Bulls n Bears Daily Market Commentary : 26 August 2021

Thu Aug 26 15:46:37 CAT 2021

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Bulls n Bears Daily Market Commentary : 26 August 2021

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ZSE commentary

The ZSE ended with gains in today’s session characterized by an improvement in activity and liquidity. Activity levels were higher at 442 trades. Medtech was the most active stock at 44 trades closely followed by Star Africa at 43 trades and Meikles at 38 trades. Star Africa anchored volume aggregate trading 4 868 200 shares and Delta anchored value aggregate with a value of ZW$28.3 million contributing 23% to total turnover. The benchmark All Share Index added 1.25% to 6 774.61 with 20 losers and 16 advancers while 5 counters remained unchanged. Shares of 41 out of 49 companies were traded.

The Top 10 Index was up 1.56%. The Top 15 Index also added 1.30%. The Medium Cap Index traded higher to 17 230.58 points appreciating by 0.91% whilst the Small Cap Index lost 0.82% to close at 227 457.75 points. Leading the risers pack of the day was Hippo which was up by 14.38%. Masimba Holdings added 13.70% and First Mutual Properties added 10.25% reversing part of a loss from yesterday’s session of 20.00% 10.25%. Innscor was up by 5.57% to 9707.69c. Leading in the shakers’ pack were Truworths and Get Bucks Microfinance which lost 5.98% and 4.16% respectively. Medtech Holdings which is trading under cautionary was down 3.58% to 26.52c. Turnall Holdings and Meikles shaded 2.56% and 2.12% respectively. The Old Mutual Top Ten ETF closed at 225.71c up by 0.22% after 3 800 units with a value of ZW$8 577 in 8 trades exchanged hands..-wealthaccess

Global Currencies & Equity Markets

South Africa

South Africa's rand falls, Fed verdict in focus

(Reuters) - South Africa's rand weakened early on Thursday, as investors turned cautious ahead of the U.S. Federal Reserve's Jackson Hole symposium on Friday, looking for clues on the timing and pace of tapering of monetary stimulus.

At 0630 GMT, the rand ZAR= traded at 14.9880 against the dollar, roughly 0.25% weaker than its previous close.

While a growing number of Fed officials have been actively discussing the likelihood of trimming pandemic-era stimulus, the rise in coronavirus' Delta variant has cast a shade of uncertainty over that view.

The prospect of higher U.S. interest rates tends to lessen the appeal of riskier, high-yielding currencies such as the rand and increase that of the dollar.

Government bonds also weakened in early deals, with the yield on the 2030 ZAR2030= bond adding 2.5 basis points to 8.9%.

Nigeria

Naira slips further at official market

Naira weakened significantly against the U.S. dollar at the official market on Wednesday, even as forex turnover rose.

However, the currency remained stable at the black market window.

Data posted by FMDQ, where forex is officially traded, showed that the local unit closed at N412.00 per $1 at the official market.

This represents a N1.00 or 0.20 per cent devaluation from the N411.00 rate posted in the previous session on Tuesday.

The currency reached an intraday high of N400.00 and a low of N413.00 during the trading session before settling at N412.00 at the close of business on Wednesday.

Forex supply soared by 133.00 per cent with $180.19 million recorded as against the $77.46 million posted in the previous session on Tuesday.

According to abokiFX.com, a website that collates parallel market rates in Lagos, the local unit closed at N521.00 per $1 on Wednesday. The same rate it closed at the previous session on Tuesday.

The disparity between the official and parallel market rates stood at N109.00 as of close of business on Wednesday, leaving a spread of 20.92 per cent.

.

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Global Markets

Dollar rises off one-week low as 2021 taper bets grow

The dollar index, which measures the currency against six rivals, edged up 0.04% to 92.86 after dropping to 92.801 for the first time since Aug. 17.

The dollar rose from one-week lows on Thursday, supported by U.S. Treasury yields holding above 1.34% in a quiet market where focus was firmly trained on what signals the Federal Reserve might send at its annual Jackson Hole conference.

The conference kicks off later in the day in virtual format but the main event is Fed boss Jerome Powell’s speech on Friday where he is widely expected to signal when the central bank could start unwinding its monetary stimulus.

Bond markets sold off heavily on Wednesday, partly on back of investors hedging their bets ahead of the speech, taking 10-year Treasury yields to almost two-week highs.

The dollar index, which measures the currency against six rivals, edged up 0.04% to 92.86 after dropping to 92.801 for the first time since Aug. 17. Against the euro, it was at $1.1774, near a one-week low of $1.1775 hit on Wednesday.

Currency market swings have also eased ahead of the speech, with implied euro-dollar volatility at a one-week low

Markets are assessing how the Fed will react to signs inflation could be less transitory than it had flagged and whether it will stick to its new policy framework of letting inflation run hot.

While Powell has held a dovish tone, there are clear signs of dissent within the Fed.

Signals of a taper starting this year had lifted the dollar index to a 9-1/2-month high of 93.734 last Friday.

But that was before Dallas Fed President Robert Kaplan, among the most forceful advocates for starting to reduce support for the economy, said he may need to adjust that view if the coronavirus slows economic growth materially.

The greenback ticked up 0.04% to the yen but the pair is meandering near the center of its trading range since early July .

Meanwhile, more central banks worldwide are exiting or contemplating exiting from ultra-easy accommodative policies. South Korea’s central bank on Thursday raised interest rates for the first time in three years

The won gave up initial gains, however, to fall 0.6% after the hike which had been well-flagged.

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Commodities Markets

Copper price rises as Chinese buyers come back to the market

The copper price climbed for the fourth day as China’s success in containing a sprawling covid-19 outbreak shored up confidence in the demand outlook.

Indicators in the physical market suggest the country’s appetite for copper is picking up rapidly.

Copper for delivery in September rose 1% from Tuesday’s settlement price, touching $4.3025 per pound (9,465 per tonne) on the Comex market in New York.

There are also signs that the slump in prices last week is enticing consumers back to the market, while simultaneously discouraging suppliers of copper scrap from making sales.

By the end of last week, high-grade copper scrap in China was trading at a premium to refined metal, indicating that scrap supply had rapidly dried up, according to BMO Capital Markets. In turn, high scrap prices and a lack of availability could boost demand for refined metal.

Copper scrap prices have fallen less than futures since a peak in May.

Aluminum also moved closer to a decade-high above $2,700 a tonne, propelled by a global economic recovery that is expected to fuel purchases of goods ranging from automobiles to toasters.

Copper prices are expected to be supported by the potential for near-term supply disruptions in Chile, a recovery in ex-China demand and indications of continued Chinese government support for the economy and employment, said S&P Global.

Indian spot gold rate and silver price on Thursday

Gold Price in India ( ₹47480) has decreased since yesterday( ₹47490). Although, it was above the average gold price observed this week ( ₹47384.3) by 0.2%.

Although global Gold Price Today ($1816.7) experienced growth of 0.18%, the Gold Price remained low in the Indian market ( ₹47480).

Following yesterday's trend, the global Gold Price continued its growth today as well. It was clocked at $1816.7 per Troy ounce in the latest close which noted an increase of 0.18% over yesterday. This price level is 4.24% higher than average Gold Price observed in the past 30 days ($1739.7). Among the other precious metals, Silver Price Today saw a fall. The Silver Price plunged 0.06% to $25.2 per Troy ounce.

Further, platinum price has shown an uptick. The precious metal platinum rose 0.05% to $1078.0 per Troy ounce. Meanwhile in India, gold was priced at ₹47105 per 10 gram on MCX, with a change of ₹14.1. Also, the price of 24k gold in the Indian spot market was quoted at ₹47480 . 

Gold prices in India fell today with futures on MCX by 0.03% to ₹47105 per 10 gram. In the previous session, gold was down 0.87% or about ₹14.1 per 10 gram.

On MCX, silver futures grew nearly 0.25% or ₹157.9 per kg to the price level of ₹63150 per kg.

The gold spot price today ( ₹47480) decreased by ₹14.1 from yesterday ( ₹47490), whereas global spot prices saw growth of $3.25 to $1816.7 value today. Following Indian spot price, MCX future price saw a decrease of ₹14.1 and value of ₹47105 as of today.

The dollar to rupee conversion today increased to ₹74.2 as compared to previous close of ₹74.1. The rise of dollar against rupee might influence gold's rate today reflecting a higher gold price in the domestic markets.

INVESTORS DIARY 2021

Company

Event

Venue

Date & Time

Counters trading under cautionary

ART

Seed co Int.

Dairibord

Starafrica

Medtech

Turnall

Seed co

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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