Market Watch

LAGOS (Capital Markets in Africa) – The decline in equity volatility from its early August highs looks overdone given the number of risk events that lie ahead, according to market participants. Federal Reserve meeting minutes, Fed Chair Jerome Powell’s speech at Jackson Hole and a slew of economic data from purchasing managers indexes to jobless claims are among those seen to have the potential to re-ignite price swings. The Fed is seen as the most…

LAGOS (Capital Markets in Africa) – That’s the message EM investors can take on board as they weigh up U.S. rate reductions and next week’s G-20 meeting — and a dovish Fed should overcome trade fears. There are opposing forces at play. Donald Trump’s desire for lower interest rates — markets say there’s an 84% chance the Fed cuts by the end of July — is making EM traders giddy about a weaker dollar. But his penchant for trade…

LAGOS (Capital Markets in AfricaA) – Oil rose in New York, trading near a five-month high, after industry data indicated a sharp decline in American gasoline inventories last week. West Texas Intermediate crude futures increased 0.6 percent, while gasoline climbed as much as 1.5 percent to the highest since October. The American Petroleum Institute was said to report on Tuesday that gasoline stockpiles fell by 7.08 million barrels. That may change expectations for more comprehensive government…

LAGOS (Capital Markets in Africa) – Cobalt prices were surging so much last year that thieves were carrying out elaborate heists at warehouses in Europe’s busiest port. Now, prices are in free fall and mining companies are taking the financial hit. The story of what happened is the classic boom-bust in commodities. In the case of cobalt, it was Elon Musk’s vision of electric cars gaining mass appeal and an ensuing rush of money to…

JOHANNEBURG (Capital Markets in Africa) – Impala Platinum Holdings Ltd. is in the process of selecting potential buyers for one of the shafts it had planned to close in April as part of a restructuring plan for its Rustenburg mining complex. The world’s second-largest platinum producer is considering options including selling shafts or inviting contractors to run the operations. A selection process to identify and engage with possible takers for its number 1 shaft, which employs…

JOHANNESBURG (Capital Markets in Africa) – As risk aversion weighed on developing-nation bonds in October, one small corner of the market resisted: sub-investment-rated corporate debt in Africa. Emerging-market corporate bonds lost an average 0.7 percent this month, according to Bloomberg Barclays indexes. But dollar-denominated securities of companies in Ghana, Democratic Republic of Congo and Nigeria eked out gains, thanks to the relative isolation of those markets and the general scarcity of corporate debt in Africa. African…

JOHANNESBURG (Capital Markets in Africa) – South Africa’s yield curve has steepened to a record as investors protect themselves against a riskier fiscal outlook. The government said its finances were deteriorating last week, driving the premium on 20-year yields over two-year securities to more than 365 basis points on Wednesday, the most since Bloomberg started compiling the data in 2003. Longer-dated bonds will remain undervalued, according to Standard Bank Group Ltd. “While we still expect the yield…