Bulls n Bears Daily Market Commentary : 26 April 2021

Mon Apr 26 17:09:00 CAT 2021

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Bulls n Bears Daily Market Commentary : 26 April 2021

 <https://www.cbz.co.zw/> 

ZSE commentary

The ZSE started the week in a winning streak with gains across all indices.
Turnover improved by 15% to ZW$120.09 million from a trade of over 9.8
million shares which exchanged hands in 383 trades. Econet was the most
active stock at 24 trades followed by Star Africa and OK Zimbabwe. The
market breadth was positive after 20 stocks appreciated against 14 that
depreciated in a total of 38 stocks which traded. First Capital Bank was the
most liquid counter as it anchored volume aggregate after it traded 4.16
million shares with a value of ZW$8.97 million. Cassava led the value
aggregate at ZW$37.4 million.

The benchmark All Share Index was up 0.99% and the Top 10 Index was up by a
marginal 0.31%. The Top 15 Index added 0.83% to 2 943.13. The Medium Cap
Index traded higher to 10 929.28 appreciating by 2.08%, whilst the Small Cap
Index added 1.90% to close at 44 054.33. Leading the risers pack of the day
was ZB Holdings  which added 18.42% and Mashonaland Holdings with a 11.26%
share appreciation. Meikles Limited  added 8.55% to 5973.25c. Fidelity
appreciated by 8.18%. First Mutual Holdings gained 7.14% to close at 2250c.
Leading in the shakers pack was Edgars  which pared 9.21% followed First
Capital Bank shading 6.54%. Star Africa and African Sun pared 5.24% and
4.58% respectively. Please find a summary of the market activity as shown
below; The Old Mutual Top Ten ETF closed at 170.09c up 1.89% after 53
500units with a value of ZW$90 999.62 in 20 trades exchanged
hands..-wealthaccess

 <https://www.firstmutual.co.zw/> 

Global Currencies & Equity Markets

African currencies week ahead: Kenyan and Zambian units seen softening

NAIROBI: Kenya and Zambia's currencies are expected to come under pressure
next week though Uganda's will likely firm against the US dollar, analysts
and traders said. Nigeria and Tanzania's currencies are seen holding steady.

KENYA - Kenya's shilling is expected to face pressure next week as month-end
demand for dollars from importers increases.

On Thursday, commercial banks quoted the shilling at 108.35/108.55 against
the dollar compared with last week's close of 106.95/107.15.

Kenya's central bank on Tuesday cushioned the shilling by selling dollars in
the foreign exchange market.

ZAMBIA - The Kwacha will likely remain on the back foot against the dollar
next week as demand for hard currency continues to outweigh supply.

On Thursday, commercial banks quoted the currency of Africa's second largest
copper producer at 22.2275 per dollar from a close of 22.1800 a week ago.

UGANDA - The Ugandan shilling is seen maintaining its strengthening streak
on the back of some end-month hard currency inflows. At 0736 GMT commercial
banks quoted the shilling at 3,605/3,615 against the dollar, compared with
last Thursday's close of 3,615/3,625.

NIGERIA - The naira is seen flat in the coming week after the central bank
sold more dollars on the spot and forwards market last week to clear a
backlog of demand from foreign investors seeking to repatriate profits,
traders said. The currency hit a low of 422 naira against the dollar on the
over-the-counter spot market on Thursday but recovered to 409.68 naira, a
range it has been trading at since February.

It was quoted at 486 naira per dollar on the black market on Thursday,
weaker than 482 naira it hit at the start of the week. The naira remains
flat on the official market, which is backed by the central bank, at 381
naira, where it has been stuck since last July.

TANZANIA - Tanzania's shilling is expected to hold steady next week as
inflows from investors balance out demand for the dollar from energy and
manufacturing importers.

Commercial banks quoted the shilling at 2,310/2,324 against the dollar on
Thursday, nearly the same levels recorded a week earlier.

South Africa's rand edges higher in thin trade

South Africa's rand edged higher early on Monday in thin trade ahead of a
national holiday, with traders unlikely to take many big bets ahead of some
key data due later in the week.

At 0630 GMT, the rand was 0.12% firmer at 14.2700 per dollar, not far-off
its close at 14.2875 on Friday in New York.

The rand has made solid gains in April, outperforming its emerging market
peers, with gains of around 3% year-to-date against the U.S. dollar, as
higher commodity prices cushioned demand for the currency against rising
U.S. Treasury yields.

But the currency has struggled to break through the 14.20 technical
resistance level, an indication of the caution over the country's economic
growth and slow pace of vaccine rollouts.

On Monday, the health ministry said it was resuming the Johnson & Johnson's
(JNJ.N) COVID-19 vaccine research study after it was paused over rare cases
of blood clots. read more

Producer price inflation on Wednesday kicks off a sequence of month-end data
releases, including national budget and trade figures, which may provide
direction for the currency in addition to the U.S. Federal Reserve meeting
this week.

Bonds edged lower, with the yield on the 2030 benchmark issue adding 1 basis
point to 9.225%.-The Thomson Reuters Trust Principles.

 <mailto:info at bulls.co.zw> 

Global Markets

Dollar Outlook Divides Investors Who Clash on U.S. Recovery

The most popular currency trade at the beginning of the year has splintered
as Wall Street takes to opposing sides on the fate of the dollar in the
world's pandemic recovery.

JPMorgan Asset Management and T. Rowe Price see the dollar weakening as U.S.
economic exceptionalism wanes, while PineBridge Investments expects it to
strengthen. Currencies from the euro to the Brazilian real -- which suffered
in the first quarter -- have attempted rallies this month leaving the
greenback sitting at a closely-watched technical crossroads.

Dollar close to breaking down from this year's uptrend

While most on Wall Street called for a weaker dollar in January, the world's
reserve currency went on a run that left speculative funds scrambling to
cover $30 billion of net short positions as Treasury yields climbed and
expectations of rate hikes were brought forward. That trade soured this
month, with the Bloomberg Dollar Spot Index slipping 2.3%. A break of the
uptrend in place from its first quarter would point the way to further
downside.

This week's policy assessment by the Federal Reserve, which has held firm
against hawkish expectations, could lend weight to bears. At the crux of
dollar forecasts is expectations for the pace of recovery in the world's
biggest economy.

As the world strives to break free from the bruising economic effect of
coronavirus restrictions, the U.S. has inoculated more citizens than any
other country, giving it an edge in the race to re-open. Coupled with the
Biden administration's multi-trillion dollar fiscal stimulus and a Fed
that's allowing inflation to overshoot, it's spurring the likes of
PineBridge Investments to predict more dollar gains.

Ten-year U.S. yields surged more than 80 basis points this year to 1.77% in
March, the highest since before the pandemic. While the benchmark stood at
1.58% Monday, it remains well above this year's low of around 0.90%.

Speculators covered nearly all bearish dollar bets amid rise in yields

Catching Up

But not everyone is convinced the U.S. will continue outpacing peers.

For JPMorgan Asset's Thushka Maharaj, its exceptionalism is set to fade as
other nations catch-up on vaccine roll-outs and economic re-openings in the
second half of the year.

The London-based strategist is keeping tabs on developed markets like
Europe, the U.K. and Japan, and sees the euro outperforming the dollar in
the medium term. "We are expecting the rebound in these economies to mirror
what we are seeing in the U.S. right now," she said.

Signs abound this trend is underway.

Coronaviruses cases are rising in all regions except Europe, the World
Health Organization said on Tuesday. The European Union is unleashing a new
immunization drive to cover the bulk of its population within a few months,
while on the economic front, recent PMI data have beaten expectations.

The euro has climbed about 3% from a four-month low in March, and broke
through the key $1.20 level last week.

Euro back above $1.20, seeks to break through cloud resistance

Some favor other currencies to best the greenback. T. Rowe's Thomas
Poullaouec sees more gains for Australia's risk-sensitive dollar as China's
economy rebounds from the pandemic and demand for commodities rise.

The Brazilian real, Indian rupee and Colombian peso -- which have been
pummeled as the coronavirus raged across those countries -- stand out for
the head of emerging-market sovereign debt in London.

Substantially Overvalued

In the meantime, vocal bears continue to warn about long-term headwinds for
the dollar.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold ticks up as dollar stays on back foot

(Reuters) - Gold prices inched higher on Monday, helped by a soft dollar
ahead of the U.S. Federal Reserve policy meeting this week, while palladium
held below a record peak scaled last week.

    FUNDAMENTALS

* Spot gold was up 0.1% at $1,779.36 per ounce by 0127 GMT. U.S. gold
futures rose 0.1% to $1,780.10 per ounce.

* Palladium was up 0.1% at $2,857.01 per ounce. It back foohad hit a record
high of $2,925.14 on Friday.

* The dollar index nursed losses against its rivals, making gold less
expensive for other currency holders. 

* U.S. factory activity powered ahead in early April, while retail sales
jumped to a record in March and hiring accelerated.

* Investors poured $16.4 billion into global bond funds and $14.9 billion
into money market funds in the week ended April 21, according to Refinitiv
Lipper data, as concerns about a global rise in COVID-19 cases prompted
moves towards safer assets.    

* A partnership between miners Newmont and Barrick in Chile said on Friday
it would work with local communities to boost development of its Norte
Abierto gold-copper project despite a setback in the courts this week.  

* Speculators raised their bullish positions in COMEX gold in the week to
April 20, the U.S. Commodity Futures Trading Commission said on Friday.    

* India's physical gold demand faltered last week as strict restrictions to
contain the spread of COVID-19 kept buyers away.

* Zimbabwe's gold production fell 30% to 3.98 tonnes in the first quarter of
this year, central bank data showed.

* Silver rose 0.2% to $26.04 per ounce. Platinum was up 0.3% at $1,233.48. 

Oil prices end the week down as demand's rebound gets patchy

(Bloomberg) -Oil prices fell last week with spreading coronavirus cases in
countries such as India tempering optimism around positive signs out of the
U.S. and Europe.

Futures in New York rose the most in over a week on Friday, but were unable
to reverse a 1.6% weekly loss as the market weighed a global economic
reopening that's coming in fits and starts. The U.S. has remained near the
forefront of the world's budding demand recovery from the pandemic, and the
latest manufacturing figures out of Europe have stoked optimism around a
recovery there.

However, India has been setting record numbers of daily coronavirus cases,
threatening demand in the world's third-largest oil importer. The country's
diesel and gasoline consumption could fall by a fifth this month, and
traders said the nation's largest refiner had refrained from buying West
African oil this week, defying expectations.

Oil is up almost 30% this year, but prices have struggled to reach new
heights recently with the coronavirus situation deteriorating in some key
oil consuming countries. India's combined consumption of diesel and gasoline
is poised to plunge by as much as 20% in April from a month earlier due to
renewed restrictions, according to officials from refiners and fuel
retailers. Meanwhile, Japan is facing an increase in cases and a state of
emergency will be declared from Sunday to May 11 in cities including Tokyo.

Prices

WTI for June delivery rose 71 cents to settle at $62.14 a barrel

Brent for the same month gained 71 cents to settle at $66.11 a barrel. The
contract fell nearly 1% over the week

While India has so far avoided re-entering a nationwide lockdown, the demand
impact would be comparable to the one faced during last year's initial wave
were it to do so, Cornerstone Macro analysts Jan Stuart and Thomas Marchetti
said in a note.

Still, prices have averted further losses, aided by the rollout of Covid-19
vaccines and vigilant supply management from the Organization of Petroleum
Exporting Countries and its allies. OPEC+ is set to start easing deep supply
curbs from May, and the group is expected to hold a full ministerial meeting
next week to assess the global state of play.

Adding to daily gains on Friday was a string of robust economic data out of
the U.S. New-home sales in the country rebounded in March to the highest
since 2006, while a composite gauge of output at manufacturers and service
providers reached a record high in April. The U.S. dollar weakened on
Friday, boosting the appeal of commodities priced in the currency, while the
S&P 500 Index climbed.

INVESTORS DIARY 2021

Company

Event

Venue

Date & Time

BAT

AGM

Cresta Lodge, Msasa

30/04/21 10am

Workers Day

01/05/21

FCB

AGM 

virtual

06/05/21 : 3pm

NMB

AGM

virtual

1205/21 :  3:30pm

Africa Day

25/05/21

Counters trading under cautionary

ART

Seed co Int.

Dairibord

Starafrica

Medtech

Turnall

Seed co

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
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.

(c) 2021 Web: <http://www.bullszimbabwe.com>  www.bullszimbabwe.com Email:
<mailto:info at bulls.co.zw> info at bulls.co.zw Tel: +263 4 2927658 Cell: +263 77
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