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Investors “Sell in May and Go Away” as risk aversion intensifies; Oil collapses

Dollar loses might, oil crumbles on surging US stockpiles and gold flickers back to life in this week’s ecponomic review.

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Investors “Sell in May and Go Away” as risk aversion intensifies; Oil collapses

Stock markets across the globe have been treated without mercy this week as fears over prolonged US-China trade tensions weighed on market sentiment over global economic growth and stability.

The gut-wrenching sell-off witnessed this month suggests that markets are adapting to the reality that US-China trade tensions are here to stay, especially following both sides ramping up their rhetoric on trade tensions throughout.

It is becoming evident that global equity markets are facing the perfect storm of headwinds in the form of persistent US-China trade drama, concerns over plateauing global growth and tumbling commodity prices. For as long as these themes remain in play, investor appetite for stocks is poised to evaporate – ultimately bringing equity bears back into the game.

Asian stocks flashed red on Friday morning. This followed a painful session on Wall Street overnight. European shares are at threat of trading lower this morning and will likely be further at risk to volatility depending on the newsflow coming out of the European elections.

Dollar not so mighty after US data disappoints

Investors “Sell in May and Go Away” as risk aversion intensifies; Oil collapses

Investors who were looking for an appropriate opportunity to attack the Dollar were given the thumbs up yesterday after official reports showed that the IHS Markit US manufacturing PMI hit a 9-year low this month.

Rising concerns over the prolonged US-China trade disputes negatively impacting the US economy are at threat of playing a leading role in the sudden USD selloff.

Markets still expecting the Federal Reserve to cut US interest rates later this year, highlighting that the unexpected Dollar upside in 2019 risks running on borrowed time.

While the perception that the US remains in a far better condition than everyone else could continue supporting the Greenback, and a sudden spell of bad data would threaten this sentiment falling over like a house of cards.

Oil crumbles on surging US stockpiles; trade tensions weigh

West Africa Crude -Angolan June sales affected

There are few doubts that yesterday should unofficially be declared as the seller’s market for Oil prices after the commodity tumbled more than 5%, the steepest drop for Oil in 2019.

The dangerous combination of surging US crude inventories, weak demand from refineries and rising concerns over US-China trade tensions impacting economic health is creating a recipe for disaster in Oil markets.

It must be kept in mind that concerns over supply shocks following the resumption of economic sanctions on Iran could only push Oil prices to a certain level and this has been baked into the market months ago.

Commodity spotlight – Gold

Gold flickered back to life yesterday as ongoing US-China trade tensions and Brexit drama accelerated the flight to safety. A depreciating Dollar supported upside gains with prices punching back above the stubborn $1280 resistance level.

With speculation in the air of the Fed cutting interest rates this year and persistent concerns over slowing global growth weighing on risk sentiment, Gold’s medium to longer-term outlook remains tilted to the upside.

Taking a look at the technical picture, bulls seem to be back in the driving seat after prices pushed back above $1280. The daily close above this point is likely to signal a move higher towards $1300.

The views expressed in this piece are the author’s own and do not necessarily reflect News Central TV’s editorial stance.

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Journalists’ association condemns police threats in Somali

Police at a checkpoint near the site of Saturday’s bombing in Mogadishu, which killed eight people

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somalia journalists bash police

A Somali journalists’ association Sunday slammed the actions of police who it said threatened to shoot reporters trying to access the scene of a car bombing near parliament and warned of a “worsening situation” for the country’s press.

Police at a checkpoint near the site of Saturday’s bombing in Mogadishu, which killed eight people and was claimed by the Al-Shabaab jihadist group, stopped a group of reporters from international newsgroups.

“When the journalists tried to explain to the police about their reporting mission, a police officer fired two bullets (in the) air and then pointed his rifle on Jama Nur’s head, according to Jama Nur Ahmed and two other colleagues,” the Somali Journalists Syndicate (SJS) said in a statement.

Also in the group were journalists from Reuters, AFP and Turkey’s Anadolu news agency, followed by a second wave of reporters who were similarly denied access.

“The journalists said the police officers told them they had orders restricting journalist coverage at the scenes of attacks and threatened that any journalist who tries to film will either be shot dead or his/her equipment will be broken resulting (in) the journalists to return back from the scene,” said the SJS.

It charged Somali police treat journalists “like criminals”, preventing them from doing their work of reporting on events in the country. “This is a symptom of a worsening situation against journalists in Somalia”.

It said that on May 14 police confiscated reporters’ equipment, detained a cameraman, and beat up two others trying to report on another Mogadishu explosion.  

AFP has documented several incidents in recent months of journalists being intimidated and threatened and their equipment seized while trying to report on Shabaab attacks.

The SJS called on the Ministry of Information, the commissioner of police and the office of the prime minister to open an investigation, “and take appropriate steps against those responsible.”

“We call the highest offices of the government including that of the Office of the Prime Minister to intervene in order to for the journalists to report freely and accurately without fear,” said the statement.

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Gabon appoints popular environmentalist, ‘Mr. Green’ as new forestry minister

Lee White, who has lived in Gabon for three decades and is a citizen, takes over one of the most sensitive jobs in the country.

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Gabon appoints popular environmentalist, 'Mr. Green' as new forestry minister
Newly appointed Gabon Minister of Water and Forests, British Lee White was, before his appointment, the head of Gabon's National Parcs (Agence Nationale des Parcs Nationaux, ANPN). -(AFP)

Here’s your new job: You have to protect the country’s precious tropical forests. You have to stop illegal logging and fight the entrenched corruption backed by powerful forces which goes with it. By the way, you are a committed environmentalist — and you are foreign-born.

This is the challenge facing Lee White, a green activist born in Britain, who this week was named minister of water and forests in Gabon.

Related: Gabon vows no mercy over $250 million hardwood theft

White, who has lived in Gabon for three decades and is a citizen, takes over one of the most sensitive jobs in the country.

Long-running tensions between logging and conservation have been sharpened by corruption and falling revenues from oil, Gabon’s main money-earner.

“My appointment was a surprise for many people here,” White admitted in an interview with reporters after President Ali Bongo Odimba appointed him on Monday.

He said Bongo had asked him to “put an end to bad practices… (as well as) the corruption in the ministry”.

Related: Mystery in Gabon: Illegal haul of sacred wood disappears

White acknowledged the scale of the tasks ahead.

“We have to sustainably manage the Gabonese forest to improve the living environment of the Gabonese people, to stabilise its natural treasures and to preserve our ecosystems,” he said.

Almost 80 per cent of Gabon is covered by forests.

The forestry sector is a historic pillar of the economy, accounting for 17,000 jobs and 60 per cent of output excluding oil.

About a quarter of Gabon’s population live in rural areas, and many people depend on the forests for food and livelihood.

At the same time, the forests themselves are a treasure trove of biodiversity, much of it rare or endangered. 

Gabon appoints popular environmentalist, 'Mr. Green' as new forestry minister
Tropical forest exploitation, Gabon. Biosphoto / Jean-Francois Noblet

Related: Gabon threatens crackdown over theft of sacred wood

They are a haven for great apes, forest elephants and the black panther, as well as rare species of trees, some of them giants towering up to 60 metres (200 feet) high.

Manchester-born –

White, 53, was born in the northwestern English city of Manchester but grew up in Uganda — in a biography he recalls fighting at school with the son of former dictator Idi Amin.

In 1989, he arrived in Gabon, where he studied for a doctorate in zoology.

He took up Gabonese nationality in 2008 and the following year took over as head of the National Parks Agency (ANPN), a massive conservation project of 13 wildlife zones set up by the late president Omar Bongo, the incumbent’s father.

He was decorated by Queen Elizabeth II in 2010 for his dedication to nature conservation in Central Africa.

Lee’s high-profile defence of the rainforest and wildlife — often with the verdant Raponda Walker Arboretum near Libreville as a backdrop — made him a familiar face in the national media, which dubbed him “Monsieur Vert” (“Mister Green”).

Bongo turned to him for the job after firing the last forestry minister over a timber-smuggling scandal.

Related: Gabon’s president sacks vice president and forestry minister

Analysts say the job will require remarkable skills, juggling tact and principles, as well as rock-solid support from the top.

“This appointment can only be good news for protectors of the environment in Gabon,” said Gaspard Abitsi, director of a US-based NGO, the Wildlife Conservation Society (WCS), in Gabon.

“He is perfectly familiar with the challenges of conservation on a national and international level.”

Graft –

Others are more cautious about the prospects of reform.

“There are enormous management problems at the ANPN, and this agency only accounts for 10 per cent of the land,” said Marc Ona, president of an NGO called the Brainforest Association and a member of the opposition.

“From now on, Lee White will have to manage all of the forests in Gabon… If he hasn’t succeeded at the ANPN, why would he succeed with the whole expanse of the territory?” 

“The problem,” said Ona, “is not which individual heads the ministry but the whole forestry system, which is corrupt.”

In a report issued in March, a British NGO, the Environmental Investigation Agency (EIA) pointed the finger at a Chinese group, Dejia, which has wide-spreading logging interest in the Congo Basin.

Gabon appoints popular environmentalist, 'Mr. Green' as new forestry minister

It accused the firm of exceeding its logging quotas and spinning a web of patronage extending to ministers as well as the opposition.

The then forestry minister, Guy Bertrand Mapangou, initially lashed the report as biased and “inquisitorial” and seeking to “discredit” the country.

But within weeks, the government suspended Dejia’s licence at two logging sites.

Related: Gabon recovers 200 containers of rare hardwood, 153 still missing

On May 21, it fired Mapangou and Vice President, Pierre Claver Maganga Moussavou over the so-called “kevazingogate” scandal.

In February and March, authorities had seized nearly 5,000 cubic meters (176,000 cubic feet) of banned kevazingo wood — the equivalent of about 150 large container-loads, valued at around $8 million (seven million euros).

The contraband timber was found at storage sites belonging to Chinese companies at Libreville’s Owendo port — some of it disguised in containers bearing the stamp of the forestry ministry.

Related: 30 containers of kevazingo seized in Gabon

Kevazingo, also known as bubinga, takes many years to mature. Logging the wood is illegal in Gabon, but the temptation to flout the ban is huge. In Asia, kevazingo can fetch up to $2,000 per cubic metre.

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Gabon’s president orders PM to form a new government

Ali Bongo last month sacked his vice president and forestry minister following a scandal over the smuggling of precious timber.

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Ali Bongo
Gabonese President Ali Bongo Ondimba flanked by his wife Sylvia, leaves the airport helped by a stick upon his arrival in Libreville

Gabonese President Ali Bongo Ondimba, in his first televised speech since he returned to the country after a long absence due to a stroke, on Saturday called on his prime minister to form a new government.

He called for a smaller government, capable of being “exemplary, honest and ethical”.

Ali Bongo last month sacked his vice president and forestry minister following a scandal over the smuggling of precious timber.

The recorded speech came more than two months after his return to the country after a five-month absence in Morocco, where he was recovering from a stroke.

And it came as the country marked the 10th anniversary of the death of his father, Omar Bongo Ondimba, who ruled the country before him for 41 years.

Television pictures showed Ali Bongo, his wife and senior politicians at a mass in his memory in the presidential palace on the seafront of the capital Libreville.

Saturday’s speech was the first speech by the president since before his stroke.

But apart from a few words spoken on his return to the country in late March, he has said nothing in public since.

During his extended absence, the army quashed a brief attempted coup.

When he did return, on March 23, some opposition politicians called for a judicial enquiry into his state of health to determine if he was still capable of leading the country.

Ali Bongo took office after an election in 2009 that followed the death of his father.

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