Bulls n Bears Daily Market Commentary : 24 November 2020

Tue Nov 24 18:25:24 CAT 2020

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Bulls n Bears Daily Market Commentary : 24 November 2020

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

ZSE commentary

Fidelity highlights Tuesday's session.

A block trade in Fidelity highlighted today's trading session as 50.52m
shares worth $75.78m exchanged hands at a price of $1.5000. The trades in
the life assurer accounted for 78.41% of total volumes traded and 58.92% of
the value aggregate. The other notable volume and value driver was Masimba
which claimed 12.95% of the former and 19.45% of the latter. Volume of
shares traded ballooned 1,342.71% to 64.42m while, turnover surged 186.44%
to $120.60m. Local purchases accounted for 99.82% of turnover while, sales
claimed 73.80% of the same. Thirty-two counters registered price movements
in the session distributed as nine risers and twenty-three fallers to record
a negative market breadth of fourteen.

Construction group Masimba headlined the winners of the day on a 12.04% jump
to $2.9974, trailed by Hippo that advanced 5.05% to $17.6016. The duo of
apparel retailers Edgars and Truworths gained 4.94% and 3.23% to close at
respective prices of $1.0000 and $0.1500. Conglomerate Meikles completed the
top five risers of the day on a 3.13% lift to $16.5000. Star Africa led the
losers pack on a 14.32% drop to $0.2500 as RioZim followed having lost 9.11%
to $7.7260. Banking group CBZ let go 6.85% to close at $37.2500 while,
Ariston trimmed 3.70% to settle at $1.3000. Fast foods group Simbisa capped
the top five fallers of the day on a 3.54% fall to $6.7534. The All Share
Index shed 1.71% to 1,600.73pts while, the Industrials slipped 1.70% to end
at 5,295.79pts. The ZSE Top Ten Index retreated 1.99% to 1,046.75pts while,
the resources index pared 2% to close at 3,323.54pts. -efesecurities

Global Currencies & Equity Markets

South Africa

Rand rides the wave of downgrade as external conditions improve

JOHANNESBURG - The South African currency rode the wave of downgrades with
ease as external conditions improved on the back of vaccine hopes according
to NKC Research.

Risk assets applauded releases over the weekend that the United States aims
to give the first vaccines to healthcare workers by mid-December, after
promising trial results. The announcement stoked hopes that the rest of the
world may follow suit with a vaccination programme, enabling a quicker
recovery to a pre-pandemic trade environment.

At the close of local trade, the rand quoted 0.08 percent weaker at
R15.43/$, after trading in a tight range of R15.26/$ - R15.44/$. The rand
traded weaker overnight. The expected range of the rand against the dollar
today is R15.25/$ - R15.50/$.

South African bourse

Overall, yesterday was a mixed bag but the JSE All Share (+0.2 percent)
manged to eke out a slight gain thanks to a 4.0 percent advance in large
tech. In the overall emerging market sphere, the MSCI Emerging Market Index
rose 0.7 percent.

Brent crude oil

The Brent oil price built on last week's gains as traders hoped for a
recover in fuel demand following more successful coronavirus vaccine trials.
At the close of local trade, benchmark Brent crude futures quoted 0.73
percent higher at $54.57pb. Crude prices traded firmer during Asian trade.-
BUSINESS REPORT ONLINE

Nigeria

Nigerian Parallel Market Can't Dictate Naira Rate, Emefiele Says

Nigeria's official exchange rate should not be determined by the parallel
market where the naira value has weakened to a three-month low.

The local unit changed hands at 483 naira to the greenback on the parallel
market on Tuesday, according to abokifx.com, a website that collates street
rates in Lagos. That compares to the 386.16 on the spot market as at 3:55
p.m local time.

Low liquidity in the much cheaper official window means that those who need
dollars patronize the parallel market, making the greenback more expensive.
The International Monetary Fund has urged the central bank to allow more
flexibility in its preferred window to reduce the demand in the parallel
market.

A depreciation of the local currency by 24% this year is huge compared to
other countries like India, Indonesia, Russia or South Africa, Emefiele
said.

 <mailto:info at bulls.co.zw> 

Global Markets

Pound Sterling is Best Performer on Dual Brexit and Covid Vaccine News, Euro
and Dollar Mixed

Lock in today's rate for use at a future point in coming months, here.

Optimism over covid-19 vaccines and hopes of an imminent Brexit trade deal
continue to underpin a rally in the value of Sterling against the majority
of its peers, however one foreign exchange trader we follow says the
currency will likely sell off in the wake of a deal being struck.

The British Pound was the best performing major currency at the start of the
new week after sentiment towards the currency boosted by news that the
University of Oxford and AstraZeneca's vaccine candidate has proven
successful in preventing the transmission of covid-19 in phase three trials.

Meanwhile, news reports concerning the status of post-Brexit trade
negotiations suggested the two sides were closing in on a deal.

Pound is best performer exchange rates 

Above: Sterling was the best-performing major currency on Monday. Book your
ideal exchange rate automatically as soon as it is reached, find out how,
here.

The AstraZeneca-Oxford University announcement is a big moment in the fight
against covid as this vaccine candidate is substantially cheaper than its
competitors and can be stored in room temperature.

More countries have preorders of the AstraZeneca candidate than any other
and it is believed it will be faster to produce and distribute than the mRNA
candidates from Pfizer and Moderna.

While vaccine news has provided some potential upside to Sterling, ongoing
expectations for a post-Brexit trade deal being reached between the EU and
UK is likely the single most important driver behind Sterling's
post-September rally.

The outline of a Brexit trade deal should be sketched out by the end of this
week, Ireland's Prime Minister Micheal Martin said on Monday.

A call is meanwhile expected to take place later this week between Prime
Minister Boris Johnson and European Commission President Ursula von der
Leyen in an effort to provide the political impetus to get a deal over the
line.

The consensus amongst the analyst community is Sterling will rise in the
event of a trade deal being reached, however pushing back against this view
is Ben Donnelly, a Spot Trader at HSBC in New York.

HSBC have adopted a thesis that the primary driver of foreign exchange
markets going forward will be how one country's growth compares to another.
The chart presented by Donnelly shows the cyclical outlook for G10 and
Emerging Market currencies, showing where GBP will end 2021 relative to 2019
levels (using 2020 actual and 2021 forecasts):

HSBC relative growth and FX

HSBC's latest foreign exchange forecasts - out earlier this month - maintain
a counter-consensus view on Sterling, and they expect the currency to weaken
from current levels.

HSBC are forecasting the Pound-to-Dollar exchange rate to trade at 1.30 by
year-end - a significant upgrade from previous forecasts of 1.20.

But the pair is seen at 1.25 by mid- and end-2021, lower than current spot
levels.

The Pound-to-Euro exchange rate is forecast to trade at 1.11 by year-end
2020, a substantial upgrade from the previously-held forecast of 1.04. By
mid-2021 the pair is seen at 1.09 where it is estimated to remain at
year-end 2021.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold extends slide as investors shift to 'risk on' mode

Gold fell to a four-month low on Tuesday, hurtling towards the $1,800
psychological level as progress on a COVID-19 vaccine and hopes for a quick
transition in the White House drove a shift to riskier assets.

Spot gold dropped 1.7% to $1,804.92 an ounce having touched its lowest since
July 17 at $1,800.90. On Monday it lost as much as 2.2%. U.S. gold futures
shed 1.9% to $1,802.20.

Wall Street opened higher after Joe Biden got a formal nod to transition
into the White House, adding to the upbeat sentiment driven by encouraging
vaccine developments from major drugmakers including AstraZeneca, Pfizer and
Moderna.

Also, Biden is expected to nominate former Federal Reserve Chair Janet
Yellen as U.S. Treasury secretary, and investors see Yellen as a force for
more fiscal action to combat the economic crisis unleashed by the pandemic.

Bullion's slide also came despite a subdued dollar, which held close to a
near three-month trough.

Gold is still up about 19% so far this year, benefiting from its status as a
hedge against likely inflation and currency debasement spurred by the
unprecedented pandemic-led global stimulus.

Elsewhere, silver dipped 2% to $23.10 an ounce, platinum rose 0.9% to
$934.93 and palladium dropped 1.1% to $2,329.18.

INVESTORS DIARY 2020

Company

Event

Venue

Date & Time

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
the securities of more established companies. Neither Faith Capital nor any
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for guideline purposes only and sourced from third parties.

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