Bulls n Bears Daily Market Commentary : 30 August 2021

Tue Aug 31 04:16:04 CAT 2021

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Bulls n Bears Daily Market Commentary : 30 August 2021

 <mailto:info at bulls.co.zw> 

ZSE commentary

The ZSE closed today struggling for direction as it closed near flat but in
the red although the losses were marginal. At close, market bias-maintained
negativity as 19 stocks registered losses against 17 advancers while 4 of
the active stocks remained unchanged. Activity levels were lower at 371
trades. Star Africa was the most active stock at 39 trades closely followed
by OK Zimbabwe at 37 trades and Delta at 28 trades. Bindura anchored volume
aggregate trading 796 700 shares and Delta anchored value aggregate with a
value of ZW$10 million.

The benchmark All Share Index lost 0.26% to 6 718.29 points. Shares of 40
out of 49 companies were traded. The Top 10 Index was down 0.25%. The Top 15
Index added 0.12%. The Medium Cap Index traded lower to 17 144.79 points
depreciating by 0.30% whilst the Small Cap Index added 0.21% to close at 227
289.45 points. Leading the risers pack of the day was Wildale which was up
by 10.01%. BAT added 8.59% and Hippo added 8.57%. Bindura Nickel Corporation
was up by 3.60% to 497.74c. Leading in the shakers' pack were Dairibord
after their proposed merger with Dandiary hit a brick wall and First Capital
Bank which lost 14.55% and 8.48% respectively. Innscor  was down 5.18% to
9036c. Medtech Holdings (MMDZ.zw) and First Mutual Properties shaded 4.38%
and 2.83% respectively. The Old Mutual Top Ten ETF closed at 211.47c down by
1.74% after 354 003 units with a value of ZW$748 617 in 19 trades exchanged
hands.-wealthaccess

Global Currencies & Equity Markets

South Africa

South African rand gains as cautious Fed lifts risk appetite

(Reuters) - The South African rand gained on Monday, boosted along with
other risk-sensitive currencies by investor confidence that the U.S. Federal
Reserve was in no rush to step away from its massive pandemic-era stimulus.

At 1558 GMT, the rand ZAR=D3 traded at 14.6475 against the dollar, roughly
0.6% stronger than its previous close.

Fed Chair Jerome Powell told the Jackson Hole, Wyoming, central banking
symposium on Friday that tapering of stimulus measures could begin this year
but added the Fed would remain cautious.

The rand regularly moves on shifts in expectations for U.S. monetary policy
and global market sentiment.

Budget data showing a slightly smaller deficit in July than the same month
last year did little to influence rand trading.

Later this week, South Africa-focused investors will scrutinise trade
figures ZATBAL=ECI, credit extension numbers ZACRED=ECI and a PMI survey
ZAPMIM=ECI for further clues about the status of Africa's most
industrialised economy.

So far the economic recovery from COVID-19 has been uneven and halting, with
arson and looting linked to the imprisonment of former President Jacob Zuma
detracting from a strong first-quarter performance.

Johannesburg-listed stocks fell on Monday, with the Top-40 Index .JTOPI
closing 1.05% lower at 60,750 points and the broader All-Share Index .JALSH
slipping 0.86% to 67,065 points.

Shares in e-commerce giant Naspers NPNJn.J and internet subsidiary Prosus
PRXJn.J led the decline. Both fell over 3% on the news that China has
forbidden under-18s from playing video games for more than three hours per
week.

The decision hit Chinese internet giant Tencent 0700.HK, in which Prosus
holds a 29% stake.

The benchmark 2030 government bond ZAR2030= gained on Monday, with the yield
dropping 5 basis points to 8.765%.

Nigeria

Nigeria's naira hits record low on black market -traders

(Reuters) - Nigerian naira hit a new record low of 527 against the dollar on
the black market on Monday, days after the central bank banned micro-lenders
from foreign exchange dealing, traders said.

The currency closed at 524 naira at its previous session on Friday. It had
hit a low of 525 naira a month ago after a central bank dollar clamped down
on dollar sales to exchange bureaus, sending the currency tumbling on the
unofficial market.

The central bank banned micro-lenders from foreign exchange dealings seven
days ago due to their level of capital, the latest in a strings of curbs on
the currency market.

Last month, the bank banned dollar sales to exchange bureaus, saying they
had become conduits for graft and illegal money flows.

On Monday, commercial banks quoted the dollar at 413 naira for retail
transactions, around the official rate NGN=, which has been trading within a
range since June.

One trader said the currency bans have drained liquidity from the unofficial
market and that the naira could weaken further on the black market.

Nigeria is battling dollar shortages brought on by low oil prices, following
disruptions linked to the COVID-19 pandemic. The central bank has devalued
the currency three times since March last year, but the naira has continued
to weaken.

 <mailto:info at bulls.co.zw> 

Global Markets

Dollar near 2-week low as investors look to U.S. jobs data

TOKYO (Reuters) - The dollar hovered near two-week lows against a basket of
currencies on Tuesday with trade seen driven by month-end flows as investors
looked ahead to U.S. jobs figures later in the week.

The U.S. currency steadied from falls after Federal Reserve Chair Jerome
Powell on Friday offered no signal on when the central bank plans to cut its
asset purchases beyond saying it could be "this year."

Weaker jobs numbers could instead cement a case for later action - a
pre-announcement in November with a formal decision in December.

Trade on Tuesday, however, is likely to be driven more by month-end flows
from various businesses for their import and export transactions.

In early trade, the euro held firm at $1.1799, near Monday's three-week high
of $1.1810.

The euro zone's consumer price data due at 0900 GMT is expected to show that
inflation in the currency bloc has gathered pace in August.

Sterling fetched $1.3762 while the yen was little changed at 109.98 yen to
the dollar.

The dollar index stood at 92.698, near Monday's two-week low of 92.595.

In Asia, China's official PMI due around 0200 GMT is being closely watched
for clues on the extent of the impact caused by the outbreak of the Delta
variant in the country.

The offshore Chinese yuan stood at 6.4648 per dollar, not far from a
three-week high of 6.4595 touched on Friday.

The Australian dollar, often seen as a proxy bet on the Chinese economy,
stood at $0.7292, having peaked on Friday at $0.7317.

The Canadian dollar fetched C$1.2610, having reached a two-week high on
Monday, thanks in part to the Canadian current account surplus widening more
than expected due to robust oil prices.

Oil prices strengthened to three-week highs as U.S. Gulf Coast platforms,
refineries and pipelines grappled with uncertainty on restart timelines
after Hurricane Ida wreaked havoc on the region. [O/R]

Emerging market currencies also held firm, with the MSCI emerging market
currency index hitting a three-week high of 1,733.33 on Monday. It last
stood at 1,732.54.

In cryptocurrencies, bitcoin eased to $47,626 while ether held slightly
firmer at $3,277.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Copper Price Prediction With Industrial Output Data In Focus

Copper price is hovering below the resistance level of $4.3750 after
entering the overbought zone. While it will likely ease in the immediate
term, its industrial demand is expected to boost it further. In the ensuing
sessions, the focus will be on industrial output data from China and other
economies. Besides, based on the inverse correlation between the US dollar
and most commodities, US consumer confidence and NFP jobs data are bound to
impact the red metal.   

Copper price technical outlook

Copper price has eased below the resistance level at 4.3750 after last
week's gains. On Friday, a decline in the value of the US dollar boosted the
red metal from an intraday low of 4.2210 to 4.3685 earlier on Monday.

At the time of writing, it was up by 0.86% at 4.3555. Since plunging to a
four-and-a-half month low about one-and-a-half weeks ago, it has surged by
about 10%.

On a two-hour chart, the industrial metal is trading above the 25 and 50-day
exponential moving averages with an RSI of 71. Based on both the
fundamentals and technical, I am bullish on the metal. However, having
entered the overbought territory, it will likely ease before resuming its
rally.

In the near term, I expect copper price to continue finding resistance at
4.3750. It will likely hover around that resistance zone before rising
further to 4.4300. Past that hurdle, the path will be clear for the bulls to
push the price further to 4.5000. On the flip side, the pull back may have
it along the 25-day EMA at 4.2745 before bouncing back to the 4.3750
resistance zone.

INVESTORS DIARY 2021

Company

Event

Venue

Date & Time

Counters trading under cautionary

ART

Seed co Int.

Dairibord

Starafrica

Medtech

Turnall

Seed co

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
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whatsoever for any loss howsoever arising from any use of this report or its
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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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