Bulls n Bears Daily Market Commentary : 04 February 2021

Thu Feb 4 16:05:16 CAT 2021

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Bulls n Bears Daily Market Commentary : 04 February 2021

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

ZSE commentary

The All Share Index appreciated 4.01% to close at 3905.77 points. The Top 10
Index and the Top 15 Index registered 4.37% and 4.39% gains respectively.
The Medium Cap Index was up by 3.31% while the Small Cap index went up by
1.53% by close of trading. The ZSE market capitalization was at ZWL$466.84
billion as it rallies to hit the $500 billion mark.

Gains for the day were registered in Proplastics and Unifreight  which
strengthened by 19.88% to close at 1990c and 19.81% to close at 95.25c
respectively. Ariston   added 19.12% to close at 223.83c and Art  settled at
500c after gaining by 18.52%. Gains were offset by marginal losses recorded
in Dawn  which closed the day at 41.25c following a decrease of 4.82% and
CBZ shaded 1.30% to 10254.59c. Other losses were also recorded in Masimba
which edged down by 1.21% to 1630c, while the FBC  shaded 0.58% to 2485.53c
and Medtech was 0.41% down to 7.37c. On the ETF market, the Old Mutual TOP
10 fund saw 21 trades valued at ZWL$3,167,392 from 1 988 995 units traded.
This led to a gain of 6.16% to 159.25c as the top 10 index gained 4.37%.

Total turnover was at ZW$105,863,138.80 in 453 trades. Ariston was the most
active with 33 trades. The market breath was positive after 25 stocks
appreciated while 7 depreciated. Total trades were 453 with 5 counters
remaining unchanged and 14 with zero.-wealthaccess

Global Currencies & Equity Markets

South Africa

Rand runs out of momentum overnight

JOHANNESBURG - The rand remained on the front foot as risk-on trade gathered
momentum with the open of trading in London and Europe according to NKC
Research.

South Africa's Department of Public Enterprises indicated on Wednesday that
national carrier SAA may exit administration later this month, while a
decision on an equity partner may be made by end-March after numerous
potential partners submitted expressions of interest.

At the close of local trade, the rand quoted 0.10 percent firmer at
R14.96/$, after trading in range of R14.89/$ - R15.03/$. The rand ran out of
momentum overnight. The expected range of the rand against the dollar today
is R14.90/$ - R15.20/$.

South African bourse

The JSE All Share (+0.44 percent) ended in positive territory thanks to
gains in most subsectors, apart from large gold mining stocks (-0.11
percent). In the overall emerging market sphere, the MSCI Emerging Market
Index (-0.89 percent) traded lower.

Brent crude oil

The Brent oil price extended gains yesterday following an unexpected
drawdown in US crude stockpiles. Market sentiment was further boosted by
news that Democrats were preparing the process to pass US President Joe
Biden's $1.9 trillion Covid-19 relief plan.

At the close of local trade, benchmark Brent crude futures quoted 1.0
percent higher at $58.02pb. Crude prices traded firmer during Asian trade
this morning.

BUSINESS REPORT ONLINE

Zambia

Zambian Currency's 42-Day Losing Streak Not About to End

The Zambian kwacha's 42-day record losing streak against the dollar is set
to continue until the government deals with its $12 billion of external
debt, despite official attempts to support the beleaguered currency,
according to StoneX Group Inc.

A copper price that has climbed to almost eight-year highs has failed to
stem the tide after Africa's second-biggest producer of the metal became the
continent's first pandemic-era default. It failed to make a $42.5 million
payment on a $1 billion Eurobond in November, and the government stopped
servicing most external commercial debt.

The currency has weakened 9% against the dollar since September, but its
depreciation has been more gradual this year after the government introduced
regulations limiting dollar pricing variance for banks.

The Bank of Zambia has much greater control of the foreign-exchange market
after legislation was introduced requiring mining companies, which account
for more than 70% of export earnings, to pay taxes and royalties in dollars
directly to the central bank.

Still, foreign exchange reserves have continued to slide and reached a
near-record low of $1.28 billion by the end of October, according to the
latest data from the central bank. Continued kwacha weakness will place
further pressure on inflation that's already breached 20%, and on the
nation's debt metrics.

The country is scheduled for talks with the International Monetary Fund from
Feb. 11 to March 3, and an agreement is crucial as holders of $3 billion in
Eurobonds have demanded a deal with the Washington-based lender as a
condition for agreeing to a restructuring of the debt. That's unlikely to
happen before elections scheduled for August.

The Bank of Zambia will continue to use all monetary and foreign-exchange
intervention options to manage the volatility of the kwacha, Finance
Minister Bwalya Ng'andu told lawmakers Tuesday in Lusaka, the capital. It's
also working with commercial lenders to increase liquidity in the
foreign-exchange market, and changed rules to avoid volatility fueled by
speculation, he said.

 <mailto:info at bulls.co.zw> 

Global Markets

Dollar strengthens on U.S. economic outlook; euro dips below $1.20

LONDON (Reuters) - The dollar strengthened to two-month highs and the euro
dropped below $1.20, as data pointed to an improvement in the U.S. economic
outlook, bond yields rose and oil prices hit a one-year high.

U.S. Treasury yields ticked up after ADP payroll data showed an increase in
employment on Wednesday and ISM data showed services industry activity in
the United States rose to its highest in nearly two years in January.

Bullish comments from U.S. Federal Reserve policymakers and renewed hopes
for U.S. fiscal stimulus are also lending new impetus to reflation trades.

The Democratic-controlled U.S. House of Representatives approved a budget
outline on Wednesday that would allow them to pass President Joe Biden's
proposed $1.9 trillion coronavirus aid plan without Republican support.

The U.S. dollar rose to as high as 91.485 against a basket of currencies,
its strongest in two months.

Dollar shorts are elevated, meaning that the dollar has room to rise when
speculators quit those positions.

Versus the yen, the dollar hit its highest in nearly three months, with the
pair changing hands at 105.285 at 1127 GMT.

The euro fell below $1.20 for the first time since Dec. 1, and was down 0.3%
on the day at $1.1994.

In the UK, the Bank of England's meeting is in focus. Although no changes to
monetary policy are expected, investors will be listening for comments on
the economic recovery and the outcome of the bank's consultation on negative
rates.

Businesses in Britain have been hobbled by a third national lockdown and are
also grappling with post-Brexit barriers to trade with the European Union
after Britain left the bloc's single market on Dec. 31.

The pound was slightly lower against the euro and down 0.5% against the
dollar at $1.3576 -- a 17-day low.

Elsewhere, the Australian dollar was little changed at 0.76215 versus the
U.S. dollar. The Norwegian crown was down around 0.4%.

Bitcoin continued to climb, touching a 20-day high in early trading.
Ethereum reached record highs above $1,600.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold and silver retreat as dollar gains upper hand

(Reuters) - Gold and silver slipped on Thursday as the dollar and U.S.
Treasury yields gained and markets awaited clarity on U.S. fiscal stimulus
measures.

Spot gold XAU= dropped 0.9% to $1,818.00 an ounce by 1307 GMT after touching
a two-month low. U.S. gold futures GCv1 fell 1% to $1,817.20.

Silver XAG= , meanwhile, slipped 1.2% to $26.54.

Silver prices have declined more than 12% since a GameStop-style retail
frenzy sent them to their highest in nearly eight years at $30.03 on Monday.
is also under pressure from the technical side," said Commerzbank (DE:CBKG)
analyst Daniel Briesemann. "It dropped below the 200-day moving average,
which triggered technical follow-up selling. If it goes below the $1,800
mark ... we might see gold lower in the short-term."

U.S. yields and a firmer dollar also pressured precious metals.

Making bullion more expensive for those holding other currencies, the dollar
.DXY scaled a two-month peak, while U.S. 10-year Treasury yields were at a
more than three-week high. US/ USD/

Gold is considered a hedge against inflation from large stimulus measures,
but higher yields challenge that status because they increase the
opportunity cost of holding non-yielding bullion.

Investors also focused on a $1.9 trillion U.S. coronavirus aid plan passed
by the U.S. House without Republican support. biggest risk to gold is
stronger recovery as vaccines roll out, to the extent that we see U.S. bond
yields rally," said Lachlan Shaw, National Australia Bank's head of
commodity research.

However prices could remain supported if the rollout faces uncertainty
because of emerging virus variants, he added.

In other precious metals, platinum XPT= fell 1.3% to $1,087.22 an ounce and
palladium XPD= lost 0.3% to $2,267.99.

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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DISCLAIMER: This report has been prepared by Bulls 'n Bears, a division of
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subscribe for any securities. The information contained in this report has
been compiled from sources believed to be reliable, but no representation or
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opinions expressed and recommendations made are subject to change without
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