Bulls n Bears Daily Market Commentary : 05 October 2020

Mon Oct 5 17:02:51 CAT 2020

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Bulls n Bears Daily Market Commentary : 05 October 2020

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ZSE commentary

ZSE remains directionless…

The market continued to struggle for direction in Monday’s session as it swung into losses with all indices closing pointing southwards. The mainstream All Share Index lost 4% to 1575.51pts with the Industrials shedding 4.04% to 5188.47pts. The Top Ten Index suffered most as it succumbed 5.84% to 1039.98pts while, the Mining Index was 2.45% down to 3785.30pts on waning Bindura which plunged 3% to close at $3.8800. Topping the losers set was banking group CBZ which plunged 19.94% to $42.3500 on paltry shares. FMP followed, slumping 7.10% to $2.0438 with Hippo shedding 6.51% to $13.2000. Lafarge was down 2.29% to end at $6.1000 and completed the top five losers set. Other losses were registered in Cassava (-0.26%), Innscor (-0.42%), Padenga (-0.34), SeedCo (-0.48%) and Simbisa (0.81%). Overall, A negative market breadth was registered as sixteen counters traded in the negative against nine risers, while ten sailed stable.

Mash topped the risers of the day on an 20% surge to $0.5010 on scrappy 300 shares while, OKZIM was 2.33% firmer at $4.8098, having touched a high of $4.9800. Willdale rose 2.13% to $0.2300 with African Sun ticking up 1.91% to $1.6750. Natfoods added 1.83% to $50.0000 as demand remained firm demand. Volumes exchanged rose 9.89% to 3.34m shares, yielding a value outturn of $22.39m which indicated a 5.75% decline from prior session. Innscor drove the value outturn of the day after claiming 52.12% while Edgars and Innscor propelled the day’s volumes with a combined contribution of 45.55%. Foreign participation remained depressed as a mere 103,160 inflows were registered against outflows of $917,620.09, leaving the market with a deficit balance of payments.-efesecurities 

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

Global Currencies & Equity Markets

Zambia

Kwacha to weaken on bondholders’ rejection of govt debt suspension

THE kwacha is expected to continue depreciating against major currency convertibles, given the heightened demand for dollars on the local market, exacerbated by government’s need to resume external debt service payments, market data shows. 

According to financial market players, the kwacha is set to maintain a weak position, holding above the K20.00 per dollar mark, mainly induced by government’s need to resume external debt service payments on the Eurobonds, expected to resume on October 14, following a rejection by bondholders to suspend interest payments. 

South Africa

Rand set for sixth day of gains as markets eye US stimulus

At 10.40am, the rand had strengthened 0.75% to R16.4187/$, 0.56% to R19.2734/€ and 0.44% to R21.2691/£. The euro had firmed 0.23% to $1.1740

The rand was on track for its sixth day of gains on Monday morning as investors eye stimulus talks in Washington.

At 10.40am, the rand had strengthened 0.75% to R16.4187/$, 0.56% to R19.2734/€ and 0.44% to R21.2691/£. The euro had firmed 0.23% to $1.1740.

 <mailto:info at bulls.co.zw> 

Global Markets

Dollar dips as stimulus hopes boosts risk sentiment

(Reuters) - The safe-haven U.S. dollar dipped on Monday and riskier currencies outperformed as risk appetite improved on optimism that lawmakers in Washington will reach a deal for new stimulus to blunt the economic impact of the coronavirus.

Stocks opened higher on Monday on the stimulus hopes and as doctors said that U.S. President Donald Trump could be discharged from the hospital where he is being treated for COVID-19.

Failure to reach a deal, however, would likely be positive for the dollar, which on Monday fell 0.41% against a basket of major currencies.

The euro gained 0.57% to $1.1783, the highest since Sept. 21.

The Australian dollar rose 0.35% to $0.7187 and the greenback dipped 0.76% to 9.2296 krone

Trump's COVID-19 diagnosis is adding an extra layer of uncertainty to how the U.S. Nov. 3 presidential election will play out, and what it could mean for the greenback.

Trump could be discharged from the hospital where he is being treated for COVID-19 as soon as Monday, according to his doctors, although his condition remained unclear and outside experts warned it could be severe.

The U.S. Federal Reserve will release minutes from its September meeting on Wednesday and the European Central Bank will release its latest meeting minutes on Thursday.

Sterling gained 0.43% to $1.2986.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Crude oil prices gain more than 4% on President Trump’s improved health

President Trump’s recent improved health status lifted the morale of oil traders, as buying pressures increased across the energy market, on Monday.

The London trading session witnessed high price upswings with major oil benchmarks gaining 4%.

Trump’s health update eased political growing geopolitical concerns with Brent crude prices trading above $40/ barrel and U.S. West Texas Intermediate (WTI) above its critical support level of $38.50/barrel.

Prices had earlier dropped 4% last Friday amid growing uncertainty surrounding Trump’s health, adding to the concern that rising coronavirus case numbers could dampen global economic recovery.

But analysts said Monday’s rebound was driven by an easing of the worst fears about President Trump’s health condition.

The market is searching for a new narrative. Regardless of the election outcome, the new President will be focused on getting the US back to full employment and fast.

Gold edges up as weaker dollar offsets news on Trump's progress

Gold inched up on Monday as the dollar weakened, although gains were limited as news that U.S.

President Donald Trump, receiving treatment for COVID-19, could be released from hospital boosted risk sentiment.

Spot gold was up 0.1% at $1,900.46 per ounce. U.S. gold futures were down 0.2% at $1,904.50.

And, on the other hand, "we see the dollar has started to weaken again and this is offsetting the losses from the risk-on sentiment," he added.

Global stocks rose on Monday after news that Trump could be discharged from hospital as soon as Monday, although outside experts warned that his case may be severe.

The dollar was down 0.3% against rivals, making gold cheaper for holders of other currencies.

Meanwhile, reinforcing the economic damage from the coronavirus, data showed the euro zone's economic recovery faltered in September.

Investors are now focused on new U.S. coronavirus relief aid aimed at cushioning the economic blow from the pandemic.

Gold has risen about 25% this year, supported by massive stimulus by governments and central banks worldwide as the metal is seen as a hedge against inflation and currency debasement.

Elsewhere, silver gained 1.1% to $23.95 per ounce, platinum rose 0.1% to $882.41 and palladium climbed 0.7% to $2,325.07.

INVESTORS DIARY 2020

Company

Event

Venue

Date & Time

Invest Wisely!

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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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