Bulls n Bears Daily Market Commentary : 11 March 2022

Fri Mar 11 15:10:16 CAT 2022

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Bulls n Bears Daily Market Commentary : 11 March 2022

ZSE commentary

The ZSE shares closed in the negative albeit marginally as the bourse is lacking momentum for a positive move. Activity levels were at 463 trades. Delta was the most active stock at 79 trades followed by Star Africa and Axia at 32 and 26 trades respectively. Investor sentiment was negative after the session yielded 21 decliners against 10 risers while nine (9) of the active stocks remained unchanged. First Capital Bank anchored volume aggregate trading 3,353,300 shares and Delta anchored value aggregate with a value of ZW$217.72 million.

The All-Share Index shaded 0.50% to close at 14,655.18 points. The Top 10 Index shaded 0.56%. The Top 15 Index shaded 0.53%. The Medium Cap Index was down by 0.28% to 24,472.02 points whilst the Small Cap Index shaded 1.11% to 398,104.07 points. Leading the risers pack of the day was Proplastics closed at 3,000c and Zimre Holdings was up by 7.06%. AfDis added 6.67% and Wildale added 3.98% to 296.33c. First Mutual Holdings was up by 3.17%. Mitigating the gains were losses in African Sun  and NMB Holdings which shaded 12.62% and 10.72% respectively. First Mutual Properties was down by 6.73%. Mashonaland Holdings and Turnall shaded 6.32% and 4.00% respectively. The ETFs traded 882,807units worth ZW$2,663,737.45 in 261 trades. The Old Mutual Top 10 ETF shaded 14.93% to close at 804.90c while the Morgan and Co Multi Sector ETF shaded 0.19% to close at 1466.46c. The Datvest MCSI ETF shaded 7.51% to close at 175.53c. On the VFEX, Bindura traded 341,100 shares to close up 20.00% at US 5.40 cents. wealthaccesssecurities

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Global Currencies & Equity Markets

South Africa

South Africa's rand weakens on surging inflation, Ukraine risks

(Reuters) - South Africa's rand weakened on Friday after a strong U.S. inflation report raised the prospect of more aggressive interest rate hikes globally, while talks between Russia and Ukraine brought little respite in the conflict between the two countries.

At 0650 GMT, the rand ZAR=D3 traded at 15.0725 against the dollar, 0.18% weaker than its previous close.

Investors braced for quicker tightening of monetary conditions after data on Thursday showed a 7.9% annualised jump in U.S. consumer inflation in February, the largest increase in 40 years.

Sentiment also suffered as Russia's war against Ukraine dragged on, after talks between their foreign ministers on Thursday yielded no signs that their conflict will de-escalate.

"With the lack of progress and the continued assault on Ukraine and its people, the sanctions from the West will keep coming which should ensure uncertainty remains high in the markets and any rallies vulnerable," Craig Erlam, Senior Market Analyst at OANDA said.

The yield on the benchmark 2030 government bond ZAR2030= was down 3 basis points to 9.870%.

Nigeria

Naira Fall to N576/$1 at P2P, N416.67/$1 at Spot Market

It was a weaker outcome for the Naira against the United States Dollar as it depreciated at the Peer-2-Peer (P2P) window of the foreign exchange market on Thursday, March 10.

The local currency wrapped the session at N576/$1 after N1 or 0.17 per cent versus N575/$1 it was quoted at the preceding session.

Equally, at the Investors and Exporters (I&E) window, the Naira depreciated against the US Dollar by 0.04 per cent or 17 kobo to sell at N416.67/$1 in contrast to the previous day’s exchange rate of N416.50/$1, according to data obtained from FMDQ Securities Exchange.

At the official exchange rate window, the local currency remained flat against the British Pound Sterling and the Euro on Thursday as the value of the Naira closed at N558.23/£1 against the Pounds and against the Euro, it closed at N466.37/€1.

Meanwhile, at the cryptocurrency market, it was bearish as eight of the 10 digital assets monitored by Business Post were in the red, with Binance Coin (BNB) retreating by 1.8 per cent to N153,270.87.

Bitcoin (BTC) recorded a 1.7 per cent loss as it traded at N24,622,449.00, Solana (SOL) also saw a 1.7 per cent depreciation to sell at N56,129.28, Ethereum (ETH) saw a 1.6 per cent depreciation to trade at N1,660,259.00, Dash (DASH) depreciated by 1.2 per cent to trade at N59,108.270, Cardano (ADA) went down by 0.7 per cent to trade at N464.90, Litecoin (LTC) saw its value drop 0.4 per cent to sell at N66,330.00, while Dogecoin (DOGE) made a 0.3 per cent loss to close at N67.55.

The two gainers were led by Ripple (XRP) with a growth of 1.5 per cent to exchange at N589, while the US Dollar Tether (USDT) appreciated by 0.2 per cent to sell for N592.95.

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Global Markets

Euro rises as Putin sees "certain positive shifts" in talks with Ukraine

(Reuters) - The euro rose on Friday after Russian President Vladimir Putin said there had been some progress in Moscow's talks with Ukraine.

Even if Putin provided no details, the euro rose 0.4% to $1.1043 minutes after Putin said in a meeting with his Belarusian counterpart Alexander Lukashenko that talks continued practically on daily basis.

"There are certain positive shifts, negotiators on our side tell me," Putin said, without elaborating. 

The euro was 0.25% higher at $1.1023 as of 1225 GMT, after rising as high as $1.11215 on Thursday in a choppy day.

The euro has fallen almost 2% against the U.S. dollar in March after Russia started a military operation in Ukraine last month. But it was heading on Friday to its first weekly gains in five weeks.

"Although both parties are still quite some distance apart from compiling and signing a formal peace treaty, headlines suggest that ground is being made in trying to bring about a more peaceful resolution," Simon Harvey, head of FX Analysis at Monex Europe.

This is the reason why euro saw some modest gains after Putin's statement, he added.

After falling to its lowest level in almost two years on Monday amid rising stagflation worries arising from the Ukraine war, the euro also found some support on the European Central Bank's announcement that it will phase out its stimulus, opening the door to an interest rate hike before the end of 2022. 

The dollar rose 0.06% against a basket of peers to 98.418. It was still near a five-year high on the Japanese yen, up 0.7% to 116.88 yen as markets prepare for the Federal Reserve tightening after the release of strong U.S. inflation data. 

Both the Fed and the Bank of Japan have policy meetings next week, but while the Fed is all but certain to hike rates from their pandemic low, the BOJ is set to remain an outlier. 

Amid rising energy prices, commodity-linked Norwegian crown rose 0.7% versus the dollar to 8.8910 crowns.

The Ukraine war has also weighed on sterling , which has fallen 2.3% this month versus the dollar and hit a 16-month low on Friday, before rising 0.3% to $1.3117 after Putin's statement.

Bitcoin rose 1.8% to $40,000. It had surged this week after U.S. President Joe Biden signed an executive order on Wednesday requiring the government to assess the risks and benefits of creating a central bank digital dollar. 

The Thomson Reuters Trust Principles.

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Commodities Markets

Gold steadies near $2,000/oz as Ukraine worries lend support

(Reuters) - Gold steadied near the $2,000 an ounce level on Thursday, after big gyrations over the past couple of sessions, as its safe-haven appeal was supported by a lack of progress in talks between Russia and Ukraine.

Spot gold rose 0.2% to $1,996.30 per ounce by 13:53 ET (1853 GMT), after tumbling as much as 3% on Wednesday. U.S. gold futures settled up 0.6% at $2,000.40.

A rush to safe-haven assets earlier this week had pushed gold near the record levels hit in August 2020.

Investors also took stock of February inflation data from the United States, which was in line with expectations but also showed the biggest year-on-year increase since January 1982. 

"The inflation numbers are certainly an underlying bullish element for gold. However, geopolitics is trumping economic data right now," said Jim Wycoff, senior analyst at Kitco Metals.

"(Gold) bulls spent a lot of energy pushing prices to a record high earlier this week. Now, even bullish inflation data isn't given much benefit because (prices) are just exhausted."

Against the backdrop of surging oil and commodity prices, investors now await the Federal Reserve's next policy statement on March 16.

Hurting appetite for riskier assets, talks between Russia and Ukraine's foreign ministers made no apparent progress towards a ceasefire. 

Palladium , used by automakers in catalytic converters to curb emissions, rose 0.4% to $2,948.73 per ounce. The metal hit a record high of $3,440.76 on Monday on fears of supply disruptions from top producer Russia. 

Overall, gold and palladium are still "relatively strong", with technicals pointed to the upside, said Eli Tesfaye, senior market strategist at RJO Futures, adding that Thursday's price action is likely to set the tone going forward.

Spot silver rose 0.7% to $25.90 per ounce, while platinum gained 0.1% at $1,077.37.

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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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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