Bulls n Bears Daily Market Commentary : 09 November 2020

Mon Nov 9 18:41:11 CAT 2020

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Bulls n Bears Daily Market Commentary : 09 November 2020

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

ZSE commentary

ZSE swings into the red in week opener.

The ZSE commenced new week in losses as the mainstream All Share Index and
the Industrials let go a similar 0.13% to 1,508.67pts and 4,978.96pts
respectively. The blue chips Index slipped 0.11% to close at 976.12pts. The
top faller of the day was apparel retailer Truworths that succumbed 17.50%
to $0.1400, trailed by property concern Dawn which shed 7.14% to $0.6500.
Banking group FBC trimmed 5.45% to $13.0000 while, Ariston lost 3.70% to end
pegged at $1.3000. Crocodile skin producers Padenga went down 0.71% to
settle at $13.9003 completing the top five shakers of the day.

Headlining the winners of the day was First Capital which advanced 4.12% to
$0.5278, followed by conglomerate Innscor that ticked up 2.89% to close at
vwap of $21.6157. Star Africa put on 2% to $0.2040 as fast foods group
Simbisa firmed 1.59% to $6.4004. Wrapping the gainers of the day was OKZIM
which rose 1.21% to $4.7995. The risers' and fallers' spectrum was equally
distributed at nine apiece. Activity aggregates faltered in Monday's session
as volumes dipped 65.37% to 3.32m while, turnover dropped 59.31% to $21.39m.
Econet, Delta and Cassava were the top volume and value drivers of the day
with a combined contribution of 75.46% to the latter and 74.88% to the
former. Foreign inflows plunged 64.11% to $0.41m while, outflows plummeted
58.90% to $12.92m to leave the market with a net outflow position.
-efesecurities

Global Currencies & Equity Markets

Nigeria

Naira falls further against the  dollar

The first quarter (Q1) of the year 2020 placed the Nigerian economy in a
vulnerable spot following a crash in global oil prices accompanied by the
devastating impact of the COVID-19 pandemic. More so, the aftermath of a
recent nationwide protest against the country's Special Anti- Robbery Squad
(SAR) unit has been projected to cost the country N700 billion.

Below is the Ventures Africa Weekly Economic Index for the week ending 6th
of November 2020. This economic index gives you a glimpse into other recent
activities in Nigeria's economy as well as changes and prices that could
affect the economy:

Nigerian Stock Exchange 

Data released by the Nigerian Stock Exchange (NSE), showed that the NSE
All-Share Index and Market Capitalization as of November 6, 2020,
appreciated by 1.56 and 1.59 percent respectively to close the week at
31,016.17 and N16.207 trillion.

Similarly, all other indices finished higher with the exception of the
NSE-Main Board, NSE Insurance and NSE Oil/Gas which depreciated by 0.62
percent 1.32 percent and 0.77 percent respectively while the NSE ASeM Index
closed flat.

The Naira decreased against the dollar at the close of last week. The
exchange rate slid to 384 Naira per dollar on the 6th of November 2020,
higher than 381 Naira recorded a week before.

How did the price of oil fare?

Brent oil prices closed out the week on the 6th of November 2020 at
$39.4539.45per barrel, an increase from the $38.97 recorded a week earlier. 

South Africa

Rand retains momentum on the back of the US election

JOHANNESBURG - The South African rand retained positive momentum on the back
of external factors -a Biden presidency - as US elections continued to
dominate global headlines.

In local news, administrators for state carrier SAA indicated that debt to
aircraft lessors and "some creditors" are not covered by the R10.5bn ($665m)
bailout (which only covered "initial commitments") laid out in the
'mini-budget' presented in October, spurring concerns that the embattled
parastatal will knock on government's door for yet another hand-out in the
short term.

Reuters quoted administrators as warning that around R1.7bn is owed to
lessors and R600m to creditors "from before [SAA] went into administration"
(almost one year ago).

Reuters further cited Kgathatso Tlhakudi, director-general of the ministry
responsible for SAA, as stating that government "would pay the amounts to
lessors and longstanding creditors but that it was still working on a
solution."

This came as Public Enterprises Minister Pravin Gordhan announced this week
that "the ultimate aim is to remove the burden ... from our shoulders" as
government is contemplating partnership deals with potential investors; this
process will however be hindered by a burden of unpaid debt. SAA failed to
return profit since 2011.

The local unit traded firmer overnight. Expected range today R15.30/$ -
R15.60/$.

South African bourse

The JSE All Share (0.88 percent) ended higher on Friday led by gains in
large technology (+3.54 percent) stocks. In the overall emerging market
sphere, the MSCI Emerging Market Index (+1.26 percent) traded
stronger.-BUSINESS REPORT ONLINE

 <mailto:info at bulls.co.zw> 

Global Markets

Higher-risk currencies soar on Biden win, successful COVID19 vaccine

LONDON (Reuters) - Trade-related currencies were buoyed on Monday by a pick
up in risk appetite after Joe Biden clinched the U.S. presidency and Pfizer
Inc said its experimental vaccine was more than 90% effective in preventing
COVID-19.

The Scandinavian currencies and the Japanese yen were amongst the biggest
movers, while the offshore Chinese yuan hit its strongest in 28-months.

A Biden presidency is expected to boost international trade relations and
the prospect of a successful coronavirus vaccine is seen as a major
tailwind, with global cases continuing to rise.

Simon Harvey, currency analyst at broker Monex Europe, said although markets
were already trading with "an air of optimism", Pfizer's findings, based on
initial data from a large study, had boosted risk appetite further.

That was benefitting higher beta currencies such as the Norwegian and
Swedish crowns, boosting oil prices and "unravelling" dollar/yen, he added.

The dollar stabilised against a basket of currencies having touched a
10-week low of 92.12 and was last up 0.2% at 92.31.

The Swedish crown rose to a 28-month high of 8.5845 versus the U.S. dollar
and to a 22-month high of 10.20 against the euro.

Its Norwegian counterpart rose 1.6% against both the dollar and the euro to
hit two-month highs against each of 9.0025 and 10.7030 respectively..

The Australian dollar was up 2.4% at 76.85 against the Japanese yen, a
seven-week high. The yen also fell 1.6% against the U.S. dollar to 105.

The offshore Chinese yuan was not far behind, hitting a peak of 6.5501
against the dollar and last up 0.3% at 6.5729.

The Canadian dollar and the Australian dollar both rose 0.8% versus the U.S.
dollar with the latter hitting a seven-week high and the former a nine-month
high.

Saravelos expects the broad trade-weighted dollar to potentially drop by
another 3% to 5% into the end of the year with euro/dollar convincingly
breaking 1.20 and dollar/yen reaching 100.

U.S. dollar selling was being held in check, however, by the virus worries
and because incumbent President Donald Trump has made no sign of conceding
while fighting legal battles to overturn the result.

The prospect of more gridlock in Washington, with Republicans appearing
likely to have retained control of the Senate -- although the final makeup
may not be clear until runoff votes in Georgia in January -- means that
expectations for a massive U.S. fiscal stimulus package have been lowered,
sending bond yields down in anticipation of less borrowing and more
quantitative easing from the Federal Reserve.

Euro/dollar - the most traded currency pair in the world - was up 0.1% on
the day at $1.1892.

German exports rose by more than expected in September, and foreign trade
gave Europe's largest economy a boost going into the fourth quarter as it
struggles to avoid slipping into a double dip contraction.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold price plummets on news of successful Covid vaccine

(Kitco News) - Gold and silver futures prices are sharply down in early U.S.
trading Monday, on the just announced news from Pfizer that it has developed
a very promising Covid-19 vaccine. Stock markets soared on the news,
including U.S. indexes hitting record highs, as risk appetite has up-ticked
markedly the past hour. Gold prices had hit a nearly seven-week high of
$1,966.10 in overnight trading. December gold futures were last down $39.90
at $1,911.70 and December Comex silver was last down $0.792 at $24.855 an
ounce.

Pfizer within the past hour announced a Covid-19 vaccine trial of around
44,000 subjects that is 90% effective gave the stock markets a solid boost
from earlier overnight gains. It seems this is finally the good news the
global marketplace has been awaiting for months-during a grim period when
the pandemic appears to be worsening in places like the U.S. and Europe.

The U.S. dollar index is near steady early today after hitting a nine-week
low overnight. The other important outside market sees crude oil prices
sharply higher and trading around $40.00 a barrel. The yield on the
benchmark 10-year U.S. Treasury note has risen today is currently fetching
0.8%.

The marketplace earlier was calmer to start the trading week. Joe Biden was
declared the winner of the U.S. presidential election on Saturday, and it
appears his margin of victory is growing by the day, as the ballot-counting
continues. The marketplace still reckons control of the U.S. Congress will
be split, with Democrats having the majority in the House of Representatives
and the Senate tilting slightly to the Republicans-even though there is a
chance the Democrats could take the Senate due to still-contested Senate
seats. Stock markets tend to like gridlock and no major shifts in fiscal
policy.

While the specter of more U.S. government regulation of businesses under a
Biden administration is a negative for the stock market, that is being
offset by notions Biden will be a more stable force on the U.S. global
policy front. The Chinese yuan hit a more-than-two-year high Monday on ideas
the U.S.-China relations will improve under Biden.

U.S. economic data due for release Monday is light and includes the
employment trends index.

Technically, the December gold futures bulls still have the overall
near-term technical advantage. Bulls' next upside price objective is to
produce a close in December futures above solid resistance at today's high
of $1,966.10. Bears' next near-term downside price objective is pushing
futures prices below solid technical support at the September low of
$1,851.00. First resistance is seen at $1,925.00 and then at $1,939.40.
First support is seen at the overnight low of $1,899.50 and then at
$1,880.00. Wyckoff's Market Rating: 6.5

December silver futures bulls have the overall near-term technical advantage
but prices are scoring a bearish "outside day" down on the daily bar chart
today, after hitting a nearly seven-week high overnight. Silver bulls' next
upside price objective is closing prices above solid technical resistance at
$27.00 an ounce. The next downside price objective for the bears is closing
prices below solid support at the October low of $22.625. First resistance
is seen at $25.00 and then at $25.71. Next support is seen at the overnight
low of $24.455 and then at $25.00. Wyckoff's Market Rating: 6.5.

INVESTORS DIARY 2020

Company

Event

Venue

Date & Time

Natfoods

AGM

Royal Harare Golf Club

09/11/2020 | 8:45am

Afdis

AGM

virtual

13/11/2020 | 12:20pm

Simbisa Brands

AGM

SAZ, Northend Close, Borrowdale, Harare as well as virtually on:
https:/escrowagm.com/eagmZim/Login.aspx

20/11/2020 | 8:15am

Axia Corporation

AGM

virtual https://escrowagm.com/eagmZim/login.aspx

24/11/2020 | 8:14am

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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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
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for guideline purposes only and sourced from third parties.

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