Bulls n Bears Daily Market Commentary : 02 December 2021

Thu Dec 2 17:30:07 CAT 2021

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Bulls n Bears Daily Market Commentary : 02 December 2021

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ZSE commentary

The ZSE closed in the positive territory in a mixed trading session with low
liquidity and activity levels. Activity levels were at 400 trades. Star
Africa and OK Zimbabwe were the most active stocks at 36 trades each
followed by Cassava and Delta at 34 and 31 trades respectively. Investor
sentiment was negative after the session yielded 16 decliners against 11
risers while six of the active stocks remained unchanged. FBC Holdings
anchored both volume and value aggregate trading 1 528 600 shares with a
value of ZW$50.83 million.

The All-Share Index added 0.53% to close at 10 814.15 points. The Top 10
Index gained 0.91%. The Top 15 Index also gained 0.71%. The Medium Cap Index
was down by 0.40% to 20 323.90 points whilst the Small Cap Index lost 0.51%
to 381 556.89 points. Leading the risers pack of the day was Unifreight
adding 14.58% after releasing itsQ3 trading update. Econet was up by 9.12%.
Bindura added 5.64% and Mashonaland Holdings added 5.23% to 452.50c. Star
Africa  was up by 3.87%. Mitigating the gains were losses in National Tyre
Services and Masimba Holdings which shaded 20.00% and 12.28% to 624c and
5000c respectively. Seed Co was down by 4.83% to 10944.44c. Zimplow and BAT
shaded 1.67% and 1.18% respectively. The Old Mutual Top Ten ETF closed at
501.17c up by 0.23% after 24 626 units traded worth ZW$123 418 in 20
trades.-wealthaccess

Global Currencies & Equity Markets

South Africa

Rand bounces back firmer against the dollar on Thursday

The rand bounced back in early trade on Thursday, after again breaching the
16.00 mark to the dollar in the previous session as the Omicron coronavirus
variant established itself as the dominant strain in South Africa.

At 0630 GMT, the rand traded at 15.9750 against the dollar, 0.47 percent
firmer than its previous close of 16.0500.

Data from South Africa's National Institute for Communicable Diseases showed
on Wednesday that 74 percent of all the virus genomes it had sequenced last
month had been of the new variant, as new cases doubled from Tuesday.

The data also showed that the Omicron variant appeared able to get around
some immunity, but vaccines should still offer protection against severe
disease.

The strain has been found in places as widespread as Australia, Britain,
Canada and Japan, even as those countries rapidly tighten their borders.

REUTERS

Kenya

Shilling drops to a new historic low of 112.83 against US Dollar

Kenyan shilling dropped a new historic low on Wednesday morning before
gaining to Monday's level as the high demand for the greenback by traders
heighten.

The Google currency tracker mapped the shilling at 112.83 a few moments past
9 am before stabilizing to 112. 49 at noon.

The shilling which opened the year at 107.23 has been losing ground against
major world currencies despite numerous support by the Central Bank of Kenya
to iron out volatilities.

By yesterday, the shilling had shed nearly four per cent against the
greenback and 2.7 per cent against the Sterling Pound.

Money markets analysts say the Shilling, just like other currencies are
feeling the heat of global inflation, with strong economies like the US and
UK experiencing the worst cost of living in almost two decades.

The U.S. inflation rate rose to a 13-year high in September as rising costs
for food and shelter pushed the rate up to 5.4 per cent.

In the UK, annual inflation in the U.K. accelerated to its fastest rate in a
decade, hitting 4.2 per cent last month.

Back home, the weak shilling sent September inflation to the roof, hitting
6.9 per cent before easing marginally to 6.45 per cent in October.

On Tuesday, the Kenya National Bureau of Statistics (KNBS) said the cost of
living eased to 5.8 per cent in November on reduced cost of petroleum
products. 

Even so, prices of household products like sugar, maize flour and cooking
oil have risen in recent days as importers pass high currency bills to
consumers. 

The dollar scarcity which is activated by high demand in America and Europe
as traders buy to stock for winter is expected to pile pressure on the cost
of living this festive season in imports-dependent countries like Kenya. 

NCBA Bank chief economist Raphael Agung' said the weak shilling will not
only push up the cost of living but also the debt servicing. 

Even so, CBK insists that the shilling is not out of line with other global
currencies. 

According to CBK Governor Patrick Njoroge, while the shilling has shed three
per cent of its value against the green buck in the year to date, the
Japanese Yen, the Swedish Krona and the Euro have lost ground by 10.3, 9 and
7.9 per cent respectively.

He added that in Africa, the South African rand has shed 7.2 per cent of its
value to the dollar with the Nigerian Naira and the Ghanian Cedi having shed
4 and 4.2 per cent of their values respectively.

The only exception to the trend has been currencies including the Zambian
Kwacha which has gained nearly 20 per cent after 'significant changes to the
country's economy in the past 12 months.

The CBK states that it has held its policy on non-intervention in the
foreign exchange, only stepping in to stamp out volatility which would leave
the economy susceptible to instability.

Zambia

Kwacha projected to post minor losses - Absa Bank

THE Kwacha is projected to post minor losses against the United States (US)
dollar in the short term due to anticipated green back inflows from
corporates making conversions to meet tax obligations.

According to the Absa Bank Zambia Plc's treasury newsletter, the Kwacha held
firm against the US dollar in Tuesday's trading session as importer demand
was evenly matched by inflows from those converting dollars.

 <mailto:info at bulls.co.zw> 

Global Markets

Sterling drifts higher as dollar under pressure; c.bank eyed

(Reuters) - Sterling firmed on Thursday as the discovery of the first case
of the Omicron variant in the United States weighed on the dollar overnight,
but trading was choppy amid uncertainty about whether the Bank of England
will hike interest rates this month.

Currency markets broadly lacked direction with the greenback receding
further from its July 2020 highs. Trade was volatile as daily COVID-19
infections doubled in South Africa, where Omicron has quickly established
itself as the dominant strain. read more

Comments from Fed Chair Jerome Powell on Wednesday that he and his fellow
policymakers will consider at their Dec. 14-15 meeting a faster taper of
stimulus, potentially opening the door to earlier interest rates hikes,
failed to lift the dollar. read more

Closer to home, uncertainty on whether the Bank of England will raise
interest rates also capped the pound's gains.

The BoE said in November it would probably have to raise rates from an
all-time low of 0.1% "over the coming months", but policymakers have sounded
increasingly divided on this prospect after the new coronavirus variant was
detected. read more

Money markets were pricing in only 8 bps of rate hikes by the next meeting
on Dec. 16 compared to 12 bps at the beginning of last week.

Sterling edged 0.2% higher to $1.3307 after hitting a fresh 2021 low of
$1.3195 on Tuesday. Against the euro, the pound rebounded from a two-week
low by a similar margin to stand at 85.10 pence.

The Thomson Reuters Trust Principles.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Copper retreats as Codelco warns of lower prices

(Reuters) - Copper prices lost steam on Wednesday after the world's biggest
producer Codelco warned of lower prices and surpluses, reviving worries
about weak demand from top consumer China.

Prices were firm most of the day as worries eased about the spread of the
Omicron coronavirus variant.

But prices went into the red in the afternoon after the CEO of Chile's
Codelco forecast a price decline of up to 9% next year, saying the market
would see surpluses until 2024. read more

Three-month copper on the London Metal Exchange had slipped 0.3% to $9,416 a
tonne by 1730 GMT, having earlier touched an intraday peak of $9,600.

Metals had benefited from investors' increased risk appetite, which sent
stock markets surging, using a dip in prices to bet that the latest COVID-19
variant would not derail the economic recovery, while oil also rallied.

* Arbitrage activity with China was supporting LME nickel, Al Munro at
broker Marex said in a note. Nickel rose 0.1% to $19,925 a tonne.

* Chile's Senate pushed forward discussion over a controversial bill to
increase royalty payments from mining companies that operate in the world's
largest copper producer. The proposed legislation is backed by opposition
lawmakers.

* LME cash aluminium traded at a $16.25-a-tonne premium over the three-month
contract , indicating tight nearby supplies, as LME aluminium stocks fell to
a 14-year low of 893,775 tonnes.

* COLUMN-Carbon brakes aluminium supply response to booming prices. read
more

* LME aluminium gained 1.1% to $2,653.50 a tonne, lead added 0.6% to $2,289,
tin advanced 0.8% to $39,325, but zinc slipped 0.9% to $3,170.50.

INVESTORS DIARY 2021

Company

Event

Venue

Date & Time

National Unity Day

December 22

Christmas Day

December 25

Boxing Day

December 26

Public Holiday in lieu of Boxing Day falling on a Sunday

December 27

Counters trading under cautionary

ART

Seed co Int.

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
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