The Markets

LAGOS (Capital Markets in Africa) — Nigerian companies are poised to raise a record amount of local short-term debt, joining one of the biggest global junk-bond rallies in two months as businesses take advantage of a drop in borrowing costs. Companies including Dangote Cement Plc, Union Bank of Nigeria Plc and MTN Group Ltd. have tapped the domestic market this year to refinance existing debt or boost working capital. It comes as firms from casino operators and retailers to lenders…

HARARE (Capital Markets in Africa) — Zimbabwe’s central bank abandoned a currency peg it introduced in March and said it would allow the rate to be set by an auction system. The announcement represents a setback for Reserve Bank of Zimbabwe Governor John Mangudya, who unilaterally imposed the peg of 25 to the U.S. dollar against the advice of the bank’s Monetary Policy Committee, according to people familiar with the situation. The introduction of the…

JOHANNESBURG (Capital Markets in Africa) — South Africa must cut spending to avoid a sovereign debt crisis within the next four years, Finance Minister Tito Mboweni said. Mboweni is preparing to deliver a revised budget on June 24 that will reflect the devastation wrought on the economy by the coronavirus pandemic, he told lawmakers Thursday in Cape Town. The Treasury plans to make “very serious and unusual changes” to its expenditure plans, he said. “We…

LAGOS (Capital Markets in Africa) — Emerging-market stocks may be recovering, but cash-rich investors would be better off avoiding the risks that still abound in developing nations. Barclays Plc is telling its high net-worth clients in emerging markets to invest in U.S. equities instead, despite the S&P 500’s breakneck rally. Countries from India to Brazil and Russia have become the epicenter of the coronavirus pandemic, with their economies grinding to a halt and governments struggling to provide…

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…

JOHANNESBURG (Capital Markets in Africa) — South Africa’s antitrust-watchdog revived a five-year-old case against banks that were accused of manipulating trades in the rand-dollar currency-pair. The Competition Commission has compiled a new charge sheet against more than 20 lenders that allegedly colluded to fix prices and divide markets in the currency pair, mostly in New York, the regulator said in an email Tuesday. Nedbank Group, FirstRand Ltd.’s Rand Merchant Bank and Standard Bank Group’s Standard Americas Inc….

LAGOS (Capital Markets in Africa) — A debt-relief initiative for poor nations is losing momentum as credit premiums narrow and lenders balk at the complexities of a concerted halt in payments. Private creditors won’t rush to join a G-20 led the effort to ease debt burdens, while borrowers may also be wary of joining the plan as their economies heal after the coronavirus-led selloff, potentially improving market access for issuers. Defaults may still pick up…