fare increased by 16.88 per cent on a month-on-month
basis from N38,352.19 in January, 2022 to N44,825.04 in February. On a
year-on-year basis, it increased by 22.95 per cent (N36,458.11) in February,
2021.

 

Intercity transportation stood at N3,106.72 in February, 2022, an increase
of 10.90 per cent on from the N2,801 in January. While it rose by 30.93 per
cent (N2,372.87) year-on-year in February, 2021.

 

Bus journey within the city per drop increased by 5.00 per cent on a
month-on-month from N476.39 in January, 2022 to N500.20 in February, 2022.
But commuters had to pay a 38.44 per cent from N361.31 in February, 2021 to
N500.20 in February, 2022.

 

For motorcycle per drop, there was an increase of 11.20 per cent
month-on-month from N340.94 in January to N379.12 in February, 2022. While
it rose by 42.13 per cent from N266.74 in February, 2021 to N379.12 in
February, 2022. Water transport also increased to N913, a 2.80 per cent
month-on-month but 15.0 per cent from N794.02 in February, 2021 to N913.13
in February, 2022.

 

In March, air fare increased by 4.43 per cent month-on-month from N44,825.04
in February, 2022 to N 46,810.62 in March, 2022. On a year-on-year basis,
the fare rose by 28.26 per cent (N36,495.41) in March, 2021.

 

The average fare paid by commuters for bus journey intercity per drop rose
to N3,270.94 in March, 2022, indicating an increase of 5.29 per cent on a
month-on-month compared to the value of N3,106.72 in February, 2022. The
fare, however, rose by 35.65 per cent (N2,411.29) year-on-year in March,
2021.

 

Similarly, the average fare paid by commuters for bus journeys within the
city per drop increased by 4.41 per cent on a month-on-month from N513.72 in
February, 2022 to N536.35 in March, 2022. In terms of year-on-year, however,
the average fare paid by commuters for bus journeys within the city per drop
rose by 42.17 per cent from N 377.27 in March, 2021 to N536.35 in March,
2022.-Daily Trust.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


 


 


Invest Wisely!

Bulls n Bears 

 

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INVESTORS DIARY 2022

 


Company

Event

Venue

Date & Time

 


 

 

 

 

 


 

 

 

 

 


 

 

 

 

 


 

 

 

 

 


 

 

 

 

 


Companies under Cautionary

 

 

 


 

 

 

 


ART

PPC

 

 


Starafrica

Fidelity

Turnall

 


Medtech

Zimre

Nampak Zimbabwe

 


 

 

 

 


 <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.

 


 

 


(c) 2022 Web: <http://www.bullszimbabwe.com>  www.bullszimbabwe.com Email:
<mailto:info at bulls.co.zw> info at bulls.co.zw Tel: +263 4 2927658 Cell: +263 77
344 1674

 


 

 

 

 

 

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