Bulls n Bears Daily Market Commentary : 05 November 2020

Thu Nov 5 17:16:48 CAT 2020

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Bulls n Bears Daily Market Commentary : 05 November 2020

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ZSE commentary

AFDIS and Innscor lead ZSE gains.

The market rebounded in Thursday's session as the primary All Share Index
gained 0.38% to close at 1,502.72pts while, the Industrial Index put on
0.65% to 4,958.71pts. The Top Ten Index ticked up 0.75% to end pegged at
973.67pts. Spirits and wines manufacturer Afdis topped the gainers' pack on
a 11.77% jump to $19.0001 while, conglomerate Innscor added 7.32% to settle
at $20.9641 reversing previous day losses. Retailers OKZIM extended 6.50% to
$4.7922 while, Star Africa grew 5.26% to $0.2000. Apparel retailer Edgars
completed the top five winners of the day after advancing 4.44% to $0.9400.
The Mining Index succumbed 7.30% to end at 3,400.14pts weighed down by
Bindura which trimmed 8.91% to $3.4613. Banking group NMB shed 5.08% to
$2.7000 while, Axia retreated 2.52% to $3.8485. Construction group Masimba
let go 1.92% to $2.5500 as Ariston capped the top five shakers of the day on
a 1.54% loss to $1.2800.

Fallers outnumbered gainers by a count of three to leave the market with a
negative breadth. Turnover ballooned 186.33% to $90.04m while, volume of
shares traded rose 30.17% to 8.28m. Top volume drivers of the day were
Econet and Delta which accounted for a combined 71.28%. Top value drivers of
the day were Delta, Afdis and Econet with respective contributions of
47.48%, 17.14% and 13.33% to the aggregate. Foreign buys jumped 114.51% to
$4.21m while, sales expanded 576.83% to $69.70m as the market closed with a
net funds outflow position. efesecurities

Global Currencies & Equity Markets

Kenyan, Tanzanian shillings to be stable, Zambia kwacha to ease

The Kenyan, Ugandan and Tanzanian shillings are expected to hold steady
against the dollar in the week to next Thursday, traders said.

(Reuters) - The Kenyan, Ugandan and Tanzanian shillings are expected to hold
steady against the dollar in the week to next Thursday, traders said.

KENYA

The Kenyan shilling is expected to trade flat over the coming days amid slow
trade, traders said.

Commercial banks quoted the shilling at 108.75/95, compared to last
Thursday's close of 108.85/109.05.

UGANDA

The Ugandan shilling is expected to stay in a tight range in the coming days
as some players in the interbank market unwind positions in the face of
subdued demand for hard currency.

Commercial banks quoted the shilling at 3,735/3,745, unchanged from last
Thursday's close.

TANZANIA

Tanzania's shilling is expected to hold steady next week as importer dollar
demand matches the inflows from agricultural exports.

Commercial banks quoted the local currency at 2,314/2,324 on Thursday from
an average of 2,313/23 recorded a week earlier.

ZAMBIA

The kwacha is likely to remain under pressure due to sustained dollar demand
to service debt and pay for farm inputs and oil imports.

On Thursday, commercial banks quoted the currency of Africa's second-largest
copper producer at 20.5500 per dollar from a close of 20.5340 a week ago.

 <mailto:info at bulls.co.zw> 

Global News

Dollar Begins To Depreciate As Biden Advanced Toward White House

In the United States, Biden is close to winning the presidential election,
and the US dollar is at a two-year low against other Asian currencies,
including the Yuan.

Financial markets are in turmoil as incumbent Republican President Donald
Trump hints at legal action in several states, accusing them of rigging and
vote-rigging.

Experts and traders say the situation could temporarily weaken the dollar
and affect its performance.

On the other hand, the Pound and Euro have depreciated against the Dollar as
media reports suggest that the Bank of England has begun to consider
negative interest rates.

The policy is likely to be maintained by the Federal Reserve as traders and
economists closely monitor the situation and the value of the Mexican yuan
against the dollar has risen sharply in this nerve-wracking presidential
election.

Biden claimed victory in Wisconsin and Michigan, while the former vice
president reportedly has the upper hand in Nevada and Arizona, but Trump has
the upper hand in Georgia and Pennsylvania.

The Biden administration is expected to pursue soft trade policies that will
reduce the value of the dollar against other world currencies, which under
the Trump administration faced tariff risks.

Masumi Yamamoto, the chief currency strategist at Tokyo's Mizuho Securities,
said the rise in the value of the yuan and peso against the dollar suggests
that the market is reacting to Biden's victory, for a number of other
reasons, against the dollar. You can also see the value of the Euro rises.

As Democratic party's Joe Biden witnesses a clear victory ahead of US...

The yuan hit a two-year high of  $6.6381, with Biden's victory likely to
boost China's currency in the trade market.

Emerging market currencies such as the Malaysian ringgit and the Indonesian
rupiah have also appreciated against the dollar.

The euro traded at 17 1.1736 on Thursday but fell 0.25 cents to 29 1.2960.

If Biden succeeds in overcoming the legal challenge posed by his rival Trump
to become president, Republicans will likely seize control of the Senate and
use it to thwart Biden's agenda. This is another complex aspect for currency
traders.

Some analysts say Republican control of the Senate will prevent the Biden
administration from raising corporate taxes, which is a positive thing for
equities.

However, he said that a divided government could have major financial
implications and could be viewed negatively.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold Markets Continue Range Bound Trading

Gold markets have been very tight for a couple of months now, and I am not
sure that is going to change anytime soon. After all, now we have to wonder
whether or not there is going to be stimulus, and of course how big of a
stimulus package. As I write this, we still do not know the present in the
United States is going to be, but it does look as if the Senate is going to
be Republican. That means there will be no monster stimulus deal coming down
the road, and that could be positive for the US dollar. If that is the case,
that could be the catalyst to send gold a little bit lower. That being said,
I am not a seller, because I do believe in the longer-term efficacy of the
trend.

To the downside, the $1800 level would be a very interesting place to buy
"cheap gold" act, because not only was at the scene of a major breakout, but
it was also where we found the 200 day EMA crashing into. With this being
the case, I think that a lot of attention will be paid to this level, and
therefore it could be a nice longer-term opportunity. After all, regardless
of what happens as far stimulus is concerned, there will be plenty of it
around the world, not just in the United States. Beyond that, there is quite
a bit of uncertainty out there and I think that it is only going to increase
as we continue.-fxempire

Oil price drops as U.S. election uncertainty dominates markets

LONDON: Oil prices fell on Thursday as Democrat Joe Biden edged closer to
the White House in a nail-biting U.S. presidential election, though doubts
remain over further huge stimulus to bolster the ecomony in the face of the
coronavirus crisis.

Brent crude fell 20 cents, or 0.4%, to $41.03 a barrel by 1325 GMT and U.S.
West Texas Intermediate (WTI) crude was down 30 cents, or 0.7%, at $38.85.
Both contracts had jumped about 4% on Wednesday.

Biden predicted victory over President Donald Trump after winning two
critical U.S. states while the Republican incumbent alleged fraud, filed
lawsuits and demanded recounts in a bitter contest that has yet to be
decided.

A drawn-out court battle over the results could cause additional uncertainty
in the market, spawning further sell-offs within risky asset classes.

Current vote counting and trends suggest the Republicans are poised to
retain control of the U.S. Senate, while the Democrats will hold a slimmed
majority in the House of Representatives.

A divided Congress could hamper Biden's plans on climate change, economic
stimulus and the easing of sanctions on oil producer Iran.

Oil prices had surged on Wednesday on growing expectations that the
Organization of the Petroleum Exporting Countries (OPEC) and its allies,
together called OPEC+, would hold off on bringing back 2 million bpd of
supply in January, given demand has been sapped by new COVID-19 lockdowns.

INVESTORS DIARY 2020

Company

Event

Venue

Date & Time

Bindura

AGM

Virtual

05/11/2020 | 14:00

Natfoods

AGM

Royal Harare Golf Club

09/11/2020 | 8:45am

Afdis

AGM

virtual

13/11/2020 | 12:20pm

Zimbabwe

National Unity Day

Zimbabwe

22/12/2020

Christmas Day

25/12/2020

Boxing Day

26/12/2020

New Year's Day

01/01/2021

Invest Wisely!

Bulls n Bears 

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