Bulls n Bears Daily Market Commentary : 23 November 2021

Tue Nov 23 16:43:48 CAT 2021

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Bulls n Bears Daily Market Commentary : 23 November 2021

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ZSE commentary

The ZSE closed in the negative with heavy losses being headlined by
heavyweight counters. Activity levels were at 458 trades. Delta was the most
active stock at 39 trades followed by Econet and Innscor 38 and 32 trades
respectively. Investor sentiment was negative after the session yielded 25
decliners against 8 risers while three of the active stocks remained
unchanged. RTG anchored both volume and value aggregate trading 608 087 320
shares which represents 24.37% if its issued shares with a value of ZW$3.442
billion which is 83.5% of total turnover.

The benchmark All-Share Index shaded 3.22% to close at 11 146.97 points. The
Top 10 Index lost 3.68%. The Top 15 Index also shaded 3.63%. The Medium Cap
Index was down by 2.40% to 21 089.48 points whilst the Small Cap Index pared
1.15% to 388 659.47 points. Leading the shakers pack of the day was African
Sun shading 16.40% and Unifreight down by 11.76%. Econet pared 10.32% and OK
Zimbabwe lost 9.45% to 2611.15c. Bindura was down by 7.88%. Mitigating the
losses were gains in Medtech Holdings  which recently undergo a share
consolidation adding 6129.95% to 3539.86c. Nampak was up by 9.54% to 1100c.
NMB Holdings and RTG added 4.45% and 2.76% respectively. The Old Mutual Top
Ten ETF closed at 528.88c down by 0.74% after 25 147 units were traded worth
ZW$132 996.75 in 25 trades.- wealthaccess

Global Currencies & Equity Markets

South Africa

Rand hits weakest level in 2021 as international factors bite

The South African rand hit its weakest point in 12 months on Tuesday (23
November) on the back of a stronger dollar and an expected hike in US
interest rates.

At 08h20, the rand traded at R15.88/dollar, 0.19% weaker than its previous
close and trading at its weakest since November 2020, Reuters reported.

The dollar jumped on bets for quicker interest rate increases after US
President Joe Biden backed Federal Reserve chair Jerome Powell for a second
term. Biden chose Powell over the other leading candidate Lael Brainard,
whom markets consider being the more dovish of the two, though Brainard will
be Fed vice-chair.

The move reinforced market expectations of US rate rises next year when the
central bank finishes tapering its emergency bond-buying programme.

Higher rates in developed countries often drain capital away from
higher-yielding but riskier emerging markets such as South Africa, weighing
on their currencies.

Riskier assets have also been shaken up over recent sessions amid surging
Covid-19 cases in Europe and renewed curbs, dousing investor hopes of a
quicker recovery in consumption and growth worldwide.

In a research note on Monday (23 November), Investec chief economist Annabel
Bishop said that the rand remains weaker as global factors continue to
provide a drag on emerging market assets.

At 09h15 on Tuesday (23 November), the rand was trading at the following
levels again the major currencies:

Dollar/Rand: R15.84 (-0.18%)

Pound/Rand: R21.20 (-0.25%)

Euro/Rand: R17.80 (-0.15%)

Nigeria

Nigeria Signals Preference for Weaker Naira Exchange Rate

Nigeria is selling dollars at less than the official rate, signaling that it
would prefer a weaker currency. 

 <mailto:info at bulls.co.zw> 

Global Markets

Dollar steadies near 16-month high; New Zealand dollar weakens

(Reuters) - The dollar index held near 16-month highs on Tuesday after
Federal Reserve Chair Jerome Powell was picked for a second term,
reinforcing market expectations that U.S. interest rates will rise in 2022.

Currency markets have been mostly driven in recent months by market
perceptions of the different paces at which global central banks reduce
pandemic-era stimulus and raise rates.

Sammani said the dollar strength was also due to rising front-end U.S.
yields, which was likely caused by commentary from Federal Reserve
policymakers. They include Atlanta Federal Reserve President Raphael Bostic,
who said on Monday that speeding up the tapering of asset purchases could
give the Fed more room for rate hikes in 2022.

Commerzbank's head of FX and commodity research, Ulrich Leuchtmann, said
that the decision to retain Powell was beneficial for the dollar because it
showed President Joe Biden respecting the Federal Reserve's independence
from government. 

At 1135 GMT on Tuesday, the dollar index was at 96.489, little changed on
the day and slightly below the 16-month high of 96.603 it reached during
Asian trading hours .

Versus Japan's yen, the dollar rose to its highest in four and a half years,
as investors expected U.S. interest rates to diverge from those in Japan.

The Japanese currency is sensitive to moves in U.S. Treasury notes, and
two-year U.S. Treasury yields rose 8.5 basis points on Monday to their
highest since early March 2020.

The dollar-yen move had eased by 1135 GMT, with the pair flat at 114.865,
compared to the peak of 115.160 reached earlier in the session .

The euro was up 0.1% against the dollar at $1.12455, recovering slightly
after hitting a 16-month low versus the dollar.

Better than expected euro zone PMI data helped push the euro slightly higher
on the day.  

However, the euro has lost 2.7% so far this month, hurt by a combination of
the European Central Bank's dovish monetary policy stance and, more
recently, a resurgence of COVID-19 cases in Europe.

The World Health Organization warned earlier this month that current
transmission rates in 53 European countries are of "grave concern" and
Germany's health minister has called for further restrictions on public
spaces.  

The Australian dollar was down 0.1% at $0.7218 while the New Zealand dollar
was down 0.5% at $0.6923.

The Reserve Bank of New Zealand (RBNZ) is expected to deliver a 25 basis
point rate hike on Wednesday, but speculation is rife that the central bank
could even go for a 50 basis point increase to counter rising inflationary
pressures. read more

The New Zealand dollar was falling versus the U.S. dollar because investors
expect short-dated U.S. yields to rise more than short-dated New Zealand
yields.

In cryptocurrencies, bitcoin was trading at around $56,300. Earlier this
month it had hit a new all-time high of $69,000 .

The Thomson Reuters Trust Principles.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold breaks below $1,800 as dollar, yields firm on rate hike bets

(Reuters) - Gold prices fell below the key $1,800 level on Tuesday, as the
dollar and bond yields firmed with expectations that U.S. interest rates
will rise next year, shored up by the renomination of Federal Reserve
Chairman Jerome Powell.

Spot gold fell 0.5% to $1,795.97 per ounce by 1248 GMT, after hitting its
lowest since Nov. 5 at $1,792.00.

U.S. gold futures dropped 0.6% to $1,796.30.

The dollar index hit a fresh 16-month peak and U.S. Treasury yields firmed
after Powell was nominated for a second term, adding to confidence that the
U.S. central bank will lift interest rates in 2022. read more

Investors are betting that newly renominated Fed Chairman Jerome Powell will
need to step up the pace at which the central bank is normalizing monetary
policy to better grapple with surging consumer prices.

While gold is considered a hedge against inflation and other uncertainties,
a likely hike in rates would increase the opportunity cost of holding
non-yielding bullion.

But it's "too early to write off gold", said Ross Norman, an independent
analyst.

Elsewhere, spot silver fell 1.6% to $23.79 per ounce, platinum dropped 1.6%
to $994.99, and palladium shed 0.7% to $1,941.07.

The Thomson Reuters Trust Principles.

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 

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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
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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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