Bulls n Bears Daily Market Commentary : 14 May 2021

Sat May 15 07:34:09 CAT 2021

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Bulls n Bears Daily Market Commentary : 14 May 2021

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

ZSE commentary

The ZSE shares rally strongly as institutional investors embrace the price
strength and the market firms above the new record high. Heavyweight
counters dominated turnover closing in today's session at ZW$162.4 million
(31.15% lower) from a trade of over 11.1 million shares. Star Africa was the
most active stock at 39 trades followed by Padenga and OK Zimbabwe. The
market breadth was positive after 34 stocks appreciated against 5 that
depreciated in a total of 41 stocks which traded. Medtech was the most
liquid counter as it anchored volume traded at 4 976 200 shares and Delta
anchored value aggregate a value of ZW$87.16 million.

At close, all the major indices trended upwards, the benchmark All Share
Index gained 5.05% and the Top 10 Index was up by 5.52%. The Top 15 Index
added 4.80%. The Medium Cap Index traded higher to 13 264.23 points
appreciating by 4.54% with a month to date gain of 15.93%. The Small Cap
Index also added 2.47% to close at 49 596.70 points.

Leading the risers pack of the day was Get Bucks Microfinance up by 19.70%
followed by Axia Corporation which added 19.58%. OK Zimbabwe added 17.76% to
2063.38c. First Mutual Properties was 17.70% up to 800.35c. Bindura added
17.06% to 599.52c. Leading in the shakers pack was General Beltings which
pared 7.27% followed by FBC Holdings shading 5.01%. NMB and Unifreight pared
1.70% and 0.59% respectively. Please find a summary of the market activity
as shown below; The Old Mutual Top Ten ETF closed at 175.83c up 0.77% after
136 749 units with a value of ZW$240 447.25 in 11 trades exchanged
hands.wealthaccess

 <mailto:info at bulls.co.zw> 

Global Currencies & Equity Markets

South Africa

South Africa's rand firmer as U.S. Fed stance supports risk demand

South Africa's rand firmed on Friday as global risk demand was aided by
signs the United States central bank would keep lending rates low despite
rising inflation.

A Federal Reserve official this week said the surprise jump in consumer
inflation had not dented its plans to keep its support for the economy.

At 1440 GMT the rand was 0.02% firmer at 14.1350 per dollar, compared to an
overnight close of 14.1375.

The rand, which hit a 16-month high on Tuesday, has had a strong run since
March, prompted by lower rates in the developed world, a surge in global
commodity prices and signs the local economy is on track for a
better-than-expected recovery.

But rising bonds yields in the United States have put a lid on those gains,
while traders have pointed to seasonal factors that often see the rand lose
ground to the dollar around this time of year.

In a poll by Reuters this week, all 25 of economists surveyed see the
Monetary Policy Committee (MPC) of South Africa's Reserve Bank (SARB)
keeping its repo rate unchanged for a fifth straight meeting at a record low
3.5% next week. read more

Investors on the Johannesburg Stock Exchange (JSE) calmed on Friday and
picked up shares in a range of locally sensitive stocks such as banks,
financials, real estate and retail.

The benchmark all-share index (.JALSH) closed up 0.65% at 66,598 points
while the blue-chip index of top 40 companies (.JTOPI) ended up 0.6% at
60,573 points.

Bonds firmed, with the yield on the benchmark 2030 paper down 7 basis point
at 9.10%.

Our Standards: The Thomson Reuters Trust Principles.

Nigeria

Nigeria lets naira weaken in possible move to unify exchange rates

Nigeria let the naira weaken to a record low against the dollar on the
official market on Friday, according to traders, who said this could be a
move by the central bank to unify multiple exchange rates.

Having traded within a band of 380 and 381 to the dollar since July last
year, the naira hit a record low of 419.75 against the dollar on Friday. It
then closed at 411.25 -- the last closing rate for the naira on the
over-the-counter spot market .

The central bank did not respond to calls for comment and no quotes have
been available on the naira's official rate since Tuesday.

It weakened further on the black market, traders said. .

Nigeria operates multiple currency regimes, which frustrate businesses and
have prompted calls from the World Bank for the rates to be unified to
attract investment.

Rising dollar demand has put pressure on the naira as providers of foreign
exchange, such as offshore investors, exited after the COVID-19 pandemic
triggered a fall in global oil prices.

Central Bank Governor Godwin Emefiele in February said the currency was
trading at 410 naira on the official market while the government has been
using that rate for its business as it tries to boost earnings from crude
sales, its main export. 

The World Bank has linked approval of a $1.5 billion budget support loan to
currency reforms.

The central bank had been trying to unify the rates and boost the dollar
supply through direct interventions. It revised the futures rate on the
naira upwards last month to ease pressure on the currency after quoting the
150-day futures contract at 435.81 naira, in its first dollar sales to
foreign investors this year.

The bank is due to hold its interest rate setting meeting later this month
with economic data on inflation and first quarter growth figures expected
from next week.

It has kept rates on hold to support the economy hobbles by lower oil prices
and impact of COVID-19 pandemic but dollar shortages have been contributing
to rising inflation, a key source of concern for the central bank.

Our Standards: The Thomson Reuters Trust Principles.

 <mailto:info at bulls.co.zw> 

Global Markets

Dollar lower after weak data, as inflation fears ease

The dollar edged lower against major currencies on Friday after U.S. retail
sales unexpectedly stalled in April and as concerns about prospects of
accelerating inflation receded.

The greenback <=USD> was down half a percent against a basket of currencies
at 90.317, retracing most of the gains made earlier this week after data
showed a surprise surge in consumer prices.

The Commerce Department said on Friday that retail sales were unchanged in
April after a 10.7% surge in March, boosted by stimulus checks. But another
acceleration in retail sales appears likely in the coming months as the U.S.
economy reopens and Americans spend the savings they have been amassing.
read more

Friday's drop erased some of a two-day rally in the dollar after data on
Wednesday showed U.S. consumer prices increased by the most in nearly 12
years. While the Fed has pledged to keep interest rates low even as
inflation rises, some in the market have bet that the Fed will be forced to
act sooner than expected, making the dollar more attractive.

The combination of weak economic data - last week's non-farm payrolls report
and retail sales on Friday - and evidence of stronger inflation has meant
that the dollar has struggled to make much headway, wrote Jonas Goltermann,
senior economist at Capital Economics.

The euro was among the gainers against the dollar on the day, up 0.53% at
$1.214. Wall Street also bounced back on Thursday and Friday after falling
earlier in the week. The return of risk appetite that bolstered U.S. stocks
also helped to support the euro.

The pound gained roughly 0.80% this week on bets of a strong economic
recovery in Britain and expectations that any Scottish independence
referendum could be a ways off.

In cryptocurrencies, Bitcoin has dropped more than 13% this week after Tesla
boss Elon Musk said he would stop accepting the token as payment over
environmental concerns. It was moderately stronger on Friday, up 1.70% at
$50,517.66.

Our Standards: The Thomson Reuters Trust Principles.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold Prices Maintain Traction as Economies Begin Recovery

PRNewswire/ -- Gold prices breached the USD 1,800 mark earlier this month,
for the first time since February. Despite the recovering economy and lower
number of COVID-19 cases in the U.S., the government is still injecting
liquidity into the financial system, as fiscal and monetary stimuli are
being implemented. These measures, which are meant to help bring the economy
back to pre-pandemic highs, have consequences, specifically the devaluation
of the dollar and inflation. 

In a report by Kitco, Gary Wagner, editor of TheGoldForecast.com, explained
that he believes that "we will see a new all-time record high in gold. I'm
not optimistic as to believe it will happen, let's say, over the next four
months. However, I think it's highly likely, based on certain parameters,
that we do test $1,900 once again, and that could be over the next couple of
months." Gold Mountain Mining Corp.  Golden Star Resources Ltd.  , Equinox
Gold Corp. B2Gold Corp. , IAMGOLD Corporation 

The economic conditions seem to be appropriate for gold, with various news
reports around the world indicating strong demand for the yellow metal. For
example, last month, Hungary's central bank increased its gold reserves to
94.5 metric tons from 31.5 tons, citing "long-term national and economic
policy strategy objectives." Additionally, New York City real estate mogul
Kent Swig has secured a minimum of USD 6 Billion in gold reserves to back
his new cryptocurrency, according to Bloomberg.

Gold Mountain Mining Corp. just announced breaking news, an updated National
Instrument 43-101 Mineral Resource Estimate following the conclusion of its
Phase1 drill program at the Elk Gold Project.  An updated technical report
will be filed on the Company's website and SEDAR within 45 calendar days of
this disclosure.

INVESTORS DIARY 2021

Company

Event

Venue

Date & Time

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
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opinions expressed and recommendations made are subject to change without
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