Bulls n Bears Daily Market Commentary : 08 August 2023

Tue Aug 8 21:19:16 CAT 2023

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Bulls n Bears Daily Market Commentary : 08 August 2023

ZSE commentary

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

Zimbabwe Stock Exchange (ZSE)

The overall Market Cap decreased by 0.21% to close at ZWL9.72 trillion
today. However, there was improved liquidity compared to last week. Total
turnover decreased by 67.81% to close at ZWL 1.19 billion and total volumes
traded declined by 78.83% to close at ZWL 1.49 million. Delta, Tanganda Tea
Co. Ltd, and NMBZ Holdings were today's most traded counters, with a total
contribution of 96.96% to the total turnover. 

The benchmark All-Share Index lost 0.24% and closed at 121,953.93 points at
the back of 11 risers against 10 decliners. The Top 15 Index slid by 0.35%
to close at 78,370.11 points while the Top 10 Index also went down by 0.42%
to 57,445.22 points. 

Trading in the positive was Fidelity Life Assurance, Bridgefort Capital Ltd
Class B, and Nampak Zimbabwe after advancing by 14.92%, 14.85%, and 13.12%,
respectively. Dairibord and ART trailed the list after gaining 4.95% and
3.70%, closing at $405.00, and $46.67, respectively. 

The shakers list for today was led by Zimre Holdings and Star Africa
Corporation which reversed their last week's gains by 14.81% and 6.73%,
respectively. FBC Holdings, First M. Limited, and Delta were also among the
defeated after pulling back by 3.55%, 1.53% , and 1.12%, respectively.

Victoria Falls Stock Exchange (VFEX)

The VFEX All Share Index lost 0.43% to close at 68.85 points.

Global Currencies & Equity Markets

South Africa

South African rand extends losses on weak China data

(Reuters) - South Africa's rand slipped again on Tuesday as weak economic
data from China kept investors away from risk-sensitive currencies.

At 1506 GMT, the rand traded at 19.0025 against the dollar , down around
1.6% from its previous close. The currency has lost more than 6% against the
greenback this month.

The dollar last traded around 0.56% stronger at 102.65 against a basket of
global currencies.

"Granted, the rand is one of the worst emerging-market performers, but much
of this can be attributed to the fact that it is among the most liquid
emerging-market currencies and thus when global sentiment turns, it is one
of the first to feel the pressure," said Rand Merchant Bank analysts in a
research note.

Chinese data showed on Tuesday that both imports and exports fell more than
expected, pointing to softening global demand.

"A global slowdown may encourage major developed markets' central banks to
ease off their tightening, but it also means the possibility of financial
market volatility and a rise in risk aversion," ETM Analytics said.

With little local data and a public holiday on Wednesday, traders will turn
their attention to Chinese and U.S. inflation data due later this week.

Local contributors to rand weakness include an ongoing minibus taxi strike
in South Africa's Western Cape province, leaving some commuters unable to
work, local media reported.

"Investors will carefully monitor developments concerning the taxi strike
and the violence generated. The quicker this strike ends, the quicker the
rand will experience less depreciative pressure," ETM added.

On the Johannesburg Stock Exchange, the blue-chip Top 40 index (.JTOPI)
closed around 0.34% weaker.

South Africa's benchmark 2030 government bond was slightly stronger, with
the yield 3 basis points lower at 10.215%.

The Thomson Reuters Trust Principles.

Nigeria

Naira drops against Dollar, exchanges at N774 

The week started negatively as the Naira depreciated against the Dollar,
exchanging at N774.78 at the official foreign exchange market window.

According to NAN, on Monday, the Naira lost by 4.27 per cent compared with
N743.07, which it exchanged for after the close of business on Aug. 4.

The open indicative rate closed at N771.64 to the Dollar on Monday.

A spot exchange rate of N799 to the Dollar was the highest rate recorded
within the day’s trading before it settled at N774.78.

The Naira sold for as low as N475 to the Dollar within the day’s trading.

On Monday, $45.98 million was traded at the official market window.

Financial expert, Muda Yusuf, Director of the Centre for the Promotion of
Private Enterprise, said the Central Bank of Nigeria should introduce an
urgent monetary policy to curb forex volatility.

 <mailto:info at bulls.co.zw> 

Global Markets

US dollar gains broadly as risk sentiment turns sour after poor Chinese data

(Reuters) - The U.S. dollar firmed across the board on Tuesday, garnering
safe-haven bids, after a disappointing set of Chinese trade figures hurt the
yuan and the Australian and New Zealand currencies, with European
risk-sensitive currencies also sliding on the worsening global outlook.

The dollar index rose 0.6% to 102.69, moving further away from Friday's
one-week low in the wake of a mixed U.S. jobs report, which pointed to a
cooling but still resilient labour market. The greenback was on track for
its best daily gain in about two weeks.

China's imports and exports fell much faster than expected in July, data on
Tuesday showed, with imports down 12.4% from a year earlier while exports
contracted by 14.5%, in another sign of the country's faltering economic
recovery and subdued global demand.

"There's an element of risk aversion. Pretty clearly, the data overnight was
not so good, with very sluggish export data across Asia," said Brad Bechtel,
global head of foreign exchange, at Jefferies in New York.

"We're definitely at a place in the dollar smile where U.S. fundamentals are
outperforming the rest of the world. And generally it's an environment for
the dollar to sustain its rally," he added.

The offshore yuan fell to a five-week low of 7.2514 per dollar, and was last
down 0.6% at 7.246. Its onshore counterpart hit a three-week low of 7.2225
per dollar.

The Aussie , a proxy for risk-sensitive currencies that is directly impacted
by the yuan, weakened to US$0.6497 against the U.S. currency, its lowest
since June 1. It last traded down 0.9% at US$0.6510. The New Zealand dollar
dropped to US$0.6035, its weakest level in two months and was last down 1%
at US$0.6041.

While currency moves had been minimal early in the Asian day, the greenback
extended its gains in Europe and North America, as risk sentiment turned
fragile and Wall Street shares sold off.

In other currencies, sterling fell 0.5% to $1.2718, after a survey showed
British retailers in July logged their slowest sales growth in 11 months.

The euro dropped 0.5% to $1.0949, while the risk-sensitive Swedish and
Norwegian crowns both tumbled against the dollar.

"Both SEK and NOK have had some good sessions, when they were supported by
positive risk sentiment, but are for the opposite reason slightly on the
defensive," said Jens Nærvig Pedersen, director at Danske Bank.

The U.S. dollar rose 0.4% to 143.095 yen .

Data on Tuesday showed that Japanese real wages fell for a 15th straight
month in June on relentless price hikes, but nominal pay growth remained
robust amid rising salaries for high-income workers and a broadening labour
crunch.

All eyes are now on Thursday's U.S. inflation data, where expectations are
for core consumer prices in the United States to have risen 4.8% on an
annual basis in July.

China will report July inflation as well on Wednesday, with traders on the
lookout for further signs of deflation.

========================================================

Currency bid prices at 10:52AM (1452 GMT)

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold hits 4-week low as dollar firms before US inflation test

Gold hit a four-week low on Tuesday as the dollar climbed after
weaker-than-expected Chinese trade data, while caution in the run-up to U.S.
inflation readings this week also kept appetite for zero-yield bullion
subdued.

Spot gold was down 0.4% to $1,928.61 per ounce by 1200 GMT after hitting its
lowest since July 11. U.S. gold futures fell 0.4% to $1,963.00.

"China's weak trade data has resulted in a general risk-off sentiment. The
haven of choice today has been the greenback, which has put pressure on the
precious metal," said FXCM market specialist Russell Shor.

The dollar gained 0.6% but losses for dollar-priced bullion were capped by a
downturn in benchmark 10-year Treasury yields from November 2022 highs hit
on Friday.

"Gold prices remain under pressure from the recent rise in U.S. bond yields
and after Fed's Bowman said more rate hikes may be needed," said Saxo Bank's
head of commodity strategy Ole Hansen.

Fed Governor Michelle Bowman on Monday outlined the likely need for
additional rate hikes to lower inflation to the Federal Reserve's 2% target,
while New York Fed chief John C. Williams expected that rates could begin to
come down next year.

"The sixty-four-dollar question this week is the U.S. inflation outcome,"
said Clifford Bennett, chief economist at ACY Securities.

A hotter-than-expected CPI number on Thursday could raise the possibility of
another rate hike in September.

"The market already knows headline inflation is trending lower, but any
firmness in the data could be a fresh downward catalyst for gold in the
short term," Bennett added.

Rate hikes tend to lift bond yields, raising the opportunity cost of holding
zero-yielding bullion.

Reflecting sentiment, holdings of the world's largest gold-backed
exchange-traded fund, SPDR Gold Trust, fell to a five-month low on Monday.

Silver dropped 0.9% to $22.95 per ounce, platinum eased 1.5% to $905.78,
while palladium shed 2.3% to $1,211.96.

INVESTORS DIARY 2023

Company

Event

Venue

Date & Time

Heroes’ Day

Aug 14

Defence Forces Day

Aug 15

Padenga

EGM

Royal Harare Golf Club

August 16 – (10am)

Border Timbers

EGM

4 – 12 Paisley Road, Southerton, Harare, or virtually
:https://escrowagm.com/eagmZim/Login.aspx” 

August 18 – (10am)

zIMBABWE

2023 harmonised elections

August 23

Counters trading under cautionary

CBZH

GetBucks

EcoCash

Padenga

Econet

RTG

Fidelity

TSL

FMHL

ZBFH

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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<mailto:info at bulls.co.zw> bulls at bullszimbabwe.com Tel: +263 4 2927658 Cell:
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