Bulls n Bears Daily Market Commentary : 28 September 2021

Tue Sep 28 16:07:11 CAT 2021

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Bulls n Bears Daily Market Commentary : 28 September 2021

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ZSE commentary

The ZSE stormed past yesterday’s peak to post a record close for the fifth consecutive session as over 55% of the stocks closed in the green. The market hit the ZW$1 trillion mark. There was improved activity levels and turnover value in today’s session. Activity levels climbed to 606 trades and market bias still firm in the positive as 27 stocks rose while 8 lagged and 5 of the active stocks remained unchanged. Medtech was the most active stock at 55 trades followed by OK Zimbabwe and Ariston at 49 and 34 trades respectively. Cassava anchored volume aggregate trading 1 360 100 shares and CBZ anchored value aggregate with a value of ZW$84.9 million. The benchmark All Share Index firmed past the 8 000 plateau to settle at 8 421.17 points, up 2.92%. The Top 10 Index added 3.54%. The Top 15 Index gained 3.20%. The Medium Cap Index traded higher to 19 808.00 points appreciating by 1.96% whilst the Small Cap Index also added 1.35% to close at 247 652.93 points.

Leading the risers pack of the day was Medtech Holdings which added 19.18%. Wildale added 19.01% to 400c. Cassava  added 13.18% and Mashonaland Holdings was up by 18.21%. Hippo added 12.88%. Bears for the day were First Mutual Holdings and First Mutual Properties which shaded 3.54% and 2.15%. Nampak lost 0.38% together with Zimre which shaded 0.31%. The Old Mutual Top Ten ETF closed at 317.92c up by 10.55% after trading 28 900 units with a value of ZW$91 880 in 26 trades closing with a YTD gain of 217.92%.wealthaccess

Global Currencies & Equity Markets

South Africa

Rand bleeds amid concerns that China woes will hit SA

The rand is taking a bigger hit than most of its emerging-market peers as an energy crisis and Chinese growth concerns batter the South African currency and worsen the country’s inflation outlook. 

The currency declined for a second day on Monday to its weakest level in more than a month as oil prices soared, while traders fretted over China’s growth hurdles and how that would affect prices of the raw materials that account for close to half of South Africa’s exports.

The weaker currency, along with crude-oil prices at the highest in more than two years, pushed breakeven rates, which reflect bond investors’ expectations of price rises, to levels last seen in June 2019. 

As an oil-importing nation, South Africa is sensitive to changes in the price of the fuel: gasoline accounts for almost 5% of the country’s inflation basket. A rise in oil prices would fuel price increases across the economy, complicating the central bank’s task as it tries to keep inflation in check without stifling a tentative recovery from the pandemic-induced contraction.

The fortunes of China, the biggest buyer of South African commodity exports, also have a bearing on the rand. High commodity prices have helped South Africa maintain a current-account surplus this year, supporting the rand.

That may change as a slowing Chinese economy reduces demand. Nickel and tin fell sharply in London on Monday as China’s power crisis spread from factories to residents, adding risks to supply chains, demand and the economic recovery.

The rand fell by more than 2%. On Monday afternoon, it was trading at R15.08 per dollar. Yields on benchmark 10-year securities rose a sixth day to 9.60%. That’s the highest since July 2020. They rise further as investors demand more compensation for the inflation risk.

The bonds have dropped 4.8% in dollar terms this month, making them one of the biggest losers among peers in Africa and the Middle East, according to a Bloomberg Emerging Market Local Currency Index. The declines are behind only Turkey and Chile in developing-nations.

Nigeria

Nigeria naira at record black market low despite successful Eurobond sale

(Reuters) - The Nigerian naira hit a record low of 573 against the dollar on the black market on Monday, shrugging off news of the country's Eurobond sale, meant to boost its currency reserves, traders said, weighed by a recent clampdown on retail forex operators.

The West African country sold $4 billion via Eurobonds last week after investors submitted bids of $12.2 billion. It is considering an additional issue.

But traders on the informal black market have shrugged off the news, citing the central bank's ban on dollar sales to exchange bureaus in an attempt to channel demand from the unofficial market, where the naira is trading at much lower levels.

Forizs added that pressure on the black market could abate if the central bank lifts currency restrictions on imports.

Nigeria has been battling dollar shortages brought on by low oil prices, which worsened with disruptions linked to COVID-19. The central bank has devalued the currency three times since March last year, but the naira has continued to weaken.

The currency has been hitting new lows on the black market since the central bank action. It has traded within a range on the official market, supported by the central bank.

Patience Oniha, head of the Debt Management Office, told Reuters that Nigeria's credit story coupled with strong engagement helped it sell the dollar-denominated bond and that it was considering more sales.

The Thomson Reuters Trust Principles.

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Global Markets

Sterling falls to 9-month low vs dollar as U.S. yields surge

(Reuters) - Sterling fell on Monday to nine-month lows against the resurgent dollar as a steep rise in U.S. Treasury bond yields overshadowed the Bank of England’s hawkish signals.

U.S. yields have surged since last week’s Federal Reserve meeting where it said it may start tapering stimulus as soon as November and flagged interest rate increases could follow sooner than expected.

Tuesday’s remarks from Fed Chair Jerome Powell signalled nervousness about inflation, and pushed U.S. 10-year yields above 1.54% to the highest since mid June and also led markets to price higher future inflation.

British 10-year gilt yields also rose to the highest since the pandemic started above 1%. But concerns have also grown about how gas and petrol shortages could impact the British economy.

By 1255 GMT the risk-sensitive pound fell 1.2% and traded as low as $1.3538, after touching its lowest since mid January. Versus the euro, it slid 1% to its lowest since July, at 86.23 pence.

Sterling had jumped last week following the Bank of England’s hawkish tone on interest rates and its pandemic-era government bond-buying scheme. Governor Andrew Bailey reiterated on Monday that he and other members of the Monetary Policy Committee saw a growing case to raise interest rates.

But analysts said those gains may have been overdone given the other challenges facing the British economy.

Some petrol station pumps ran dry in British cities and vendors rationed sales as a post-Brexit shortage of truckers triggered panic buying and raised fears that hospitals would be left without doctors and nurses.

Standard Chartered senior economist Sarah Hewin said there were headwinds to the economy from the supply bottlenecks.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Copper ticks lower on firm dollar, China worries

(Reuters) - Copper prices slipped on Tuesday on a stronger dollar and concern about the impact of power cuts in top metals consumer China, where the economy has already been weakening.

Three-month copper on the London Metal Exchange fell 1.1% to $9,258 in official trading after rising by 0.3% on Monday.

Copper has eased from a record peak of $10,747.50 touched in May, but it is still up 20% so far this year.

In China, a shortage of coal supplies, toughening emissions standards and strong demand from manufacturers and industry have pushed coal prices to record highs and triggered widespread curbs on usage.

The U.S. dollar rose to its highest in more than five weeks due to rising bond yields, making metals priced in dollars more expensive for buyers using other currencies.

* Profit growth at China’s industrial firms slowed for a sixth month as plants fought off high commodity prices, COVID-19 outbreaks and part shortages.

* LME nickel was the biggest loser, sliding 1.9% in official activity to $18,585 a tonne after shedding more than 2% on Monday. “The power curtailment policy affects part of the downstream consumption of nickel,” brokerage Huatai Futures said in a note.

* LME tin bounced by 1% to $35,450 a tonne, having tumbled more than 4% on Monday after power usage curbs in China also cut demand for refined tin.

* LME aluminium gained 1.1% to $2,915, zinc added 0.4% to $3,079 and lead climbed 1% to $2,183.

* For the top stories in metals and other news, click or (Additional reporting by Mai Nguyen in Hanoi and Tom Daly; editing by David Evans and Louise Heavens)

Indian spot gold rate and silver price on Tuesday, Sep 28, 2021

Today Gold Rate ( ₹ 46290) is higher than this week's average of ₹46278.6 by 0.02%. The Gold Price was higher than yesterday's value of ₹46280.

Although the Gold Price Today in both global ($1816.7) as well as Indian market ( ₹46290) experienced a growth, the Gold Price in Indian market grew by a lesser rate of 0.02% as compared to the growth Global gold price of 0.18%.

Gold and other precious metals on Tuesday, Sep 28, 2021

The Gold Price Today continued its uptrend as compared to yesterday in the global market. The Gold Price rose by 0.18% to $1816.7 per Troy ounce. This price level is 4.24% higher than average Gold Price observed in the past 30 days ($1739.7). Among the other precious metals, Silver Price Today saw a fall. The Silver Price plunged 0.06% to $25.2 per Troy ounce.

Further, platinum price has shown an uptick. The precious metal platinum rose 0.05% to $1078.0 per Troy ounce. Meanwhile in India, gold was priced at ₹45985 per 10 gram on MCX, with a change of ₹110.4. Also, the price of 24k gold in the Indian spot market was quoted at ₹46290 . 

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 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.

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