Bulls n Bears Daily Market Commentary : 02 June 2022

Thu Jun 2 20:53:50 CAT 2022

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Bulls n Bears Daily Market Commentary : 02 June 2022

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

ZSE commentary

Mid and small cap counters lead in gains.

The market upswing continued in the second trading session of the month, as
mid and small cap counters led the market gainers. The primary All Share
Index put on 1.53% to 23747.50pts while, the ZSE Top Ten Index extended
1.72% to 15842.11pts. The Mid Cap Index ticked up 1.55% to 38562.94pts
while, the ZSE Agriculture Index added 0.26% to end at 120.61pts. Property
concern FMP topped the gainers' list on a 14.92% jump to $7.4700, trailed by
Zimplow that garnered 14.88% to $22.0000. Dairibord advanced 14.00% to end
at $57.0000 on reports that the milk processor will invest in solar energy.
Hotelier RTG swelled 11.63% to $7.9032 as banking group NMB capped the top
five risers of the day on a 10.48% lift to $30.0892. TSL was the worst
performer of the day after shedding 3.45% to $82.0700.

Following was Proplastics that trimmed 2.94% to $66.0000 while, Tanganda let
go 1.80% to $245.4500. Retailer OKZIM slipped 0.92% to $42.0046 and Econet
completed the top five fallers' set on a 0.48% loss to $239.2509. Volume of
shares traded ballooned 104.62% to $6.91m as OKZIM and Mashonaland claimed
34.73% and 31.52% of the total volumes traded. Turnover eased 5.40% to
$699.54m with value leaders of the day : Innscor, Simbisa, Delta, OKZIM and
National Foods which contributing a combined 90.76% of the outturn. Nickel
miner Bindura grew 3.81% to settle at USD$0.0327 as 205,079 shares worth
USD$6,697.33 exchanged hands. The three ETFs closed pointing northwards with
the Datvest gaining 4.14% to $2.0762 and the Old Mutual improving 1.05% to
$10.7795 while, the Morgan and Co rose 0.17% to $23.9933. Elsewhere, Delta
released its FY22 results in which the beverages group recorded a 51.94%
increase in profit after tax to $16bn in inflation adjusted terms. EFE
Securities

 <mailto:info at bulls.co.zw> 

Global Currencies & Equity Markets

South African rand firm against dollar

South Africa's rand firmed in early trade on Thursday, even as the U.S.
dollar held its gains against major peers.

At 0630 GMT, the rand traded at 15.5700 against the dollar, 0.16% stronger
than its previous close.

The rand took its cue from global markets, after sky-high oil prices eased
on a report that Saudi Arabia was ready to pump more oil if Russian output
fell.

South Africa's government outlined new measures this week to ease pressure
on consumers to curb steeply rising domestic fuel prices.

The dollar index, which measures the greenback against a basket of six major
peers, was trading at 102.390.

The government's benchmark 2030 bond was weaker in early deals, with the
yield up 1 basis point to 9.88%. (Reporting by Bhargav Acharya in Bengaluru;
Editing by Edmund Blair)

Reuters

Zambian kwacha seen firming, Kenya and Uganda currencies weakening

Zambia's currency is expected to firm going into next week as Kenya and
Uganda's weaken. Tanzania's currency is likely to hold steady.

(Reuters) - Zambia's currency is expected to firm going into next week as
Kenya and Uganda's weaken. Tanzania's currency is likely to hold steady.

ZAMBIA

The kwacha ZMW= is likely hold firm against the dollar next week due to
increasing hard currency supply from corporates buying the local currency to
pay taxes.

On Thursday, the currency of Africa's second-largest copper producer was
trading at 17.1400 per dollar from 17.1700 at the close of business a week
ago, Refinitiv data showed.

"Improved hard currency inflows, especially from companies preparing for Pay
As You Earn tax due on Friday next week should help the kwacha," a
commercial bank trader said.

KENYA

Kenya's shilling KES= is expected to weaken due to increased demand for the
dollar from general merchant importers.

Commercial banks quoted the shilling at 116.65/85 per dollar, compared with
last Thursday's close of 116.60/80.

On Tuesday, the shilling touched a new all-time low of 116.80/117.00,
according to Refinitiv data.

"It (the shilling) will remain on the backfoot for now. From general
merchants, the demand (for the dollar) is still high," a trader at one
commercial bank said.

UGANDA

The Ugandan shilling UGX= is seen weakening, albeit at a slower pace, over
the next few days as a central bank policy move satisfies a recent surge in
appetite for hard currency.

At 1140 GMT, commercial banks quoted the shilling at 3,740/3,750, compared
to last Thursday's close of 3,690/3,700.

"I think the rate hike will only slow the (shilling) depreciation ... the
momentum will remain on the weakening side," said a trader at one commercial
bank, referring to the central bank rate decision.

On Thursday the central Bank of Uganda raised its benchmark rate by 100
basis points to 7.5%, aiming to counter a surge in inflationary pressures
and lend support to the local unit.

The shilling has weakened sharply in recent weeks, undercut by strong demand
for dollars from importers and portfolio investors.

TANZANIA

Tanzania's shilling TZS= is expected to hold steady next week due to strong
support of inflows from investors.

Commercial banks quoted the local unit at 2,324/2,334 against the dollar on
Thursday, compared to 2,322/2,332 at last Thursday's close.

"With the expectation of the inflation rate to remain stable, we believe the
shilling will remain around an average of 2,327 in the coming week," said
Kristine Van Helsdingen, a trader at AZA Finance.

 <mailto:info at bulls.co.zw> 

Global Markets

Dollar retreats as investors reach for riskier currencies

(Reuters) - The U.S. dollar eased across the board on Thursday, ceding some
of the ground gained in recent sessions as firmer risk sentiment prompted
investors to reach for higher-yielding currencies.

Stock markets around the world were largely stronger on Thursday after
recent weakness, as bets Saudi Arabia may boost crude production cooled oil
prices, helping balance concerns over surging inflation and monetary policy
tightening.

"There are a few factors working against the greenback today, but it's
mostly risk-on sentiment," said John Doyle, vice president of dealing and
trading at Monex USA.

News that Saudi Arabia may pump more oil and reports that China will ease
some COVID restrictions are helping bolster risk sentiment, to the
safe-haven dollar's disadvantage, Doyle said.

Oil prices were little changed, erasing losses made early on Thursday after
OPEC+ agreed to boost crude output to compensate for a drop in Russian
production.  

Shanghai sprung back to life on Wednesday after two months of bitter
isolation under a strict COVID-19 lockdown, with shops reopening and people
going back to offices, parks and markets.  

The U.S. dollar currency index , which tracks the greenback against six
major currencies, was 0.4% lower at 102.11, on pace to snap a two-day streak
of gains.

The dollar found little support from data showing U.S. private payrolls
increased far less than expected in May, which would suggest demand for
labor was starting to slow amid higher interest rates and tightening
financial conditions, though job openings remain extremely high.  

Riskier currencies, including the Australian and the New Zealand dollars ,
advanced against their U.S. counterpart, rising 0.74% and 0.66%,
respectively.

The Canadian dollar edged higher against the greenback, a day after the Bank
of Canada raised rates and opened the door to an even faster pace of
interest rate hikes.  

The Swiss franc was 0.2% higher against the dollar after Swiss prices
increased by the most in 14 years during May, with Switzerland becoming the
latest country to be hit by more expensive fuel and food costs plaguing
economies around the world.  

In cryptocurrencies, bitcoin was about flat a day after dropping 6%, as the
world's largest digital currency by market value continued to struggle to
overcome a bout of selling pressure that has engulfed it in recent weeks.

The Thomson Reuters Trust Principles.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold prices climb as U.S. dollar slides

Gold prices rose on Thursday buoyed by a pullback in the dollar while
investors also focused on the upcoming U.S. jobs report.

Spot gold rose 0.6% to $1,856.30 per ounce by 1216 GMT. U.S. gold futures
was also 0.6% higher at $1,858.70.

The dollar index was down 0.4% on the day, slipping off a one-week high
touched on Wednesday.

Despite real interest rates set to move up, gold is holding on, supported by
economic uncertainty triggered by war in Ukraine and monetary policy
tightening, said Kunal Shah, head of research at Nirmal Bang Commodities.
"The key point here is we have not seen such magnitude of monetary
tightening before."

Investors are now looking to more U.S. employment data due later Thursday
and to Friday's U.S. payroll numbers that could give more cues on the
Federal Reserve's rate hike trajectory.

"The U.S. labour market is very tight, serving as a key argument for Fed
rate hikes. "Robust data today could push rate hike expectations further up
and put pressure on the gold price again," Commerzbank analyst Carsten
Fritsch said in a note.

While the U.S. policymakers have signalled a 50 basis point interest rate
rise this month and next, the outlook beyond that is uncertain. The Fed
already walks a tight rope as it reins in historic inflation while not
causing a recession.

While bullion is considered a safe haven during times of political and
economic uncertainty, higher interest rates increase the opportunity cost of
holding gold, which bears no interest. Spot silver rose 1.5% to $22.13 per
ounce, platinum gained 1.5% to $1,011.72, and palladium was 1.3% higher at
$2,023.01. London markets are closed for Queen Elizabeth's Platinum Jubilee
bank holidays.

.

INVESTORS DIARY 2022

Company

Event

Venue

Date & Time

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
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