Bulls n Bears Daily Market Commentary : 23 November 2022

Thu Nov 24 06:56:41 CAT 2022

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Bulls n Bears Daily Market Commentary : 23 November 2022

 <mailto:info at bulls.co.zw> 

ZSE commentary

ZSE overturn losses in mid-week session.

The market recorded modest gains in the mid-week session as selected heavies
bolstered the ZSE. The primary All-share Index rose 2.75% to 14099.90pts
while, the Blue-Chip Index edged up 3.51% to 8083.30pts. The Agriculture
Index ticked up 0.04% to 73.26pts as the Mid-Cap Index jumped 21.53% to
39925.09pts. Leading the gainers of the day was Mash Holdings that advanced
14.70% to close the day pegged at a vwap of $10.3233. Trailing was fast
foods group Simbisa that surged 11.72% to $234.9769. Clothing retailer
Truworths garnered 11.31% to $2.4489 while, Beverages giant Delta, added
6.55% to $214.4777. Bankers NMB capped the winner's' list on a 4.09% uplift
to close the day at $25.0018.

while led the laggards of the day on a 5.56% drop to $9.0000 while, spirits
and wines manufacturer AFDIS lost 5.45% to settle at $260.0000. Retailers
OKZIM trimmed 2.40% to $30.5187 while, Art Holdings slipped 0.65% to
$15.4000. First Capital Bank completed the top five losers' list after a
0.53% slump to $9.0327. Seventeen counters gained ground against eight
counters that lost their grip to see the market close with a positive
breadth of nine. Activity aggregates were depressed in the

session as turnover dropped by 89.55% to $132.84m while, volumes decreased
by 88.95% to 1.55m. NMB, Simbisa, Econet and Mash Holdings were the top
volume drivers as

contributed a combined 85.47% to the outturn. Simbisa, Econet, NMB, Meikles
and Delta contributed 64.39%, 14.20%, 7.222%, 5.65% and 3.44% to the value
aggregate respectively. On the VFEX, Padenga slid 0.04% to USD$0.2799 while,
Seed Co International hopped 2.77% to close at USD$0.3597. The Datvest ETF
and MIZ ETF edged up 0.42% and 0.83% to $1.7071 and $1.2100 accordingly.
Contrastingly, the Morgan and Co ETF and the Old mutual ETF shed 9.09% and
1.77% with the former closing at $20.0000 and the latter at
$5.6000.-efesecurities

Global Currencies & Equity Markets

South Africa

Rand rallies to its highest in nearly 10 weeks

The rand rallied to its highest in nearly 10 weeks amid a softer dollar and
expectations of a prolonged aggressive hiking cycle by the South African
Reserve Bank (SARB) to curb elevated consumer prices.

The domestic currency appreciated 0.8% yesterday to R17.11 to the US dollar,
the highest since September 12, amid the greenback's losses as investors
awaited the latest US Federal Reserve (Fed) meeting minutes that could offer
clues on the central bank's future tightening plans, after buoyant corporate
earnings in the US and remarks by Fed policymakers that indicated they were
open to slowing the pace of rate hikes

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TreasuryONE currency strategist Andre Cilliers said although the rand was
gaining momentum, it was still caught in the R17.20 to R17.50 range for now.

"We will require new impetus for the rand to break the current range, but
with the long weekend in the US and the release of the FOMC minutes, the
lack of liquidity in the market can cause some volatile moves possibly,"
Cilliers said.

In terms of inflation, both headline and core inflation surprised on the
upside in October, rising from 7.5% to 7.6% and from 4.7% to 5%,
respectively, suggesting persistent inflationary pressures.

The SARB is set to deliver another big rate hike of at least 75 basis points
at the last meeting of the Monetary Policy Committee (MPC) for the year
today.

Interest rates are the only tool used by the central bank to tame hot
inflation, despite heightened risks to the domestic economic outlook,
including global headwinds and record power outages.

However, petrol prices (inland 95) fell by a cumulative R3.06 cents per
litre during September and October, which has driven a deceleration in
transport inflation.

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Nonetheless, SARB Governor Lesetja Kganyago recently cited the need to get
inflation expectations more anchored around the midpoint of its target range
of 3% to 6%.

Meanwhile, the JSE FTSE All Share Index was up 0.9% to trade at 72 908 index
points, propped up by the recovery in tech stocks and strength in
resource-linked companies.

BUSINESS REPORT

Nigeria

Nigeria hopes new currency notes curb inflation, corruption

ABUJA, Nigeria (AP) - Nigeria on Wednesday launched newly designed currency
notes, a move that the West African nation's central bank says will help
curb inflation and money laundering.

The newly designed denominations of 200 (5 U.S. cents), 500 ($1.10) and
1,000 naira ($2.20) also would drive financial inclusion and economic
growth, said Godwin Emefiele, governor of the Central Bank of Nigeria.

Experts, however, are skeptical about such results in a country that has
battled chronic corruption for decades, with government officials known to
loot public funds that has caused more hardship for the many struggling with
poverty.

Nigeria's currency has not been redesigned in 19 years, and the new
initiative is the latest introduced by policymakers in Africa's biggest
economy in their quest for a cashless and more inclusive economy.

The naira is "long overdue for a new look," Nigerian President Muhammadu
Buhari said at the launch. The new paper notes designed in Nigeria and
featuring enhanced security "will help the central bank to design and
implement better monetary policy objectives."

More than 80% of the 3.2 trillion naira ($7.2 billion) in circulation in
Nigeria are outside the vaults of commercial banks and in private hands,
Emefiele said. Regulators last month announced a Jan. 31 deadline for old
notes to either be used or deposited at banks.

With inflation at a 17-year high of 21.09% that is driven by soaring food
prices, Emefiele said the new notes "will bring the hoarded currencies back
into the banking system" and help the central bank regain control of the
money being used in the country.

"The currency redesign will also assist in the fight against corruption as
the exercise will reign in the higher denomination used for corruption and
the movement of such funds from the banking system could be tracked easily,"
the central bank chief said.

Analysts, however, say that the newly designed notes would yield little or
no results in managing inflation or in the fight against corruption in the
absence of institutional reforms.

"If you want to curb money laundering, your financial system needs to be
better; if you want to curb ransom payment, security needs to be better; if
you want to curb inflation, the level at which the total money supply in the
economy is growing has to slow down - so it is not about cash," said Adedayo
Bakare, an analyst with Lagos-based Money Africa.

Bakare said the move by Nigeria's central bank is at best an "expensive
process that will cost the public a lot of pain because of the short period"
required to either use or deposit cash in circulation.

At least 133 million people, or 63% of Nigeria's citizens, are
multidimensionally poor, according to government statistics.

"It could potentially slow down the economy if people do not have cash and
people cannot exchange their cash for new notes at a fast pace," he said.
"You can't phase out cash without fixing financial inclusion or electronic
payment and even at that."

 <mailto:info at bulls.co.zw> 

Global Markets

Dollar slips as risk sentiment improves after Fed minutes

(Reuters) - The U.S. dollar was broadly weaker on Thursday as investors,
encouraged the prospect of a slower pace of interest rate hikes from the
Federal Reserve, placed bets on riskier assets.

The eagerly awaited readout of the Nov. 1-2 Fed meeting showed officials
were largely satisfied they could now move in smaller steps.

"I think now it is almost certain that we'll see the FOMC slow its pace of
tightening from December," said Carol Kong, a currency strategist at the
Commonwealth Bank of Australia (CBA).

The dollar index , which measures the greenback against six major peers, was
down 0.066% at 105.830, after sliding 1% overnight.

This month, the Fed raised its key rate by three-quarters of a percentage
point for the fourth straight time in an effort to tame stiflingly high
inflation.

But slightly cooler-than-expected U.S. consumer price data has stoked hopes
of a more moderate pace of hikes. Those hopes have seen the dollar index
slide 5.1% in November, putting it on track for its worst monthly
performance in 12 years.

Citi strategists said there is still substantial uncertainty around how high
rates might climb, despite the consensus that rates will rise more slowly.

The minutes also showed an emerging debate within the Fed over the risks
that rapid policy tightening could pose to economic growth and financial
stability. At the same time, policymakers acknowledged there had been little
demonstrable progress on inflation and that rates still needed to rise.

Data on Wednesday showed U.S. business activity contracted for a fifth
straight month in November, with a measure of new orders dropping to its
lowest level in 2-1/2 years as higher interest rates slowed demand.

CBA's Kong cautioned, however, that the markets are too optimistic about a
possible imminent end to the tightening cycle and noted there was still
heavy support for the U.S. dollar due to China's zero-COVID polices.

Rising coronavirus cases have led Chinese cities to impose more curbs,
increasing investor worries about the economy and putting a lid on risk
appetite.

The Australian dollar rose 0.25% versus the greenback at $0.675, while the
kiwi was 0.26% higher at $0.625.

The euro was up 0.23% at $1.0419, while sterling was last trading at
$1.2083, up 0.26% on the day. The pound rose 1.4% overnight after
preliminary British economic activity data beat expectations, though it
still showed that a contraction was underway.

The Japanese yen strengthened 0.54% versus the greenback to 138.84 per
dollar.

U.S. markets will be closed on Thursday for Thanksgiving and liquidity will
likely be thinner than usual.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold price a bit weaker as FOMC minutes on deck

(Kitco News) - Gold prices are slightly lower and silver a bit higher in
subdued early U.S. trading Wednesday. The marketplace is quieter ahead of
the U.S. data point of the week: the FOMC minutes released at 2:00 p.m. EST.
December gold was last down $2.80 at $1,737.20 and December silver was up
$0.131 at $21.18.

Today is the busiest day for U.S. economic data this holiday-shortened
trading week, including the minutes from the last FOMC monetary policy
meeting, to be released in the early afternoon. The minutes may contain a
few new clues on the future path and timing of Fed monetary policy. U.S.
markets are closed on Thursday for the Thanksgiving holiday.

Most global stock markets were slightly up overnight. U.S. stock indexes are
headed for slightly higher openings when the New York day session begins.
The marketplace remains tentative at mid-week as Covid-19 cases in China
continue to rise and are crimping the world's second-largest economy.
Newswire reports this morning quoted Chinese officials as saying they will
further ease China's monetary policies in an effort to produce more economic
growth.

Meantime, the Euro zone reported its November manufacturing purchasing
managers index (PMI) at 47.3, which was slightly above market expectations
and compares to the October reading of 46.4. Still, a reading below 50.0
suggests contraction in the sector. It was the fifth month in a row of
manufacturing sector contraction for the Euro zone.

SBF's actions could be criminally 'negligent', FTX allegedly misappropriated
customer funds - Joseph Borg

The key outside markets today see the U.S. dollar index slightly lower.
Nymex crude oil prices are lower and trading around $79.00 a barrel. The
yield on the benchmark U.S. 10-year Treasury note is presently 3.756%.

Other U.S. economic data due for release Wednesday includes the weekly
jobless claims report, the weekly MBA mortgage applications survey, durable
goods orders, the U.S. flash services and manufacturing purchasing managers
indexes (PMI), new residential sales, the University of Michigan consumer
sentiment survey and the weekly DOE liquid energy stocks report.

Technically, the gold futures bulls and bears are on a level overall
near-term technical playing field. Bulls' next upside price objective is to
produce a close above solid resistance at the November high of $1,791.80.
Bears' next near-term downside price objective is pushing futures prices
below solid technical support at $1,700.00. First resistance is seen at the
overnight high of $1,746.30 and then at this week's high of $1,755.00. First
support is seen at the overnight low of $1,733.00 and then at $1,725.00.
Wyckoff's Market Rating: 5.0

The silver bulls have the slight overall near-term technical advantage but
have faded. A choppy, 2.5-month-old uptrend is still in place on the daily
bar chart. Silver bulls' next upside price objective is closing prices above
solid technical resistance at the November high of $22.38. The next downside
price objective for the bears is closing prices below solid support at
$19.00. First resistance is seen at $21.50 and then at $22.00. Next support
is seen at $21.00 and then at this week's low of $20.60. Wyckoff's Market
Rating: 5.5.

INVESTORS DIARY 2022

Company

Event

Venue

Date & Time

National Unity Day

December 22

Christmas Day

December 25

Boxing Day

December 26

Counters trading under cautionary

CBZH

Meikles

Fidelity

TSL

FMHL

Turnall

GBH

ZBFH

GetBucks

Zeco

Lafarge

Zimre

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
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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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