The Editorial Team |

Fed to Stay Full Throttle With Credit Support Despite Debt Rally

NEW YORK (Capital Markets in Africa) — The Federal Reserve may have stoked one of the strongest corporate debt market rallies in decades, but it’s too soon to declare an all-clear for credit with the economy facing a potentially rocky road ahead. Sure, U.S. investment-grade borrowing costs have retreated to near all-time lows, and companies have sold $1 trillion of bonds at the fastest pace on record — evidence that merely announcing a plan to pump liquidity…

Big Pharma Looks Beyond Covid With AstraZeneca Eyeing Gilead

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NEW YORK (Capital Markets in Africa) — Two drugmakers behind the industry’s most prominent responses to the Covid-19 pandemic are looking into the possibility of a combined future as economies emerge from lockdowns. AstraZeneca Plc, co-developer of one of the fastest-moving experimental coronavirus vaccines, has made a preliminary approach to Gilead Sciences Inc., maker of the only U.S.-approved treatment, according to people familiar with the matter. If they decided to pursue a merger, it would be…

Egypt Forms Multi-Donor Platform to Help Boost Economy

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CAIRO (Capital Markets in Africa) — Egypt has formed a multi-donor platform to help boost the North African nation’s economy, Minister of International Cooperation Rania Al Mashat said. The program “includes electricity, transportation, the health sector,” Al Mashatsaid in an interview with Bloomberg TV on Monday. The platform received help and support “through the sovereign, but also through the private sector, through credit lines, through Egyptian banks that are availed through the EBRD and the EIB,”…

Good and Bad News for Nigeria’s Economy Last Week

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LAGOS (Capital Markets in Africa) — Africa’s largest economy had a week of good and bad news as the oil price rebounded to the highest level in two months, while the negative impact of the coronavirus pandemic on consumers and business activity became clearer. Crude prices have doubled since hitting a two-decade low in April, climbing past $40 a barrel after OPEC+ cuts started taking excess supplies from the market. With oil bringing in 90%…

Ninety One Raising Fund for Virus-Hit South African Firms

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JOHANNESBURG (Capital Markets in Africa) — Ninety One Plc is raising a recovery fund to invest in South African companies struggling with the economic fallout from the spread of coronavirus. The firm is targeting 10 billion rand ($595 million) and will market the fund to institutional investors in South Africa, according to a statement from the firm. The Ninety One SA Recovery Fund will invest in public and private equity as well as debt, with…

Africa Has to Weather Covid Trauma Without Massive Stimulus

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LAGOS (Capital Markets in Africa) — For advanced economies dealing with economic disruptions from the coronavirus pandemic, the response of choice has been massive stimulus packages. Africa is doing without them. While central banks and governments in North America, Asia and Europe have offered trillions of dollars to prop up businesses hit by lockdowns and provide a safety net for the swelling ranks of the unemployed, a lack of liquidity restricts African governments from providing…

South African Banks at Risk of Deepest Profit Slump in 50 Years

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JOHANNESBURG (Capital Markets in Africa) — South African banks face the steepest earnings slump in half a century — with some posting losses — as measures to curb the coronavirus drag the economy deeper into recession and lead to a surge in bad debts. “I have looked at each and every crisis in the last fifty-odd years and there is nothing this severe,” said Corné Conradie, an actuary and partner at auditing and consultancy firm…

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