Bulls n Bears Daily Market Commentary : 05 May 2021

Thu May 6 06:30:39 CAT 2021

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Bulls n Bears Daily Market Commentary : 05 May 2021

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

ZSE commentary

The ZSE rose for the second day in May but liquidity was limited as to make
the session unimpressive. Turnover dropped 24.95% to ZW$50.72 million from a
trade of over 3.06 million shares which exchanged hands in 374 trades.
Cassava was the most active stock at 31 trades followed by First Capital
Bank and Econet. The market breadth was positive after 20 stocks appreciated
against 14 that depreciated in a total of 39 stocks which traded. Bindura
was the most liquid counter as it anchored volume aggregates trading 632 600
million shares and Cassava anchored the value aggregate with a value of
ZW$7.83 million.

The benchmark All Share Index was up 0.63% and the Top 10 Index was up by
0.84% with a month to date gain of 1.08%. The Top 15 Index added 0.74%. The
Medium Cap Index traded higher to 11 332.73 appreciating by 0.36%, whilst
the Small Cap Index shaded a marginal 0.76% to close at 42 484.11. Leading
the risers pack of the day was Wildale which added 8.08%. Ariston added
5.00% to 210c. First Capital Bank was 4.44% up to 250.88c. Meikles added
2.94% to 6171.02c. The property firm Mashonaland Holdings appreciated by
2.82%. Leading in the shakers pack was Zimpapers which pared 6.98% to a
yield to date of 89.08% followed by First Mutual Properties shading 2.78%.
the hospitality groups African Sun and RTG pared 2.77% and 2.28%
respectively. Please find a summary of the market activity as shown below;
The Old Mutual Top Ten ETF closed at 176.88c up 0.06% after 12 900 units
with a value of ZW$22 817 in 7 trades exchanged hands.

wealthaccess

 <mailto:info at bulls.co.zw> 

Global Currencies & Equity Markets

South Africa

South African rand gains as dollar eases, Magashule suspended

JOHANNESBURG, (Reuters) - The South African rand gained on Wednesday
afternoon, as the U.S. dollar eased off a more than two-week high hit
earlier in the day and local media reported that the governing party had
suspended one of its top officials, Ace Magashule.

At 1656 GMT the rand ZAR=D3 traded at 14.3700 against the dollar, 0.6%
stronger than its previous close.

The dollar .DXY slipped back after some softer-than-expected U.S. economic
data that prompted traders to consolidate positions ahead of a jobs report
due at the end of the week.

Reports that the African National Congress had suspended corruption-charged
Magashule supported the rand, as the move is seen as a sign of President
Cyril Ramaphosa's growing control over his divided party. Magashule denies
wrongdoing.

Investor attention will soon turn to a scheduled review of South Africa's
sovereign credit by Moody's on Friday. The rating agency already assigns a
"junk" status to the country, but with a negative outlook there is the
potential for a further downgrade.

Government bonds were little changed on Wednesday, with the yield on the
instrument due in 2030 ZAR2030= down 1 basis point at 9.11%.

Johannesburg-listed shares strengthened alongside global equities.

Among gainers, mobile operator MTN Group MTNJ.J closed 11.53% stronger after
posting a near 18% jump in first-quarter revenue.

The Johannesburg Stock Exchange's All-share index .JALSH closed up 1.77% at
67,346 points, and the blue-chip index .JTOPI rose 1.92% to 61,536 points.

Nigeria

Naira gains at official market

Naira strengthened slightly against the U.S. dollar at the I&E window of the
foreign exchange market on Wednesday, data posted on the FMDQ Security
Exchange window where forex is officially traded showed.

The currency closed at N410.50 at the trading session of the NAFEX window on
Wednesday, this represents N0.50 or 0.12 per cent increase from N411.00, the
rate it traded in the previous session on Tuesday.

This became evident as foreign exchange supply soared significantly. The
forex turnover increased by 305.07 per cent, with $172.52 million recorded
as against the $42.59 million posted in the previous session on Tuesday.

Naira experienced an intraday high of N400.00 and a low of N420.50 before
closing at N410.50 on Wednesday.

The last time the domestic currency closed at N410.00 and above was on April
26 last week.

However, the domestic currency remained unchanged against the U.S. dollar at
the unofficial market on Wednesday, data posted on abokiFX.com, a website
that collates parallel market rates in Lagos showed.

Data posted showed that the naira again closed at N485.00 at the black
market, the same rate it has been exchanging hands with the greenback since
April 22.

As a result of this, the spread between the parallel market and the official
market exchange rate is pegged at N74.50 which translates to a gap of 15.36
per cent.

 <mailto:info at bulls.co.zw> 

Global Markets

Dollar holds near two-week high, U.S. jobs data eyed for Fed clues

TOKYO (Reuters) - The dollar hovered below a two-week high on Thursday,
consolidating ahead of a key U.S. jobs report that may provide clues on when
the Federal Reserve will dial back monetary stimulus.

The greenback has rebounded from a one-month low over the past week, swung
by U.S. economic data that has largely supported the case for a rapid
recovery from the pandemic, with traders weighing whether a lift in
inflation may force the Fed's hand earlier than policymakers have so far
suggested.

The dollar index, which measures the U.S. currency against six major peers,
was little changed at 91.316 on Thursday, after rising as high as 91.436 in
the previous session for the first time since April 19. It had dipped as low
as 90.422 on April 29.

With several forecasters predicting a one-million-plus increase in nonfarm
payrolls, "the USD may continue to find a good level of support in the
near-term," with the currency strengthening to $1.19 per euro over a
one-month horizon, she said.

The euro traded at the psychologically important $1.20 mark on Thursday,
after dipping to $1.1986 on Wednesday for the first time since April 19.

The dollar bought 109.34 yen, consolidating after rallying as high as
109.695 on Monday, a level not seen since April 13.

So far, Fed Chair Jerome Powell has argued the labour market is far short of
where it needs to be to start talking of tapering asset purchases. The
central bank has said it will not raise its benchmark Fed funds rate through
2023.

Three Fed officials spoke on Wednesday, with Chicago Fed President Charles
Evans saying that while he was more optimistic about U.S. growth than he was
a few months ago, he expects monetary policy to stay super-easy for some
time.

Boston Fed President Eric Rosengren said inflation will be temporarily
distorted this spring as the U.S. economy works through imbalances caused by
the pandemic but the pressures should be short-lived and should not lead to
a pullback in monetary policy.

Cleveland Fed President Loretta Mester said more progress will be needed in
the job market before the Fed's conditions for reducing its extensive
support will be met.

The dollar bounced on Tuesday after Yellen said rate hikes may be needed to
stop the economy from overheating, though she later downplayed the immediacy
of tightening.

The commodity-linked Canadian dollar traded at C$1.2268 per greenback after
hitting a three-year high of 1.2252 on Wednesday, helped by higher crude
prices and optimism over the global economic recovery.

Sterling was little changed at $1.3904, consolidating around that level over
the past two weeks with the Bank of England expected by some forecasters to
announce a tapering of its bond-buying programme at a meeting later
Thursday, after vaccinations bolstered Britain's economic recovery.

In cryptocurrencies, ether traded at $3,462.62 after reaching a record
$3,559.97 on Tuesday, the ninth straight day to mark an all-time high.

Bigger rival bitcoin was around $56,755, vacillating between around $59,000
and $52,000 in recent days. It marked a record high at $64,895.22 in
mid-April, but then lost momentum, slumping as low as $47,004.20 toward the
end of that month.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold price inches higher as US yields retreat

Gold prices inched higher on Wednesday as US Treasury yield retreated from a
session high while the dollar hovers near a two-week peak.

Spot gold saw a slight gain of 0.2% to $1,783.87 per ounce by 1 p.m. ET. US
gold futures rose 0.4% to $1,783.90 per ounce in New York.

Higher yields threaten gold's appeal as an inflation hedge as they increase
the opportunity cost of holding bullion, which pays no interest.

On Wednesday, US Treasury Secretary Janet Yellen initially said rate
increases may be needed to stop the economy overheating as President Joe
Biden's spending plans boost growth, but later downplayed the remarks and
said she saw no inflation problem brewing, the Financial Post reported.

Elsewhere, palladium fell 0.4% to $2,975.45 per ounce after hitting an
all-time high of $3,017.18 in the previous session, driven by concerns of a
shortage of the metal.

Silver Pulls Back to 50 EMA Only to Find Buyers

The silver markets pulled back a bit during the course of the trading
session on Wednesday to reach down towards the 50 day EMA.

Silver markets have rallied a bit during the course of the trading session
after initially falling on Wednesday to find the 50 day EMA important enough
to hang onto. The 50 day EMA sits at the $60 level, so that of course comes
into focus as well. It is an area that has been supportive for a couple of
weeks now, and it certainly looks as if silver is trying to stabilize
currently. With that being the case, I like the idea of buying dips, but I
recognize it is probably going to take a while to get to where we are going.

If we did break down below the 50 day EMA, I think that the 200 day EMA then
comes into focus, currently sitting at the $24.50 level. We also have the
psychological barrier in the form of the $25 level, so I do think that in
general we continue to find value hunters, but this is based upon the
reopening trade, and not so much the US dollar as of late. In other words,
it does have a fundamental catalyst to go looking towards the $28 level, but
it is going to be a grind more than anything else. Because of this, I think
you should keep your position size relatively small and billed as the trade
goes in your favor. Shorting is not something I am interested in doing
currently.

INVESTORS DIARY 2021

Company

Event

Venue

Date & Time

FCB

AGM 

virtual

06/05/21 : 3pm

NMB

AGM

virtual

1205/21 :  3:30pm

Africa Day

25/05/21

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
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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