Story of the Day
As the current quarter (Q3 2022) comes to an end, the next 30 days will see financial institutions (banks and non-banks) aggregate their financial results as per requirement from the central bank. The public will then be given a glimpse of who was “hot” and who was “not” in topping the earnings charts. It has become an unwritten tradition, especially for the banker’s side, to dissect the financial statements of contemporaries. The ‘Covid era’ amplified this as Zambia’s banking space created the most value in many a year for incumbent players. Read more
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They say amidst every turbulence, silverlinings do exist. Despite a chaotic global environment characterized by excessive inflation, soft commodity price dislocations and monetary policy tightening whose effects extend to emerging markets, one darling safe haven hotspot market that continues to reflect resilience in asset performance is Zambia. Africa’s second largest copper producer and first bond defaulter in the COVID19 pandemic era is defying the odds by reflecting robust growth in its investment market. This stellar performance and resilience is second to none. Read more: The Business Telegraph
Standard Chartered Bank Zambia has recorded a 25% drop in profits following a corresponding decrease in top line revenue. A drop in top line revenue is perhaps the most worrying trend as it indicates loss of business. The earnings per share for the six-month period ended 30 June 2022 is K0.10 compared to earnings per share of K0.13 for the six-month period ended 30 June 2021. Read more: Zambian Business Times
The government has signed the Namibia-Zambia Memorandum of Understanding (MoU) on cooperation in facilitating the private sector development and implementation of the Namibia – Zambia multi-product petroleum and gas pipeline which is expected to supply 100,000 to 120,000 barrels per day of refined petroleum products in Namibia and Zambia. Minister of Energy, Peter Kapala said the Zambian and Namibian governments have reached a mutual agreement on the contents of the MoU which has the priority focus on enhancing economic cooperation between the two countries in the petroleum sub-sector. Read more: Lusaka Times
ACTIONAID Zambia says the increase in PAYE threshold from K4,500 to K4,800 still leaves workers in a worse-off position given the high cost of living and prevailing average earnings. And ActionAid says government should urgently address the challenges which contribute to the low absorption capacity of CDF to enable 100 percent absorption. Read more: News Diggers
International Business and Finance
Porsche took pole position as Europe’s most valuable automaker on Thursday, overtaking former parent Volkswagen as the price of the sportscar maker’s newly-listed shares sped higher. Although Porsche shares fell below their listing price on Monday to 81 euros, in line with a wider fall in markets, they had risen to 93 euros ($91.95) on Thursday morning, giving the sportscar brand a market valuation of 85 billion euros ($84 billion). The rise pushes Porsche’s valuation beyond Volkswagen’s 77.7 billion euros ($76.6 billion). Mercedes-Benz comes in third among European carmakers, followed by BMW and Stellantis. Read more: CNN
The global economic outlook is darkening and the risks of recession are quickly rising: That’s the latest message from the International Monetary Fund, which said Thursday it will once again lower its growth projections. “We estimate that countries accounting for about one-third of the world economy will experience at least two consecutive quarters of contraction this or next year,” said IMF managing director Kristalina Georgieva during a speech at Georgetown University. “And, even when growth is positive, it will feel like a recession because of shrinking real incomes and rising prices.” The IMF anticipates that the world could lose $4 trillion in economic output between now and 2026. “This is the size of the German economy — a massive setback for the world economy,” she said. After global growth hit a 6.1% annualized rate in October 2021 amid a strong recovery from the pandemic, estimates have since been regularly downgraded by the IMF. The global financial institution now anticipates growth to total 3.2% this year and 2.9% next year. Read more: CNN
Technology giant Samsung has warned of a 32% slide in its profits as demand for electronic devices and the memory chips that power them shrinks due to the global economic slowdown. The South Korean company estimates its quarterly operating profit was about 10.8tn won ($7.6bn). Read more: BBC News
The aftermath of the mini-budget could have seen a £50bn fire sale of UK government bonds by funds connected to the pensions industry, the Bank of England has said. There was risk of a downward “spiral”, it said, as increases in the cost of government borrowing hit the funds. The Bank feared these funds would be forced to sell their government debt holdings, adding to the market turmoil. Read more: BBC News
The UK has opened a new licensing round for companies to explore for oil and gas in the North Sea. Nearly 900 locations are being offered for exploration, with as many as 100 licences set to be awarded. The decision is at odds with international climate scientists who say fossil fuel projects should be closed down, not expanded. They say there can be no new projects if there is to be a chance of keeping global temperature rises under 1.5C. Both the Intergovernmental Panel on Climate Change (IPCC), the global body for climate science and the International Energy Agency (IEA) have expressed such a view. Read more: BBC News
Fuel prices in Ethiopia rose by about 20% on Thursday (September 29), less than three months after a previous 30-40% hike, as part of the phasing out of government subsidies for petroleum products. Faced with soaring crude oil prices this year, which are widening the state’s deficit, the Ethiopian government decided to phase out all fuel subsidies in July. Read more: Africa News
In the latest round of cyberattacks, Binance, the world’s largest cryptocurrency exchange, was hacked, and around $100 million of Binance Coin was stolen. Business Insider
Zanzibar plans to execute a feat of ingenuity as it architects plans for the world’s tallest green tower. Named the Burj Zanzibar, Leander Moons, a Dutch-born architect drafted the idea to construct a skyscraper made with hybrid-timber technology. This plan was unveiled to the public in Muscat, Oman on 1 October 2022. Read more: Business Insider
The White House angrily pushed back at OPEC+ after the oil producer group announced its largest supply cut since 2020, lashing out at what President Joe Biden’s administration described as a “shortsighted” decision. Energy analysts believe the deep production cuts could yet backfire for OPEC kingpin and U.S. ally Saudi Arabia, particularly as Biden hinted Congress would soon seek to rein in the Middle East-dominated group’s influence over energy prices. OPEC and non-OPEC allies, a group often referred to as OPEC+, agreed on Wednesday to reduce oil production by 2 million barrels per day from November. The move is designed to spur a recovery in crude prices, which had fallen to roughly $80 a barrel from more than $120 in early June. Read more: CNBC
Capital Markets Report
In 110 trades recorded yesterday, 99,332 shares were transacted resulting in a turnover of K379,443. Trading activity was recorded in Airtel, Bata, Standard Chartered Zambia, Zambia Sugar and CEC Africa on the quoted tier. The LuSE All Share Index (LASI) maintained its close at 7,229.31 points, as there were no share price movements. The market closed on a capitalization of K72,399,557,541 including Shoprite Holdings and K37,616,872,101 excluding Shoprite Holdings.