The Markets

LAGOS (Capital Markets in Africa) – Banks rallied on Friday morning after Goldman Sachs said stocks were starting to appear attractive after a 41% sell-off, with investors accounting for lower interest rates and a much higher probability of recession. A “zero percent interest rates scenario appears fully priced in,” analyst Richard Ramsden wrote in a note upgrading Morgan Stanley to buy from neutral and U.S. Bancorp to neutral from sell. The market may now believe “low rates for a protracted period of time…

LAGOS (Capital Markets in Africa) – Emerging-market equities posted their worst daily decline since November 2008 as traders shunned all but the safest securities on concern U.S. measures to stem the gathering pace of the coronavirus outbreak aren’t robust enough. Currencies weakened and sovereign bond spreads widened. The MSCI Emerging Markets Index of equities fell 6.6% Stock benchmarks from Brazil to Poland and Thailand tumbled more than 10% A measure of currencies dropped by the most in almost four…

LAGOS (Capital Markets in Africa) – Oil’s rout may have been an unexpected boon for the biggest buyers of liquefied natural gas, but its knock-on effects may come back to bite. That’s because more than a dozen proposed LNG export projects from the U.S. to Mozambique are at risk of being delayed or scrapped as crude careened to levels that make most of them unprofitable. If fewer of them come to fruition, that would ease…

LAGOS (Capital Markets in Africa) – The Nigerian central bank denied it plans to devalue the naira soon, and announced an investigation to uncover currency dealers it blames for sparking a “panic” market sell-off this week. “Market fundamentals do not support naira devaluation at this time,” the bank said in a statement released late on Thursday by spokesman Isaac Okorafor. The global market turmoil sparked by the coronavirus contagion and this week’s collapse of oil prices…

JOHANNESBURG (Capital Markets in Africa) – A plan to support South Africa’s ailing sugar industry will include tapping into the biofuel potential of cane. Government, farmers and industrial users in the 14 billion rands ($924-million) industry are working on a strategy to stem a crisis caused by a flood of cheap imports and a tax on sugar-sweetened drinks that lowered the demand from beverage makers. President Cyril Ramaphosa said in his Feb. 13 state-of-the-nation address…

JOHANNESBURG (Capital Markets in Africa) – Sasol Ltd. said its setback-hit Louisiana chemical project should generate positive core earnings in the second half of the financial year. The South African chemicals and fuels producer reported a 73% drop in first-half earnings per share after oil prices in rand dropped, global chemical markets softened and the company suffered delays at its Lake Charles Chemicals Project. The U.S. plant negatively impacted earnings by 2.8 billion rand ($185…

ABIDJAN (Capital Markets in Africa) – The benchmark stock index in West Africa’s regional bourse, which has been in retreat since 2016, may get a boost if a flurry of elections in member countries pass off smoothly this year, according to a money manager. Four states affiliated with the Bourse Regionale des Valeurs Mobilieres: Togo, Burkina Faso, Niger and Ivory Coast, Francophone West Africa’s largest economy, go to the polls this year. Successful voting, combined…