Bulls n Bears Daily Market Commentary : 17 November 2021

Wed Nov 17 14:43:45 CAT 2021

 <http://www.bullszimbabwe.com> Bullszimbabwe.com         <mailto:bulls at bulls.co.zw> Views & Comments        <http://www.bullszimbabwe.com> Bullish Thoughts        <http://www.twitter.com/BullsBears2010> Twitter         <https://www.facebook.com/BullsBearsZimbabwe> Facebook           <http://www.linkedin.com/pub/bulls-n-bears-zimbabwe/57/577/72> LinkedIn          <mailto:info at bulls.co.zw?subject=Unsubscribe> Unsubscribe

Bulls n Bears Daily Market Commentary : 17 November 2021

 <mailto:info at bulls.co.zw> 

ZSE commentary

The ZSE continues to slid in the negative for the third consecutive day with major losses in heavyweight counters. Activity levels were at 398 trades. Delta was the most active stock at 54 trades followed by OK Zimbabwe and Star Africa at 33 and 20 trades respectively. Investor sentiment was strongly negative after the session yielded 26 decliners against only 5 risers while six of the active stocks remained unchanged. Truworths anchored volume aggregate trading 1 228 800 shares and Delta anchored value aggregate with a value of ZW$161.78 million.

The All-Share Index shaded 2.95% to close at 11 966.52 points. The Top 10 Index lost 3.56%. The Top 15 Index also shaded 3.50%. The Medium Cap Index was down by 1.48% to 21 461.10 points whilst the Small Cap Index added a marginal 0.46% to 399 218.53 points. Leading the shakers pack of the day was CBZ Holdings shading 14.05% and National Foods down by 8.43%. Econet pared 6.14% and OK Zimbabwe lost 5.91% to 2 759.10c. Wildale was down by 5.45%. Mitigating the losses were gains in Zimplow  and NMB Holdings  which added 1.99% and 0.93% respectively. General Beltings was up by 0.62% to 201.24c. Star Africa and Bindura added 0.28% and 0.26% respectively. The Old Mutual Top Ten ETF closed at 535.23c up by 7.05% after 6 715 units were traded worth ZW$35 941 in 23 trades.wealthaccess

Global Currencies & Equity Markets

South Africa

Rand holds on to gains after October inflation print, as focus shifts to SARB

The rand was marginally firmer on Wednesday morning, but earlier hit a 10-month low to the dollar, with the local currency showing little reaction to October's consumer inflation print, which met economists’ expectations.

At 10.25am the rand was 0.19% firmer at R15.463/$ and 0.22% stronger at R17.5011/€, while it was flat at R20.7987/£.

This is in line with where it was trading just before 10am, when data showed consumer inflation, as measured by the annual change in the consumer price index, was unchanged at 5% in October.

The local currency had slipped 1.88% against the dollar on Tuesday, with sentiment towards emerging-market currencies cloudy as investors considered whether Turkey’s central bank’s decision to look past surging inflation and cut rates reflected a loss of independence of policymakers. 

The Turkish lira fell almost 4% on Wednesday as the market mulled the prospect of yet another rate cut in that country this week, and the central bank has cut its key rate by 300 basis points since September. Meanwhile, inflation has risen to almost 20%, four times the official target.

As a fellow emerging-market currency, the rand often moves in sympathy with its peers, but better-than-expected US consumer retail sales numbers had also provided a boost to the dollar.

Rising inflation, which touched a more than three-decade high in the US in October, has become a major theme on the markets, as consumers and business battle surging energy costs and supply-chain disruptions. Policymakers have stressed that inflationary pressures are likely to subside as the world returns to normality as Covid-19 abates, while there is also a need to support the economic recovery.

A weaker rand fuels local inflation as it raises the cost of imports, notably oil, with SA motorists already paying record prices at the pump.

Economists are split on what the Bank will do, with 10 of 20 economists polled by Bloomberg expecting rates to remain unchanged, while 10 expect a 25 basis point hike.

Domestic political wrangling is also generating uncertainty, as parties battle to form coalitions to rule major metros, notably in SA’s economic hub of Gauteng. The rand has found some support recently, after the ANC indicated it is not looking to accept the radical left-wing terms of the EFF, with the municipal elections showing less appetite for radicalism, Investec chief economist Annabel Bishop said in a note earlier this week.

Nigeria

Naira extends stability at official market

Naira maintained stability against the U.S. dollar at the official market on Tuesday, extending the currency’s stable run to three days on a stretch at the spot market.

FMDQ securities exchange windows where forex is officially traded showed that the local unit closed at N415.10 to a dollar again at the close of business Tuesday, the same rate the currency had traded in the past three sessions simultaneously.

Naira reached an intraday high of N404.00 and a low of N444.00 before closing at N415.10 to a dollar again on Tuesday.

Foreign exchange turnover depreciated by 54.81 per cent with $62.53 million recorded at the spot market segment against the $138.37 million posted at the close of business on Monday.

At the black market in Uyo, dealers said they exchanged the currency at N539.00 to a dollar in the morning, but later crashed to N530.00 per $1 at the close of business Tuesday.

In Abuja, dealers said they exchanged the domestic unit again at N540.00 to a dollar, and sold at N545.00.The same rate it traded in the previous session on Monday.

 <mailto:info at bulls.co.zw> 

Global Markets

Dollar gets fresh legs from U.S. data, hawkish talk

(Reuters) - The U.S. dollar held above 4-1/2 year highs versus the yen and was set to make fresh gains towards the $1.12 levels against the euro on Wednesday after robust U.S. data and hawkish comments from Fed policymakers boosted expectations of a rate hike as early as mid-2022.

U.S. retail sales rose more than expected in October, a report showed Tuesday, building on momentum from last week when data showed consumer prices rising at the highest rate since 1990. read more

Money markets are pricing in a high probability of a Fed rate increase in June, followed by another in November. CME data suggest a 50% probability of a 25 bps rate hike by July 2022.

The dollar index - which measures the currency against six rivals - rose 0.1% to 96.053 after earlier touching 96.266 for the first time since July last year.

The greenback rose to as high as 114.975 yen , its highest since March 2017 before retreating to trade at 114.88 yen.

The euro dipped abruptly to $1.1263 for the first time since July 2020 before trading 0.2% lower at $1.1308.

St. Louis Fed president James Bullard said on Tuesday the central bank should "tack in a more hawkish direction" over its next couple of meetings to prepare in case inflation does not begin to ease. read more

Elsewhere, the pound climbed to a one-week high versus the U.S. dollar and a 21-month high against the euro after data showed British inflation reached a 10-year high in October, boosting expectations of a rate hike as early as next month.

In cryptocurrencies, bitcoin traded just south of $60,000, after dipping below that level on Tuesday for the first time this month. It reached a record $69,000 last Wednesday.

The Thomson Reuters Trust Principles.    

 <mailto:info at bulls.co.zw> 

Commodities Markets

Copper settles down at last, a month after big squeeze

Amonth after an unprecedented squeeze roiled the copper market, a short-term spread is back to normal levels as rising exchange inventories relieve the pressure on buyers.

The spread between spot and three-month contracts on the London Metal Exchange eased to a $32.50-a-ton premium by Monday’s close. While the premium signals that near-term supply is still tight, it’s back in line with levels seen prior to the October squeeze, when the spread surged above $1 100 as buyers were caught off guard by a sudden slump in stockpiles.

Spot contracts often trade at premiums when supply is scarce, in a condition known as backwardation. Rising premiums can spark major losses for industrial hedgers who need to buy back short positions as they approach expiry, as well as bearish investors who need to roll positions forward. The wild moves last month prompted the LME to take emergency measures to restore order.

While some analysts still say there’s a risk of further tightness while global inventories remain low, fears over another imminent squeeze have faded as available LME stockpiles climb from multidecade lows. On-warrant copper inventories rose to 53 175 t on Tuesday, continuing a steady increase from the low set in mid-October.

Major Chinese smelters have pledged to boost stockpiles further by shipping additional copper out to LME warehouses in Asia. In a sign that deliveries may be imminent, LME warehousing company Henry Bath Singapore, owned by major Chinese logistics firm CMST Zhongchu, on Monday listed an additional storage depot in Busan. South Korea and Taiwan are the closest delivery destinations for exporters shipping copper out of Shanghai.

Copper prices have also softened over the past month, as concerns also mounted that a slowdown in key industrial economies will hurt demand. The metal was down 0.4% at $9.634 a ton by 11:24 a.m. on the LME. Other metals were little changed or lower, with aluminum falling 1.3%. 

Gold prices muted as dollar strength weighs

Gold prices inched higher on Wednesday but hovered around a recent low, after a jump in U.S. retail sales kept the dollar close to a 16-month high.

Spot gold rose 0.2% to $1,854.39 per ounce by 0207 GMT, but the metal was still only about $6 shy off its lowest level since last Friday hit in the previous session. U.S. gold futures gained 0.2% to $1,857.10.

U.S. retail sales jumped in October, topping expectations, in an indication that high inflation was not yet dampening spending, even as worries about the rising cost of living sent consumer sentiment tumbling to a 10-year low in early November.

The report drove the dollar to a fresh 16-month peak, pressuring bullion by raising its cost to buyers holding other currencies.

Federal Reserve officials said on Tuesday they are vigilant of the ways that higher inflation can affect U.S. households and dampen consumer sentiment and want to get it under control.

Gold, often viewed as an inflation-hedge, has benefited from easy monetary policy during the pandemic, but any hike in rates should reduce bullion’s appeal as higher interest rates raises the non-interest bearing metal’s opportunity cost.

Britain’s job market withstood the end of the government’s furlough scheme last month, according to data which could ease lingering concerns at the Bank of England about the risks of raising interest rates from their pandemic low.

U.S. President Joe Biden pressed his Chinese counterpart on human rights in a video call lasting more than three hours, while Xi Jinping warned that China would respond to provocations on Taiwan, according to official accounts of the exchange.

Spot silver rose 0.6% to $24.95 per ounce. Platinum rose 0.3% to $1,064.73 and palladium gained 0.3% to $2,165.98.

INVESTORS DIARY 2021

Company

Event

Venue

Date & Time

National Unity Day

December 22

Christmas Day

December 25

Boxing Day

December 26

Public Holiday in lieu of Boxing Day falling on a Sunday

December 27

Counters trading under cautionary

ART

Seed co Int.

Starafrica

Medtech

Turnall

Seed co

Invest Wisely!

Bulls n Bears 

Cellphone:      <tel:%2B263%2077%20344%201674> +263 77 344 1674

Alt. Email:       <mailto:info at bulls.co.zw> info at bulls.co.zw  

Website:         <http://www.bullszimbabwe.com> www.bullszimbabwe.com 

Twitter:         @bullsbears2010

LinkedIn:       Bulls n Bears Zimbabwe

Facebook:      <http://www.google.com/url?q=http%3A%2F%2Fwww.facebook.com%2FBullsBearsZimbabwe&sa=D&sntz=1&usg=AFQjCNGhb_A5rp4biV1dGHbgiAhUxQqBXA> www.facebook.com/BullsBearsZimbabwe

Skype:         Bulls.Bears 

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 companies typically involve a higher degree of risk and more volatility than the securities of more established companies. Neither Faith Capital nor any other member of Bulls ‘n Bears nor any other person, accepts any liability whatsoever for any loss howsoever arising from any use of this report or its contents or otherwise arising in connection therewith. Recipients of this report shall be solely responsible for making their own independent investigation into the business, financial condition and future prospects of any companies referred to in this report. Other  Indices quoted herein are for guideline purposes only and sourced from third parties.

(c) 2021 Web: <http://www.bullszimbabwe.com>  www.bullszimbabwe.com Email:  <mailto:info at bulls.co.zw> info at bulls.co.zw Tel: +263 4 2927658 Cell: +263 77 344 1674

-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://listmail.bulls.co.zw/pipermail/bulls/attachments/20211117/99b37ea7/attachment-0001.html>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: image001.png
Type: image/png
Size: 34378 bytes
Desc: not available
URL: <http://listmail.bulls.co.zw/pipermail/bulls/attachments/20211117/99b37ea7/attachment-0002.png>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: image002.jpg
Type: image/jpeg
Size: 22328 bytes
Desc: not available
URL: <http://listmail.bulls.co.zw/pipermail/bulls/attachments/20211117/99b37ea7/attachment-0003.jpg>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: image003.jpg
Type: image/jpeg
Size: 107064 bytes
Desc: not available
URL: <http://listmail.bulls.co.zw/pipermail/bulls/attachments/20211117/99b37ea7/attachment-0004.jpg>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: image004.jpg
Type: image/jpeg
Size: 37760 bytes
Desc: not available
URL: <http://listmail.bulls.co.zw/pipermail/bulls/attachments/20211117/99b37ea7/attachment-0005.jpg>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: image005.png
Type: image/png
Size: 9458 bytes
Desc: not available
URL: <http://listmail.bulls.co.zw/pipermail/bulls/attachments/20211117/99b37ea7/attachment-0003.png>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: oledata.mso
Type: application/octet-stream
Size: 65552 bytes
Desc: not available
URL: <http://listmail.bulls.co.zw/pipermail/bulls/attachments/20211117/99b37ea7/attachment-0001.obj>