| A recovery on global markets last week has fizzled out this week, with the JSE's All Share Index falling back below 50,000 following a 2% decline yesterday. The reality of a global recession as well as ongoing trade tensions between the US and China, exacerbated by Covid-19, is keeping investors on their toes. MTN led the decliners on the JSE, shedding close to 10% despite sticking to its medium-term forecasts. However, a first-quarter update outlined the increasingly tough conditions it faces due to capital flows and volatile exchange rates across the countries where it operates. Recent ratings downgrades in Nigeria and South Africa, its two biggest markets, will further dampen growth. The network operator has trimmed its capex budget for the year as well. Other companies are also taking measures to ensure they remain liquid due to the current uncertainty. Altron is paying a final dividend, but not as much as it would have in the absence of the coronavirus, and Long4Life is guarding its cash - although it says this positions it to take advantage of any opportunities that come along. For investors exposed to mining stocks what is happening in China is of crucial importance as the country accounts for approximately half of commodity consumption in the world. Ingham Analytics, in "Iron ore and steel defies Covid-19 macro gloom", examines latest data relevant to steel and iron ore, including freight rates, and how these drivers affect companies like BHP and Kumba (majority owned by Anglo American). The answer lies in the title of the note, but why is this so? Latest fair values on both stocks are provided and a suggested trading strategy. Also in your final newsletter for the week, Liberty expects a bumpy ride this year but says its capital cover remains strong. And Cape-focused property group Spear REIT has met its distribution guidance for the year but isn't hazarding a guess at what the period ahead holds. Also, all the latest mergers and acquisitions news from DealMakers. Finally, the SA Reserve Bank is a pillar of rectitude but following central bank examples from around the world may not always be best practice and have all sorts of distorting effects. In "Why do central banks do what they do?" top trader Andrew Kinsey sends a warning message that has implications for the local economy and financial markets. Have a good weekend and stay safe if you're venturing out. Stephen Gunnion Managing Editor, InceConnect
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