Bulls n Bears Daily Market Commentary : 24 December 2020

Thu Dec 24 18:00:13 CAT 2020

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Bulls n Bears Daily Market Commentary : 24 December 2020

 <http://www.zb.co.zw/> 

ZSE commentary

The market closed the day gaining 0.55% to close today at a total market capitalization of ZW$267.9 billion. The main stream All Share Index added 1.28% to close the day at 2243.43, the Medium Cap Index was up 2.13% to 4573.78 while the Top 10 Index was up 0.83% to 1438.2. Headlining the riser’s pack was the tobacco giant BAT  which went up 19.79%, followed by Seed Co which was up 16.09%, while Ariston added 7.52%, Edgars was up 6.67% and the retail giant OK Zimbabwe  added 5.34% to close at 783.69c. Significant losses were noted in Fidelity which shaded 10.53%, Star Africa  went down by 4.04%.

Elsewhere, losses for the day were also recorded in the heavyweights CBZ (0.89%), Masimba (0.58%) and Simbisa (0.10%) to close at 1000c. Total turnover was at ZW$92 133 821.71 in 347 trades. CBZ led the turnover contribution at ZW$50 002 800. Among the counters that participated in trading, 6 counters declined against 17 that appreciated. Total trades were 374 with 7 counters remaining unchanged and 21 with zero volume. wealthaccess

Global Currencies & Equity Markets

South Africa

Rand flat as local virus resurgence offsets global optimism

In early trade the rand was at R14.60 against the US dollar, trading 0.02% stronger.

The rand was little changed in early trade on Thursday, as improving global market sentiment was offset by a quickly worsening fresh coronavirus wave at home.

At 0727, the rand was at R14.60 against the US dollar, trading 0.02% stronger than its previous close in thin trading ahead of holidays.

Asian stock markets, however, were buoyed by optimism around a trade deal between Britain and the European Union, pushing investors to place bets on the prospects of a global recovery.

While positive global sentiment usually drives even riskier assets like the rand higher, investors also had to weigh two local pandemic-related announcements made late Wednesday.

The health ministry reported the highest-ever daily increase in coronavirus cases, and warned that South Africa’s second wave was progressing much faster and would surpass the peak of its first wave within days. It would consider fresh restrictions, the ministry said.

Britain also joined a number of other nations in imposing travel restrictions on the country, after it found two cases of another new variant of the coronavirus linked to South Africa.

Numerous countries had already enforced travel bans on Britain after it identified a separate new variant, also thought to be more infectious than those currently circulating, in the country.

Government bonds were flat, with the yield on the instrument due in 2030 at 8.755%

 <mailto:info at bulls.co.zw> 

Global Markets

ON THE UP Pound soars against the dollar and euro as UK signs historic Brexit deal

THE pound has risen today against the US dollar and euro afters the UK and the EU sign a historic Brexit trade deal.

The pound was up by two cents versus the US dollar at just over $1.36 at around on Thursday ahead of an announcement, and climbed a cent versus the euro to just above €1.11.

It had dropped slightly to $1.35 and €1.11 as an expected address from the Prime Minister was pushed back from this morning.

The FTSE 100 also finished up for the day as trading stopped early at 12:30pm ahead of the Christmas break.

It rose by 0.3% shortly after 8am - up 3% on the start of the week - but the gains fell to 0.1% this afternoon.

It came as:

There was an eleventh hour row about protections for the UK car industry - which appeared to have been resolved

Pizza was delivered to the Berlaymont HQ in Brussels late last night as crunch talks continued

The pound soared against the dollar last night on hopes of a deal

Already Brexiteers were grumbling about not having enough time to analyse the deal when it comes back to MPs

Sir Keir Starmer is preparing to urge his shadow cabinet to back a Brexit trade deal - and could hold a meeting later today to get their backing

Sterling was pummelled earlier this week as countries around the world imposed travel bans against the UK over fears a mutant strain of coronavirus.

Imposing tougher Covid restrictions on London and parts of the South East of England over the weekend also played a part.

On Monday, sterling plummeted to $1.32 against the US dollar and €1.08 against the euro after Christmas was cancelled for millions.

On December 17, the pound peaked at $1.35 and €1.11.

MUG strategist Lee Hardman, said yesterday: "The market is anticipating that a deal will be agreed in the next day or two," adding that sterling could strengthen to $1.36/$1.37, Sky News reports.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Oil climbs as U.S. inventory draw, Brexit deal hopes boost risk appetite

(Reuters) - Oil climbed for a second day on Thursday in light holiday trade as a drawdown in U.S. stockpiles of crude and gasoline raised demand hopes, while hints of an imminent Brexit deal raised investors' risk appetite.

Brent crude LCOc1 futures rose 38 cents, or 0.7%, to $51.58 a barrel by 0530 GMT, while U.S. West Texas Intermediate (WTI) crude CLc1 futures increased 31 cents, or 0.6%, to $48.43.

Both contracts gained more than 2% on Wednesday.

U.S. crude inventories USOILC=ECI fell by 562,000 barrels in the week to Dec. 18 to 499.5 million barrels, the Energy Information Administration said on Wednesday.

Gasoline stocks USOILG=ECI fell by a surprise 1.1 million barrels to 237.8 million barrels, the EIA said, while distillate stockpiles USOILD=ECI fell by a more-than-expected 2.3 million barrels to 148.9 million barrels.

Oil prices also drew support from news that Britain and the European Union were on the cusp of striking a narrow trade deal on Thursday, swerving away from a chaotic finale to the Brexit split.

The potential deal boosted sterling GBP=D3, which was up 0.2% against the dollar after closing up 0.9%. A softer dollar makes commodities priced in the greenback more affordable for holders of other currencies. FRX/

At least four drugmakers expect their COVID-19 vaccines will be effective against the new fast-spreading variant of the virus that is raging in Britain and are performing tests that should provide confirmation in a few weeks.

Still, some investors remain jittery about the recovery of oil demand as Americans were warned again not to travel for Christmas as the latest surge in cases overwhelmed hospitals.

On the supply side, U.S. energy firms this week added oil and natural gas rigs for a fifth week in a row.

The oil and gas rig count, an early indicator of future output, rose 2 to 348 in the week to Dec. 23, energy services firm Baker Hughes Co BKR.N said.

INVESTORS DIARY 2020

Company

Event

Venue

Date & Time

Christmas Day

25/12/2020

Boxing Day

26/12/2020

New Year’s Day

01/01/2021

Counters trading under cautionary

ART

Seed co Int.

Dairibord

Starafrica

Medtech

Turnall

Seed co

Invest Wisely!

Bulls n Bears 

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DISCLAIMER: This report has been prepared by Bulls ‘n Bears, a division of Faith Capital (Pvt) Ltd for general information purposes only and does not constitute an offer to sell or the solicitation of an offer to buy or subscribe for any securities. The information contained in this report has been compiled from sources believed to be reliable, but no representation or warranty is made or guarantee given as to its accuracy or completeness. All opinions expressed and recommendations made are subject to change without notice. Securities or financial instruments mentioned herein may not be suitable for all investors. Securities of emerging and mid-size growth companies typically involve a higher degree of risk and more volatility than the securities of more established companies. Neither Faith Capital nor any other member of Bulls ‘n Bears nor any other person, accepts any liability whatsoever for any loss howsoever arising from any use of this report or its contents or otherwise arising in connection therewith. Recipients of this report shall be solely responsible for making their own independent investigation into the business, financial condition and future prospects of any companies referred to in this report. Other  Indices quoted herein are for guideline purposes only and sourced from third parties.

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