Bulls n Bears Daily Market Commentary : 19 October 2020

Mon Oct 19 15:54:53 CAT 2020

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Bulls n Bears Daily Market Commentary : 19 October 2020

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

ZSE commentary

Market Turnover ZWL$68,555,757.75 with foreign buys at ZWL$12,242,830.00 and
foreign sales were ZWL$32,669,874.00 Total trades were 186

The All Share index opened the week at 1,483.25 points after losing 10.24
points . PADENGA eased $0.9841 to $14.0000, RIOZIM traded $0.5889 lesser at
$8.3000 and DELTA  was $0.2659 lower at $15.8690. MEIKLES  also decreased by
$0.2471 to $15.1100 and BINDURA traded $0.2015 weaker at $3.7935.

Trading in the positive; HIPPO VALLEY ESTATES added $0.2344 to $14.0370,
AFRICAN SUN   rose by $0.2297 to $1.7997 and INNSCOR  traded $0.1046 higher
at $19.0153. FIRST MUTUAL PROPERTIES  also increased by $0.10000 to $2.3000
and AXIA  was $0.0857 firmer at $3.9900.

Global Currencies & Equity Markets

South Africa

South Africa's rand firms on improved risk appetite

JOHANNESBURG: South Africa's rand started the week firmer on Monday as
appetite for risk was supported by hopes of a US fiscal package and
expectations of a coronavirus vaccine by the end of this year and data
showing China's economy rebounding.

At 0630 GMT, the rand traded at 16.5125 versus the dollar, 0.23pc firmer
than its close on Friday.

A rally in risk assets was buoyed by hopes of a coronavirus vaccine after
drugmaker Pfizer Inc said on Friday it could have a coronavirus vaccine
ready in the United States by the end of this year.

China's rebound from the COVID-19 pandemic stayed on course last quarter as
gross domestic product (GDP) grew 4.9pc, although the weaker-than-expected
headline growth suggested risks persisted.

Government bonds were firmer in early deals, and the yield on the instrument
due in 2030 fell 3.5 basis points to 9.31pc.

African currencies week ahead: Nigeria naira seen steady, Kenyan shilling
may gain

LAGOS: Nigeria's naira is seen trading on an even keel amid a move to curb
transactions while the Kenyan shilling may firm as tax payments trim demand.

NIGERIA - The naira is seen stable next week as banks limit foreign exchange
transactions by both firms and individual buyers on the unofficial black
market to curb speculation, traders said.

The naira was slightly weaker on the black market on Thursday at 462 per
dollar from 457 a week ago. It was quoted on the official market at 381 per
dollar.

The central bank has employed several methods to help support the currency
in the wake of lower prices for oil, Nigeria's main export.

The bank has tried to curb import demand to spur local production in
addition to rationing dollar supply. The naira traded at 386.38 on the
over-the-counter spot market, widely quoted by investors and importers, on
volumes in excess of $29.53 million on Wednesday

KENYA - The Kenyan shilling is seen strengthening as commercial banks get
ready to meet their tax obligations and cash reserves requirements.

On Thursday, commercial banks quoted the shilling at 108.55/75, compared to
last week's close of 108.40/60.

UGANDA - The Ugandan shilling is seen softening in the coming days as a
typical surge in demand for hard currency in the last quarter of the year
starts to kick in.

At 1039 GMT commercial banks quoted the shilling at 3,705/3,715, compared to
last Thursday's close of 3,700/3,710.

TANZANIA - Tanzania's shilling () is expected to hold steady as hard
currency inflows from agricultural exports absorb demand pressure from
manufacturers and oil importers.

Commercial banks quoted the shilling at 2,315/20 on Thursday from an average
of 2,315/25 recorded a week earlier.

ZAMBIA - The kwacha is expected to come under pressure against the dollar
next week as hard currency demand surges after tax payments. On Thursday,
commercial banks quoted the currency of Africa's second largest copper
producer at 20.1100/20.2120 per dollar from a close of 20.0350 a week ago.

 <mailto:info at bulls.co.zw> 

Global Markets

USD/JPY flirts with session lows, around 105.30 region

The emergence of fresh selling around the USD exerted some pressure on
USD/JPY.

The risk-on mood, surging US bond yields might help limit losses, for the
time being.

The intraday USD selling bias picked up pace during the mid-European session
and dragged the USD/JPY pair to daily lows, around the 105.30 region in the
last hour.

The pair failed to capitalize on its early uptick to three-day tops and
witnessed a modest pullback from mid-105.00s amid the emergence of some
fresh selling around the US dollar. Expectations of a COVID-19 vaccine by
the end of this year dented the greenback's status as the global reserve
currency, which, in turn, was seen as a key factor exerting some pressure on
the USD/JPY pair.

However, the downside remains cushioned amid the upbeat market mood, which
tends to undermine demand for the safe-haven Japanese yen. The global risk
sentiment got a strong boost on the back of reviving hopes for additional US
fiscal stimulus measures. The risk-on flow was evident from a strong rally
in the US Treasury bond yields, which might help limit deeper losses for the
USD/JPY pair. 

Nevertheless, the pair has now drifted into the negative territory for the
second straight session and remains at the mercy of the USD price
dynamics/broader market risk sentiment amid absent relevant market moving
economic releases from the US.

>From a technical perspective, the emergence of some dip-buying on Friday
favours bullish traders. However, the lack of any strong follow-through
warrants some caution before positioning for any further near-term
appreciating move. On the flip side, bearish traders might still wait for a
sustained weakness below the key 105.00 psychological mark.-fxstreet.com

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold prices pop higher as investors focus on talks on coronavirus relief

Gold prices on Monday traded higher to start the week, with talk of a
last-ditch effort to strike a deal by U.S. lawmakers on a fresh round of
fiscal relief before the 2020 presidential elections helping to drive buying
appetite, experts said.

See: Here's why the prospect of a Democratic clean sweep in November's
elections is rattling a sleepy U.S. bond market

A weaker dollar also was paving a path higher for bullion because weakness
for the buck can draw interest in gold from buyers using currencies that are
relatively weaker than the buck.

Investors have been attuned to the back-and-forth negotiations between House
Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin on a new round of
funds for American businesses and workers hard hit by the economic weakness
caused by the COVID-19 pandemic.

Pelosi spoke on Saturday with Mnuchin according to reports but appeared to
suggest that a deal before the 2020 presidential election, between President
Donald Trump and Democratic challenger and former Vice President Joe Biden,
was unlikely to be achieved if a fiscal deal isn't struck soon.

Additional relief, should it come, is viewed as bullish for gold which is
being used by some as a hedge against governments dialing up spending and
lowering interest rates to combat the pandemic that has seen more than 40
million people infected across the globe, according to data aggregated by
Johns Hopkins University.

Meanwhile, China's gross domestic product on Monday was seen expanding by
4.9% in the third quarter from a year earlier, below economists' average
estimates but above levels the nation saw before the viral outbreak took
hold late in 2019.

China is one of the world's biggest importers of commodities and an avid
buyer of precious metals like gold.

Against that backdrop, December gold GOLD, +0.81% GCZ20, +0.49% GCZ20,
+0.49% rose $13.80, or 0.7%, to $1,920.20 an ounce, after bullion posted a
1% weekly decline on Friday, based on the most-active contract, according to
FactSet data.

Silver for December delivery SI00, +2.04% SIZ20, +2.04%,  meanwhile, added
59 cents, or 2.4%, to reach $24.985 an ounce, following a weekly slide of
2.8%.

Meanwhile, weakness in the dollar was providing an added boost to
dollar-priced silver and gold. The dollar on Monday was down 0.4% on Monday
at 93.299, as gauged by the ICE U.S. Dollar Index DXY, -0.40%.

INVESTORS DIARY 2020

Company

Event

Venue

Date & Time

Falgold

EGM

1st Floor, KPMG Building, 133 Josiah Tongogara Avenue, Bulawayo

29/10/2020 | 10:00 am

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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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
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subscribe for any securities. The information contained in this report has
been compiled from sources believed to be reliable, but no representation or
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opinions expressed and recommendations made are subject to change without
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