Bulls n Bears Daily Market Commentary : 19 August 2021

Thu Aug 19 16:39:56 CAT 2021

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Bulls n Bears Daily Market Commentary : 19 August 2021

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ZSE commentary

The ZSE continues on its downward trend losing more than ZW$10 billion. The
movement on either side is unimpressive and marginal. Total turnover for the
day was valued at ZW$103.7 million. Activity levels were higher than
yesterday at 427 trades. Star Africa was the most active stock at 65 trades
followed by Delta and Medtech at 41 and 37 trades respectively. OK Zimbabwe
anchored volume aggregate trading 1 247 900 shares and ZB Holdings anchored
value aggregate with a value of ZW$22.55 million. At close, the benchmark
All Share Index slipped 0.79% to 6 848.48 with 15 advancers and 20 losers
while 6 counters remained unchanged. Shares of 41 companies were traded. The
Top 10 Index was down by 0.88%. The Top 15 Index pared 0.75%. The Medium Cap
Index traded lower to 17 962.90 points depreciating by 0.81% whilst the

Small Cap Index added 2.10% to close at 234 172.94 points.

Leading the shakers pack of the day was African Sun down by 8.37% by Econet
and Simbisa retreating by 8.17% and 6.98% respectively. First Capital Bank
was down 5.65% to 355.56c. Leading in the risers' pack were Fidelity which
is struggling for direction and Medtech which added 15.00% and 8.81%
respectively. Art Corporation  was up 5.00% to 798.79c. Unifreight and
Edgars added 4.98% and 4.11% respectively. The Old Mutual Top Ten ETF closed
at 227.02c down by 7.34% after 4 367 units with a value of ZW$9 914 in 6
trades exchanged hands.wealthaccess

Global Currencies & Equity Markets

South Africa

Rand hits R15.17 to dollar - worst level since MarchWeakens below key level
in early morning trade on Thursday.

The rand, which managed to avoid a major blowout following riots in two of
South Africa's key provinces in July, finally gave way and weakened below
the psychological R15 to the US dollar level on Thursday.

This is its weakest level since March.

The local currency hit R15.17 to the greenback around 10am, after breaking
above the R15 mark in early morning trade on Thursday.

While the decline is being largely attributed to a surging dollar, the fact
that the JSE was offline to trading for most of Wednesday may have also been
a factor in the currency weakening.

The more than five-hour outage on the JSE prevented trade in stocks "until
well into the afternoon on Wednesday" Bloomberg reported.

Frustrated JSE traders forced out for a walk as bourse paralysed

JSE stock trading to resume after delay caused by record volumes

It said that this was "not a good signal for a bourse that touts itself as
Africa's finest" and "in a country that needs to attract foreign investment
to help fuel growth and reduce unemployment".

Regarding the surging dollar, Andre Cilliers currency strategist at
TreasuryONE, flagged in a note on Thursday morning that the US Federal Open
Market Committee (FOMC) meeting influenced the stronger dollar.

Nigeria

Naira loses at black market first time in five days

The naira weakened against the U.S. dollar at the parallel market window on
Wednesday after the rate remained stagnant in the last five consecutive
trading sessions of the unofficial market.

According to abokiFX.com, a website that collates parallel market rates in
Lagos, the local unit closed at N517.00 per $1 on Wednesday, as against the
N515.00 per $1 rate it traded in the past five market sessions respectively.

Wednesday's performance represents a N2.00 or 0.40 per cent devaluation from
the N515.00 rate it exchanged hands with the hard currency in the last five
previous sessions simultaneously.

Similarly, the naira fell marginally against the U.S dollar at the official
market (Nafex window) on Wednesday, as forex turnover remained unchanged
from what it was in the previous session on Tuesday.

Data published on the FMDQ Security Exchange where forex is officially
traded showed the domestic currency closed at N411.75 per $1 on Wednesday.

This implies a N0.25 or 0.10 per cent depreciation from the N411.50 rate it
traded in the previous session on Tuesday.

The currency experienced an intraday high of N400.00 and a low of N412.85
during the trading session before settling at N411.75 at the close of
business on Wednesday, the same range it oscillated in the previous session
as well.

This became pronounced as the market forex turnover remained stable at
$113.17 million, the same amount posted in the previous session on Tuesday.

The last time the naira closed at N411.75 on the dot was on June 16, two
months ago.

The spread between the official and black-market rates is pegged at N105.25,
leaving a margin of 20.40 per cent as of the close of business on Wednesday.

.

 <mailto:info at bulls.co.zw> 

Global Markets

U.S. dollar dips from 4-1/2-month high after Fed minutes, last flat on the
day

(Reuters) - The dollar slipped from 4-1/2-month highs to trade little
changed on Wednesday after minutes of last month's Federal Reserve meeting
suggested there was no consensus about the timing of a tapering of its asset
purchases under the U.S. central bank's quantitative easing program.

A reduction in debt purchases is typically positive for the dollar as it
means the Fed will not be flooding the financial system with cash,
increasing the greenback's value.

The minutes also said most participants "judged that the Committee's
standard of 'substantial further progress' toward the maximum-employment
goal had not yet been met."  

This means that Fed policy would remain accommodative for some time,
providing no support for the dollar.

In afternoon trading, the dollar index was little changed at 93.137, sliding
from a 4-1/2-month peak of 93.267.

The euro hit a session high versus the dollar after the release of the Fed
minutes, rising from its lowest since April 1. It was last flat at $1.1712 .

The dollar earlier gained ground as nagging concerns about the global
economy forced investors to seek safety in the greenback.

In the United States, U.S. housing starts dropped 7.0% to a seasonally
adjusted annual rate of 1.534 million units last month. read more

Against the yen, the dollar rose 0.2% to 109.85 .

The commodity-linked currencies such as the Australian and New Zealand
dollars trimmed losses versus the greenback after the release of the Fed
minutes.

The Aussie dollar was last down 0.2% at US$0.7244 , while the New Zealand
currency fell 0.4% to US$0.6892 .

A monthly fund manager survey by investment bank BoFA Securities showed that
investors flipped to a net overweight on the dollar for the first time in
nearly a year. 

That shift in positioning was evident in more high-frequency weekly data as
well with hedge funds ramping up their net long bets on the greenback to the
most since March 2020.

While the dollar failed to draw any sustained strength from Fed Chair's
Jerome Powell's comments and mixed U.S. data, markets shifted focus toward
the Jackson Hole symposium where some expect the Fed to signal a change in
direction with regards to its asset purchase plans.

In cryptocurrencies, bitcoin traded up 1.8% at $45,504 , not far from
Saturday's three-month high of $48,190. Ether stood at $3,064 , up 1.8%.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold slips as dollar scales multi-month high on Fed minutes

Gold prices fell on Thursday as a jump in the U.S. dollar made bullion more
expensive for other currency holders after minutes from Federal Reserve's
July meeting showed tapering of its massive stimulus is possible this year.

Spot gold was down 0.5% at $1,778.66 per ounce by 0832 GMT. U.S. gold
futures eased 0.2% to $1,780.70.

The U.S. dollar rose to a nine-month high as global markets went into a
tailspin after Fed minutes showed policymakers expected to reduce
pandemic-era stimulus before the year is out.

The greenback, which often competes with gold as a safe-haven, also
benefited from concerns over a surge in COVID-19 Delta variant cases,
analysts said.

Fed policymakers noted the next few months' jobs reports will be crucial,
with solid gains needed to meet the U.S. central bank's expectations and
show that the coronavirus has not begun to again slow the economy.

Though gold is seen as a hedge against inflation and currency debasement,
the Fed's tapering would tackle both those conditions thereby diminishing
gold's appeal.

Spot silver dropped 1.2% to $23.21 per ounce. Platinum slipped 2.4% to
$970.40 to a more than one-week low.

Palladium fell 1.5% to $2,389.68 per ounce, its lowest level since March 16.

INVESTORS DIARY 2021

Company

Event

Venue

Date & Time

Counters trading under cautionary

ART

Seed co Int.

Dairibord

Starafrica

Medtech

Turnall

Seed co

Invest Wisely!

Bulls n Bears 

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