Bulls n Bears Daily Market Commentary : 04 April 2022

Mon Apr 4 15:53:42 CAT 2022

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Bulls n Bears Daily Market Commentary : 04 April 2022

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ZSE commentary

The ZSE shares closed today's session with marginal gains in a mixed trading
session. Activity levels were at 442 trades. Delta was the most active stock
at 42 trades followed by Econet and FCA at 25 and 24 trades respectively.
Investor sentiment was negative after the session yielded 17 risers against
18 decliners while eight (8) of the active stocks remained unchanged. Delta
anchored both volume and value aggregate trading 654,600 shares with a value
of ZW$157.30 million. The All-Share Index added 0.54% to close at 16,185.27
points. The Top 10 Index added 0.30%. The Top 15 Index added 0.47%. The
Medium Cap Index was up by 1.29% to 26,673.32 points whilst the Small Cap
Index added 0.89% to 403,032.67 points. Leading the risers pack of the day
was Rio Zimbabwe and CAFCA closed 20.00% and 16.28% higher respectively.
First Mutual Properties was up by 9.29%. 

Axia added 8.51% and First Capital Bank added 5.83%. Mitigating the gains
were losses in Medtech and Zimpapers and which shaded 16.19% and 11.70%
respectively. Nampak was down by 5.33%. Dairibord and Zimre Holdings shaded
3.97% and 2.28% respectively. The ETFs traded 300,276 units worth
ZW$1,055,550.40 in 128 trades. The Old Mutual Top 10 ETF shaded 1.16% to
close at 837.21c while the Morgan and Co Multi Sector ETF added 1.69% to
close at 1483.39c. The Datvest MCSI ETF shaded 0.52% to close at 189.81c. On
the VFEX, Bindura traded 256,093 shares to close at US$ 5.35 cents.

 <mailto:info at bulls.co.zw> 

Global Currencies & Equity Markets

South Africa

Nigeria

Nigeria's forex reserves drop as pressure on Naira persists

Nigeria's forex reserves closed the month of March at $39.5 billion compared
to $40.5 billion it opened the new year on January 4, 2021 due to incessant
withdrawal by the Central Bank of Nigeria to keep the Naira stable against
the Dollar and other international currencies.

This indicates a $971.3 million drop with the period under review.

For a long time, the CBN has been supplying dollars to help meet forex
demands and stabilise the currency market.

For context, the October 2021 economic data of CBN shows as much as $16.7
billion was pumped into the official forex market in the first 10 months of
2021.

The highest amount during this period was in June 2021 where CBN committed a
total of $2.24 billion to the Investors and exporters window to help meet
demands and help keep the Naira's Value.

Despite this huge commitment, there is still a huge gap between the forex
demanded and what is currently available in the market.

Some banks recently announced the reduction of the monthly spending limit to
$20 from $100, while some temporarily suspended the usage of the
naira-denominated debit cards for international transactions.

In April 2015, the spending limit on naira-denominated cards for
international transactions was $50,000 per person per annum or $4,166.7 per
month.

South Africa

South Africa's rand steadies against stronger dollar

(Reuters) - South Africa's rand steadied in early trade on Monday,
struggling for momentum as a stronger dollar overshadowed Moody's revision
of the country's outlook to "stable" from "negative".

At 0635 GMT, the rand traded at around 14.6500 against the dollar, largely
unchanged from Friday's close.

The dollar made a firm start to the week, as the monthly U.S. jobs report
indicated a strong labour market and is likely to keep the Federal Reserve
on track to maintain its hawkish policy stance.

Higher rates in developed markets tend to drain capital from higher-yielding
but riskier emerging markets such as South Africa.

Read more: Markets will be looking for clues from the Fed ahead, as
historically strong month gets underway

On Friday, ratings agency Moody's revised South Africa's outlook to
"stable", saying the country's improved fiscal outlook would help the
government stabilise its debt burden over the medium term.

Investor focus was also on talk of more sanctions against Russia over its
invasion of Ukraine.

"As we head into the new week, Russia is, yet again, in the headlines, as
bans on Russian gas imports to Europe come under discussion by European
leadership," said Bianca Botes, director at Citadel Global.

While Russia-Ukraine peace talks dragged on, reports of Russian atrocities
led Germany to say the West would agree to impose more sanctions in coming
days.

 <mailto:info at bulls.co.zw> 

Global Markets

Rupee trades in narrow range against US dollar in early session

The local unit, however, closed the 2021-22 fiscal with overall losses of
3.61 per cent or 264 paise against the American currency due to a stronger
dollar and surging crude oil prices.

Agencies

The forex market was closed on Friday for the annual account closing of
banks.

Mumbai: The rupee started the financial year 2022-23 on a muted note and
inched higher by 3 paise to 75.71 against the US dollar in early trade on
Monday amid a firm trend in the domestic equity market. At the interbank
foreign exchange, the rupee opened lower at 75.77 against the American
dollar, then touched an early high of 75.71, up 3 paise over its previous
close. The local unit also reached 75.79 in initial deals.

On Thursday, last trading session of FY22, the rupee advanced by 16 paise to
close at 75.74 against the US dollar.

The local unit, however, closed the 2021-22 fiscal with overall losses of
3.61 per cent or 264 paise against the American currency due to a stronger
dollar and surging crude oil prices.

The forex market was closed on Friday for the annual account closing of
banks.

Global oil benchmark Brent crude futures rose 0.13 per cent to USD 104.53
per barrel.

Meanwhile, the dollar index, which gauges the greenback's strength against a
basket of six currencies, fell 0.06 per cent to 98.57.

On the domestic equity market front, the 30-share Sensex was trading
1,462.66 points or 2.47 per cent higher at 60,739.35, while the broader NSE
Nifty inched higher by 393.75 points, or 2.23 per cent, to 18,064.20.

Foreign institutional investors remained net buyers in the capital market on
Friday as they purchased shares worth Rs 1,909.78 crore, according to stock
exchange data.

On the domestic macroeconomic front, India's current account deficit widened
to USD 23 billion or 2.7 per cent of the GDP in the December quarter,
according to the Reserve Bank of India.

The deficit was at USD 9.9 billion or 1.3 per cent of the GDP in the second
quarter of the fiscal while the same stood at USD 2.2 billion or 0.3 per
cent of the GDP in the year-ago period, the data on Balance of Payments
showed.

The Centre's fiscal deficit at the end of February stood at 82.7 per cent of
the full-year budget target, mainly on account of higher expenditure, as per
the government data released on Thursday.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Copper prices dip on firm dollar and China demand worries

London copper fell on Monday as the dollar strengthened and U.S. jobs data
raised expectations of aggressive increases to U.S. interest rates, with
sentiment also dented by lingering concerns over demand in top consumer
China.

Three-month copper on the London Metal Exchange (LME) was down 0.5% at
$10,305 a tonne at 0715 GMT.

Trading was sluggish, with Chinese financial markets were closed for a
public holiday, but traders kept a wary eye on the country's COVID-19
lockdowns and their impact on economic output and overall demand.

The lockdown in China "has already led to a slowdown in the domestic
movement of base metals, (and) as a result, production cuts at metal
fabricators have also been implemented," ANZ commodity strategists said in a
note.

Zinc and aluminum prices, however, were supported by fears of supply
shortages owing to the Russia-Ukraine conflict.

DOLLAR: The U.S. dollar made a firm start to the week as Treasury yields
rose with expectations of rapid U.S. rate hikes. A strong dollar makes
greenback-denominated metals more expensive to buyers using other
currencies.

MORE SANCTIONS: Ukrainian authorities were investigating possible war crimes
by Russia after finding hundreds of bodies strewn around towns near Kyiv.
Germany said the West would agree to impose more sanctions on Moscow in the
coming days.

PRICES: Aluminium rose 1% to $3,484 a tonne and zinc was up 0.8% at
$4,371.50 while nickel shed 0.8% to $32,950, lead dipped 0.4% to $2,439 and
tin slipped 0.6% to $44,500. 

Gold steady as stronger dollar, yields counter Ukraine woes

Gold prices were steady on Monday as the dollar and Treasury yields firmed
following a solid U.S.

payrolls report that raised expectations of aggressive rate hikes, while a
worsening Ukraine crisis supported safe-haven bids for bullion.

Spot gold was little changed at $1,925.97 per ounce. U.S. Gold futures was
up 0.3% to $1,929.70.

"While the conflict in Eastern Europe may be providing a modest tailwind to
gold prices on dips, it is very clear now that the main pricing inputs into
gold have swung to the impact of higher U.S. yields and a higher U.S.
dollar," said OANDA senior analyst Jeffrey Halley adding that Asia trade was
muted on account of a China holiday.

A stronger dollar makes gold less attractive for other currency holders,
while higher yields increase the opportunity cost of holding non-paying
bullion.

The dollar made a firm start to the week while Treasury yields were also
higher, as the monthly U.S. jobs report indicated a strong labor market and
is likely to keep the Federal Reserve on track to maintain its hawkish
policy stance.

U.S. job data showed the unemployment rate falling to a new two-year low of
3.6% and wages re-accelerating, positioning the Fed to raise interest rates
by a hefty 50 basis points in May.

Investors are looking forward to any discussion of a 50 basis point rate
hike when the Fed releases minutes from its March meeting on Wednesday.

Meanwhile, Germany's defence minister said on Sunday the European Union must
discuss banning imports of Russian gas, after Ukrainian and European
officials accused Russian forces of atrocities.

INVESTORS DIARY 2022

Company

Event

Venue

Date & Time

Counters trading under cautionary

ART

Seed co Int.

Starafrica

Medtech

Turnall

Seed co

Invest Wisely!

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