Bulls n Bears Daily Market Commentary : 12 July 2021

Mon Jul 12 15:53:56 CAT 2021

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Bulls n Bears Daily Market Commentary : 12 July 2021

ZSE commentary

The ZSE closed in the positive for the second day registering impressive
gains in all the indices in our review. However, activity levels declined to
455 trades representing a total volume of 2 919 000 shares exchanging hands.
Medtech continued to be the most active stock at 47 trades followed by OK
Zimbabwe and Star Africa with 44 and 39 trades each. The market bias was
positive after 25 stocks registered losses against 10 gainers while 6 of the
active stocks remained unchanged. Delta was the most liquid counter as it
anchored both volume and value aggregate trading over 680 000 shares with a
value of ZW$49.7 million contributing 55.7% to total turnover.

The benchmark All Share Index was up by 2.33% and the Top 10 Index was up
3.85%. The Top 15 Index added 3.16%. The Medium Cap Index traded higher to
16 471.82 points whilst the Small Cap Index was also up to 229 655.24 points
a 5.32% increase from major gains in Zimpapers (13.35%), General Beltings
(9.96%) and Truworths (8.91%). Leading the risers pack of the day were CAFCA
and Zimpapers which added 19.36% and 13.35% respectively. The fast-food
outlet giant Simbisa closed at 4080.49c up by 10.55%. OK Zimbabwe gained
10.03%. General Beltings also added 9.96%. Leading in the shaker's pack was
NMB shading 6.93%. Proplastics  and Dairibord shares were down by 2.01% and
1.73%. First Mutual Properties was down 1.34% to 1433.33c. The Old Mutual
Top Ten ETF closed at 181.06c up by 1.11% from a trade of 3 600 units worth
ZW$6 518 in 5 trades.-wealthaccess

Global Currencies & Equity Markets

South Africa

Rand Slumps With South African Riots Adding to Covid Woes

South Africa's rand slumped to its weakest level against the dollar in more
than two months as rioting that started with last week's arrest of former
President Jacob Zuma spread, weighing on the outlook for an economy already
strained by a resurgence of the coronavirus.

The violent protests shuttered businesses and disrupted transport networks
in the nation's two richest provinces, Gauteng and KwaZulu-Natal. Zuma was
sentenced to 15 months in jail for defying a court order to testify at a
graft inquiry. The riots added to the disruption from a lockdown, extended
by President Cyril Ramaphosa on Sunday night for a further two weeks in an
effort to curb the pandemic.

The rand declined as much as 2% and was 1.7% weaker at 14.4681 per dollar by
2:18 p.m. in Johannesburg, heading for its weakest level since April 30.
One-month implied volatility on the currency pair touched the highest in
almost three weeks.

While the rand remains this year's top emerging-market performer,
strategists have turned more bearish on the currency as a spike in Covid-19
cases keeps expectations for tighter monetary policy at bay. Morgan Stanley
favors long dollar positions against "high-beta" developing-nation
currencies such as the rand. Deutsche Bank AG is advising investors to short
the South African currency against the Russian ruble.

South Africa Riots May Blow Over, But the Damage to Rand Is Done

In the debt market, yields on the most-liquid 2026 government bond climbed
five basis points to 7.49%. The country's risk of default, as measured by
credit-default swaps, headed for its biggest jump since June 23.

Six Killed as South African Riots Spread After Zuma Jailing

The FTSE/JSE Africa All Share Index slid as much as 0.8% on Monday, before
erasing losses on gains in major stocks that benefit from weakness in the
rand. Global luxury retailer Richemont provided the biggest boost to the
market.

Although investors are used to the nation's political volatility, South
Africa is at risk of seeing economic growth of less than 4% year-on-year
because of the intensity of the unrest, said Annabel Bishop, chief economist
at Investec Bank Ltd.

"While these losses are faced by the private sector, the volatile situation,
if not rapidly brought under control will impact investor sentiment soon and
destroy the hard-won gains in the Ramaphosa presidency if it approaches
civil war," Bishop, who is based in Johannesburg, wrote in a note.

African currencies week ahead: Kenyan, Tanzania units to remain steady,
Uganda's shilling up

NAIROBI: The Kenyan and Tanzanian shillings were expected to remain steady
in the coming week against the US dollar, while Uganda's shilling was seen
to be firming.

KENYA - The Kenyan shilling is expected to remain steady due to subdued
demand for dollars amid a slow market, traders said.

At 0615 GMT, commercial banks quoted the shilling at 107.85/108.05, compared
with last Thursday's close of 107.85/108.0.

UGANDA - The Uganda shilling is seen trading with a moderately firming tone
in the coming days as big firms reserve some of the local currency cash to
meet mid-month tax obligations.

At 1028 GMT commercial banks quoted the shilling at 3,540/3,550, compared to
last Thursday's close of 3,555/3,565.

He said the shilling will mostly trade in the 3,520-3,540 range in the
coming days.

NIGERIA - Nigeria's naira is seen range-bound on the spot market in the
coming week on the hope that rising oil prices could boost the country's
foreign exchange supplies in the wake of dollar shortages, traders said.

The currency traded at 410.65 naira on the spot market on Thursday, to stay
within a range of between 407 naira and 412 naira it has traded at since
last month.

However, it remained unchanged on the black market at 503 naira, a more than
three-and-half year low it hit last week on the informal market.

ZAMBIA - The kwacha is expected to continue trading within the same range
with a slight bias towards depreciation against the dollar next week as hard
supply remains tight amid rising demand. On Thursday, commercial banks
quoted the currency of Africa's second largest copper producer at 22.6200
per dollar, almost the same level at which it closed a week ago at 22.6100.

TANZANIA - Tanzania's shilling is expected to hold steady next week with
inflows from agricultural exports balancing the demand for the US dollar
from manufacturing and oil importers.

Commercial banks quoted the shilling at 2,314/2,324, the same levels
recorded a week earlier.

 <https://www.facebook.com/Hyundaizimbabwe/> 

Global Markets

Rupee strengthened 21 paise to 74.43 against US dollar in early trade

The Indian rupee strengthened by 21 paise to 74.43 against the US dollar in
early trade on Monday, tracking a firm trend in the domestic equity market.

At the interbank foreign exchange, the domestic unit opened at 74.49 against
the dollar, then inched higher to 74.43, registering a gain of 21 paise over
its previous close.

On Friday, the rupee had settled at 74.64 against the US dollar.

Meanwhile, the dollar index, which gauges the greenback's strength against a
basket of six currencies, was trading 0.06 per cent up at 92.18.

On the domestic equity market front, BSE Sensex was trading 258.91 points or
0.49 per cent higher at 52,645.10, while the broader NSE Nifty advanced
90.80 points or 0.58 per cent to 15,780.60.

Forex traders said foreign fund outflows and firm crude oil prices could
weigh on investor sentiment and cap the appreciation of the local unit.

Foreign institutional investors were net sellers in the capital market on
Friday as they offloaded shares worth Rs 1,124.65 crore, as per exchange
data.

Global oil benchmark Brent crude futures fell 0.21 per cent to USD 75.39 per
barrel.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold dips on stronger dollar, focus on U.S. inflation data

(Reuters) - Gold prices fell on Monday as a stronger dollar made bullion
more expensive for holders of other currencies, while investors awaited U.S.
inflation data and Federal Reserve Chairman Jerome Powell's testimony this
week.

Spot gold was down 0.4% at $1,800.46 per ounce by 1051 GMT. U.S. gold
futures slipped 0.5% to $1,801.30 per ounce.

The dollar index rose 0.2% against its rivals.

Norman said the gold market lost momentum after the U.S. Federal Reserve
adopted a more hawkish stance, raising prospects for a rise in interest
rates as early as 2023, and a tapering of its monetary stimulus.

Gold prices lost 7% in June following the hawkish tilt from the U.S. central
bank. Even though gold is seen as a hedge against inflation, a Fed rate
increase would increase the opportunity cost of holding bullion.

Investors will focus on a U.S. consumer price index report on Tuesday, and
Powell's testimony before Congress on Wednesday and Thursday for cues on the
timeline for policy tightening.

Economists polled by Reuters expect U.S. consumer price for June to have
risen 0.4% from May and 4.0% from a year earlier after two straight months
of sharp gains in prices.

Offering some respite to gold, an upsurge in new infections caused by the
Delta coronavirus variant capped gains in equity markets.

The near-term trend for gold seems to be biased towards the upside, with the
immediate resistance at $1,815 per ounce and support at around $1,790, said
Margaret Yang, a strategist at DailyFX.

Elsewhere, silver fell 0.6% to $25.93 per ounce, palladium dipped 0.7% to
$2,790.07 per ounce and platinum slipped 0.9% to $1,093.86. 

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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