Bulls n Bears Daily Market Commentary : 22 January 2021

Fri Jan 22 15:56:53 CAT 2021

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Bulls n Bears Daily Market Commentary : 22 January 2021

ZSE commentary

The All Share Index appreciated 6.58% to close at 3171.15 points. The Top 10
Index and the Top 15 Index registered 7.86% and 6.95% gains respectively.
The Medium Cap Index gained 4.03% while the Small Cap index appreciated by
2.45% by close of trading. The ZSE market capitalization was at ZWL$376.91
billion. Gains for the day were registered in Unifreight and Truworths
which strengthened by 19.96% to close at 26.75c and 19.88% to close at 48c
respectively. Mash holdings added 19.81% to close at 96c and First Capital
Bank  settled at 125.77c after gaining by 19.50%. Gains were offset by
losses recorded in Cafca  which closed the day at 8000c following a decrease
of 11.11% and Bindura  which shaded 6.71% to 371.56c. Marginal losses were
also recorded in Dawn properties which edged down by 2.36% to 55c, while the
top listed hoteliers RTG  shaded 2.30% to 187.34c and African Sun  was 0.72%
down to 145.76c.

On the ETF market, the Old Mutual TOP 10 fund saw 26 trades valued at
ZWL$5,462,504 from 4 472 920 units traded. This led to a gain of 11.02% to
122.12c. Total turnover was at ZW$66,156,298.06 in 371 trades. Delta was the
most active with 33 trades. The market breath was positive after 30 stocks
closed in the green while 5 traded lower. Total trades were 371 with 5
counters remaining unchanged and 11 with zero volume. -wealthaccess

Global Currencies & Equity Markets

South Africa

South Africa's rand weaker as risk rally fades

JOHANNESBURG (Reuters) - South Africa's rand was weaker early on Friday, as
a rally in riskier assets driven by hopes of U.S. economic stimulus faded.

At 0708 GMT, the rand traded at 15.0550 versus the dollar, 0.7% weaker than
its previous close.

The decline was in line with other emerging market currencies like the
Russian rouble and Turkish lira.

The rand has mainly moved on global factors recently, shrugging off a series
of poor domestic data releases that point to lingering weakness in Africa's
most industrialised economy.

This week, retail sales and mining figures for November came in worse than
expected.

On Thursday, the central bank kept its main lending rate unchanged,
providing some support to the currency.

But analysts at Commerzbank said the rand remained vulnerable, after rising
significantly in the last few months of 2020.

Government bonds also fell early on Friday, as the yield on the benchmark
2030 instrument increased 3 basis points to 8.75%.

Nigeria

Naira rises against dollar at official market

Naira strengthened against the U.S. dollar on Thursday at the Investors &
Exporters (I&E) window of the foreign exchange market, data from the FMDQ
Security Exchange where currencies are officially traded showed.

At the Thursday trading session, Naira closed at N394.00. This represents
N0.17 or 0.04 per cent increase over the rate at which it was traded at the
previous session, which was N394.17.

The local unit's appreciation in value came as turnover contracted by 13.9
per cent with $77.04 million recorded compared to the $89.5 million posted
on Wednesday.

The domestic currency saw an intraday high of N390 and a low of N415.76
before closing at N394.00.

Meanwhile, at the black market, data from abokiFX.com, a website that
collates parallel market rates in Lagos, showed naira to dollar exchange
rate at N475, which has remained without movement since the week began.

That leaves the spread of N81 between the unofficial and the official rates,
which translates to a 20.6 per cent disparity.

Experts say the gap between the rates have widened significantly on account
of decline in revenue from oil, Nigeria's main export triggered by the
upsurge of the coronavirus pandemic.

The CBN's official rate on Thursday was N379 per dollar.

 <mailto:info at bulls.co.zw> 

Global Markets

Dollar inches up after three-day losing streak; risk currencies fall

The dollar edged slightly higher on Friday after three straight days of
losses, and riskier currencies fell, as bleak economic data gave global
equity markets reason to pause after another week of record highs.

The dollar had fallen against a basket of currencies for the past three
sessions as market optimism about U.S. President Joe Biden's fiscal stimulus
plans prompted traders to seek riskier assets, producing gains in riskier
currencies such as the New Zealand and Australian dollar.

But that trend paused on Friday as market sentiment pulled back, global
shares slipped off record highs and the U.S. dollar steadied, up less than
0.1% on the day at 90.147 at 1206 GMT.

The dollar index was still on track for its biggest weekly loss since
mid-December.

The Australian dollar fell after disappointing retail sales data, but was
still set for a weekly rise. At 1214 GMT, it was down 0.7% on the day at
0.7711.

The New Zealand dollar was down around 0.6% at 0.7178 versus the U.S.
dollar.

Gloomy economic data did little to brighten the mood, as UK data showed
British retailers struggled to recover in December.

Economic activity in the euro zone shrank markedly in January as stringent
lockdowns to contain the coronavirus pandemic hit the bloc's dominant
service industry hard.

Data from Japan overnight showed that factory activity slipped into
contraction in January and the services sector was more pessimistic as
emergency measures to combat a COVID-19 resurgence hit sentiment.

At 1219 GMT, the euro was flat on the day against the dollar, at $1.2172.

The euro appreciated somewhat on Thursday after the European Central Bank's
policy rate announcement, as the bank said it may not need to use its full
asset-purchase envelope.

President Christine Lagarde also said that the bank was "very carefully"
monitoring the euro exchange rate.

The Norwegian crown was hurt by lower commodity prices, down more than 1%
against the euro at 10.3275.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Oil Drops With Spread of Demand Pessimism and Firmer Dollar

Oil fell near $52 a barrel as pessimism over demand spread with the
coronavirus forcing more lockdowns, while a stronger dollar reduced the
appeal of commodities priced in the currency.

Consumption remains precarious with parts of Hong Kong being locked down,
some Shanghai residents banned from leaving the city and the U.K. prime
minister signaling restrictions in the country may last for months. Traffic
in New York reduced from a month earlier.

Despite the concerns over day-to-day demand, physical crude buying for the
coming months has firmed in recent days. A flurry of purchases by Chinese,
Indian and Thai refiners have supported prices while key swaps tied to the
North Sea market are at the strongest level in 10 months. That's keeping the
futures curve in a bullish structure known as backwardation.

Nearest crude timespreads are in bullish backwardation structure

While crude has turned lower this week, its still trading near the highest
level in almost a year. Investors have flocked back to commodities as frigid
winter and hopes of a big economic stimulus from U.S. President Joe Biden
have supported buying interest. Saudi Arabia's unilateral output cut also
eased oversupply concerns, helping reshape the oil futures curve.

PRICES

West Texas Intermediate for March delivery fell 2.3% to $51.90 a barrel as
of 10:42 a.m. London time

Brent for March settlement lost 2.2% to $54.89

The Biden administration's initial steps -- including the suspension of the
sale of oil and gas leases on federal land, a focus on fiscal spending and a
likely delay in lifting sanctions on Iran --- may help tighten the oil
market this year and next, Goldman Sachs Group Inc. said in a note. A
speedier vaccine rollout could also boost jet fuel demand, it said.

Iran, meanwhile, has started ramping up its oil production and expects to
reach pre-sanctions levels in one to two month, said Deputy Oil Minister
Amir Hossein Zamaninia. The market will be able to accommodate the country's
maximum output of around 3.9 million to 4 million barrels a day, he said.
But risks for any buyer remains as long as U.S. sanctions are in place.

OTHER OIL-MARKET NEWS

It may be the oil market's worst-kept secret: millions of barrels of
Venezuelan heavy crude, embargoed by the U.S., have been surreptitiously
going to China.

Saudi Aramco excludes greenhouse gas emissions generated from many of its
refineries and petrochemical plants in its overall carbon disclosures,
according to a review of public filings by Bloomberg Green.

Libya is seeking funding from foreign oil companies to fix its ailing
infrastructure after years of war and neglect, the nation's top energy
official said.

.

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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