Bulls n Bears Daily Market Commentary : 26 April 2023

Wed Apr 26 21:30:32 CAT 2023

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Bulls n Bears Daily Market Commentary : 26 April 2023

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

ZSE commentary

ZSE records gains for the fifth consecutive session.

The market recorded gains for the fifth consecutive session as the primary
All Share Index rose 2.27% to 39198.63pts while, the Blue-Chip Index firmed
1.40% to 22506.27pts. The Mid Cap Index put on 4.73% to 86378.87pts while,
the Agriculture Index went up 0.01% to 169.45pts. Proplastics and Masimba
Holdings led the gainers of the day on a similar 14.99% jump to settle at
$136.8000 and $191.7500 respectively. FBC Holdings climbed 14.96% to
$146.0000 while, fintech group Ecocash Holdings advanced 14.94% to $49.9000.
General Beltings capped the top five winners' pack on a 14.92% uplift to end
pegged at $2.8100. Headlining the laggards of the day was First Mutual
Properties that lost 8.02% to $18.0000, followed by brick manufacturers
Willdale that retreated 7.96% to $3.5501.

Packaging group Nampak slipped 3.33% to $29.0000 while, beverages giant
Delta eased 0.73% to $790.2397. OKZIM completed the fallers' set on a
marginal 0.0012% loss to close the day pegged at $57.0018. The market closed
with a positive breadth of twelve as seventeen counters registered gains
against five counters that faltered. Activity aggregates were mixed in the
session as volumes traded ballooned 108.79% to 13.41m shares while, turnover
succumbed 51.97% to $896.76m. The top volume drivers of the day were
Willdale and OKZIM that claimed 44.02% and 40.43% apiece. Delta and OKZIM
were the top value drivers of the day after contributing a combined 85.55%
of the aggregate. On the ETFs section, Datvest grew 13.39% to $1.7013 while,
Old Mutual ETF added 0.10% to $9.3600. On the contrary, Cass Saddle and MIZ
ETFs shed 0.07% and 3.41% to $2.0500 and $1.9800 respectively. Morgan & Co
MCS ETF trimmed 7.83% to $28.0000. The Tigere REIT gained 0.03% to close the
day at $50.5272 after 2,243 units exchanged hands. - efesecurities

Global Currencies & Equity Markets

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

South Africa

South African rand steady as producer inflation slows

(Reuters) - The South African rand was steady against the dollar on
Wednesday following data showing a dip in local producer inflation.

At 1556 GMT, the rand traded at 18.3700 to the dollar , near its previous
close of 18.2675.

The dollar was down about 0.44% against a basket of currencies .

Shedding further light on inflationary pressures in Africa's most
industrialised economy, statistics agency data showed on Wednesday that
South Africa's producer inflation (ZAPPI=ECI), (ZAPPIY=ECI) slowed to 10.6%
year-on-year in March from 12.2% in February.

On a month-on-month basis, it was at 1.0% in March from 0.6% the previous
month.

Analysts polled by Reuters expected March producer inflation to fall to
10.95% in annual terms and rising to 1.4% from February.

South Africa's central bank said on Tuesday in a biannual monetary policy
document that elevated core inflation was expected to slow the pace of
disinflation in the near term.

South Africa marks Freedom Day on Thursday - which commemorates the first
post-apartheid elections held on April 27, 1994 - and with the following
Monday another public holiday, many local traders will be away from their
desks from Wednesday's market close until next Tuesday.

Shares on the Johannesburg Stock Exchange rose slightly, with both the
broader all-share index (.JALSH) and blue-chip Top-40 index (.JTOPI) ending
about 0.3% higher.

South Africa's benchmark 2030 government bond edged higher, with the yield
down 2 basis points at 10.205%.

The Thomson Reuters Trust Principles.

Nigeria

Naira drops, exchanges for N740/$ at parallel market

The Nigerian naira, on Wednesday, weakened to N740 per dollar at the
parallel section of the foreign exchange (FX) market.

The figure represents a depreciation of N3 or 0.4 percent compared to the
N737 it traded two weeks ago.

Bureaux De Change (BDC) operators, popularly known as 'abokis', who spoke to
TheCable in Alade Market, Ikeja, Lagos, quoted the buying rate of the
greenback at N732 and the selling price at N740 per dollar, leaving a N8
profit margin.

Musa, a BDC operator in the Victoria Island area of Lagos, said that buying
and selling prices stood at N733/$ and N740/$, respectively.

He said there was still low demand for the greenback in the street market.

"Currently, people are hardly buying dollars in the market," Musa told
TheCable.

At the investors and exporters (I&E) forex window, the local currency
appreciated by 0.05 percent to close at N463.44 on Tuesday, according to
details on FMDQ OTC Securities Exchange - a platform where FX is officially
traded.

The data also showed that forex worth $62.69 million were transacted among
market dealers.

Currently, Nigeria operates two foreign exchange (FX) markets: one is the
official central bank rate, while the other is the parallel/street market
rate.

Although the parallel segment is more accessible to traders and businesses
who need FX, the Central Bank of Nigeria (CBN) has consistently maintained
that it represents less than one percent of forex transactions and should
never be used to determine the exchange rate.

Recently, the World Bank advised the Nigerian government to restore
macroeconomic stability by intensifying efforts towards exchange rate
unification as well as reducing inflation.

"The authorities can strengthen the economy by restoring macroeconomic
stability through reforms to (i) increase oil and non-oil revenues, (ii)
tighten monetary policies to reduce inflation, and (iii) unify the multiple
FX windows and adopt a single, market- responsive exchange rate," the
Bretton Woods institution had said.-thecable

 <mailto:ibc at zitf.co.zw> 

Global Markets

Euro to Dollar Rate Hits New One-year Best

The Euro to Dollar exchange rate (EUR/USD) hit 1.1095 in midweek trade
meaning dollar buyers holding euros were looking at their best exchange rate
in over a year.

EUR/USD has risen by more than a per cent amidst a more settled global
investor sentiment with the previous day's concerns over the U.S. banking
sector rapidly fading.

"A cautious calm returned to markets," says Joe Manimbo, Senior Currency
Analyst at Convera. "The euro and sterling climbed back into positive
territory for the week, with the former back within striking distance of
recent one-year peaks."

The Dollar climbed against the Pound, Euro and other major currencies just
24 hours earlier amidst a broad pullback in global equities as investors
reacted to fresh concerns about the U.S. banking sector.

The mid-tier lender First Republic Bank said it suffered $100BN in deposit
outflows during the first quarter as banking sector fears grew following the
collapse of Silicon Valley Bank and Signature Bank.

But First Republic Bank still stands and there are no signs of stress
elsewhere in the sector, meaning fears are being pared at the time of
writing Wednesday.

The Dollar was softer as investors reacted to U.S. data that showed further
signs of a slowdown: the durable goods report showed demand for nondefense
capital goods fell by 0.4% in March, after a downwardly-revised 0.7% drop in
February.

"We think bigger falls in orders are coming over the next few months as
credit conditions continue to tighten," says Kieran Clancy, Senior U.S.
Economist at Pantheon Macroeconomics.

The prospect of a U.S. recession in the second half of the year is growing
and with it the prospect of rate cuts at the U.S. Federal Reserve, all of
which combines to undermine the Dollar.

The Euro continues to outperform as investors predict the European Central
Bank (ECB) still has some way to go in raising interest rates further.

The single currency is gaining on those currencies belonging to central
banks that have either paused (AUD, CAD) or are about to pause (USD).

Gains are less impressive against those central banks that are yet to raise
rates further, but be less than the ECB (GBP).

"The fact CHF and EUR lead the pack instead suggests that old-school central
bank relative hawkishness concerns are the real drivers within the G10
space," says Shahab Jalinoos, head of FX research and strategy at Credit
Suisse.

Credit Suisse targets EUR/USD at 1.1250 by the end of the second quarter,
"but predict a slow grind to that level given positioning and only a
lukewarm rates divergence story at this stage."

"For the USD, the downtrend since the start of March remains in place, but
it has become a grind lower rather than a meaningful drop," says Daragh
Maher, Head of Research for the Americas at HSBC.

"The EUR continues to capitalise on the possibility, however slim, of

a 50bp hike next week at the ECB," he adds.

The near-term risk to the Euro-Dollar uptrend is indeed next week's ECB
meeting and anything less than a 50bp hike could undermine the Euro.

The market is fully invested in ECB hawkishness, therefore any hints that it
is ready to ease back on this stance could cause a rapid repricing in
expectations that could deflate the Euro's sails.

But Eurozone data would need to take a material turn for the worse before
such an outcome is realised, particularly as the economy continues to
surprise: most recently April consumer confidence data for Germany and
France both came in higher than expected.

Inflation is well ahead of the ECB's 2.0% target and is unlikely to turn
materially lower until wage price growth begins to cool.

May could therefore be too soon for the ECB to undermine the Euro's trend of
appreciation.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold pulls back after brief run to $2,000 on U.S. banking woes

(Reuters) - Gold eased back on Wednesday as yields recovered with the focus
returning to upcoming economic data, after briefly breaking above $2,000
spurred by fresh worries surrounding the U.S. banking turmoil.

Spot gold fell 0.6% to $1,985.80 per ounce by 12:25 p.m. EDT (16:25 GMT)
after jumping as high as $2,009.32 earlier. U.S. gold futures slipped 0.4%
to $1,996.20.

First Republic Bank's (FRC.N) shares hit a record low after a report said
the U.S. government was unwilling to intervene in the rescue process for the
troubled lender.

Advertisement . Scroll to continue

"That was the catalyst for gold prices to revisit slightly higher levels,"
said Daniel Ghali, commodity strategist at TD Securities.

But overall, trend-following algorithms have effectively reached their
maximum long positions, Ghali added.

Benchmark U.S. Treasury yields recovered from a near two-week low, raising
the opportunity cost of holding zero-yield bullion.

Gold declined despite the dollar shedding 0.4%, while investors also took
stock of upbeat risk sentiment driven by strong earnings.

Traders were now focused on U.S. quarterly GDP data due on Thursday,
followed by the core personal consumption expenditures index on Friday, the
Fed's preferred inflation gauge.

Markets had priced in about a 3-in-4 chance of the U.S. central bank raising
rates by 25 basis points at its May 2-3 meeting.

Those odds were lower due to "resurgent fears that there's always more than
one cockroach when it comes to the U.S. regional banking crisis," Ghalli
said.

Safe-haven gold scaled an over one-year peak at $2,048.71 mid-April as the
U.S. banking crisis unfolded.

"Retail, discretionary traders and the like remain very underexposed, a
source of dry powder, especially if the market ramps up rate cut
expectations," said Paul Wong, market strategist at Sprott Asset Management.

Silver was down about 1% to $24.8 an ounce, platinum gained 0.2% to
$1,088.50 and palladium rose 1.9% to $1,511.23.

INVESTORS DIARY 2023

Company

Event

Venue

Date & Time

Workers' Day

May 1

Africa Day

May 25

Counters trading under cautionary

CBZH

TSL

Fidelity

Willdale

FMHL

ZBFH

GetBucks

Zimre

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
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for guideline purposes only and sourced from third parties.

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