Bulls n Bears Daily Market Commentary : 13 December 2023

Thu Dec 14 07:31:02 CAT 2023

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Bulls n Bears Daily Market Commentary : 13 December 2023

ZSE commentary

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

ZSE inches up amidst low activity.

The ZSE inched up amidst low trading activity on the bourse as only
twenty-two counters registered trades in the session. The market closed with
a negative breadth of four as six counters advanced against ten that
declined. The All-Share Index was 0.36% firmer at 198,516.91pts while, the
Blue-Chip Index added 0.47% to close pegged at 84,413.11pts. The Mid Cap
Index gained 0.15% to 875,009.02pts while, on the contrary the Agriculture
Index was 0.99% weaker at 599.35pts. Headlining the gainers' list of the day
was brick manufacturer Willdale that garnered 33.33% to $40.0000 while,
fintech group Ecocash charged 14.64% to close at a VWAP of $139.5686.
Property concern Mashonaland Holdings was 2.14% up at $143.0000 while,
retailer OK Zimbabwe added 0.12% to settle at $195.2378. Telecommunication
giant Econet fastened the winners of the day on scrappy gains of 0.05% to
close trading at $719.3068. Trading in the negative territory were SeedCo
that retreated 5.46% to $813.0541, followed by Meikles that dropped 3.41% to
settle at $1,300.0000. Sugar producer Hippo eased 2.37% to close at
$1,855.0000 while, Zimre Holdings was 0.96% weaker at $182.5508. Packaging
group Nampak capped the worst performers of the day as it fell 0.67% to
$298.0000 as scrappy 100 shares exchanged hands in the counter.

Activity aggregates faltered in the session as volumes declined 82.49% to
see 1.15m shares worth circa $1.60bn exchange hands in the session. This
represented a 44.71% decline in value traded. Volume drivers of the day were
Delta, FBC, SeedCo and Star Africa with respective contributions 27.23%,
17.50%, 15.19% and 11.89%. Delta dominated in the value category as it
claimed 67.97% of the outturn. The other notable value contributor was FBC
with a 11.89% claim of the total. In the ETF category, the Morgan & Co Multi
Sector ETF was the only fund to register price movement as it let go 10.71%
to trade at $500.0000. A total of 31,100 units worth $280,060.00 traded in
the session. The Tigere REIT edged up 0.38% to $299.9609..-efe

Global Currencies & Equity Markets

South Africa

South African rand slips ahead of inflation data

Eyes will be on Statistics South Africa at 0800 GMT, when it releases
inflation figures for November. Analysts polled by Reuters predict headline
inflation of 5.6% in November on the year.

The focus of global markets later in the day will turn to an interest rate
decision by the U.S. Federal Reserve and its policy outlook.

On the stock market, the benchmark Top-40 .JTOPI index was little changed in
early trade.

South Africa's benchmark 2030 government bond ZAR2030= was marginally weaker
in early deals, with the yield up 1.5 basis points at 10.095%.

The views and opinions expressed herein are the views and opinions of the
author and do not necessarily reflect those of Nasdaq, Inc.

Nigeria

Naira falls to N1260/$ in parallel market

The naira depreciated yesterday to N1,260 per dollar in the parallel market
from N1,220 per dollar on Tuesday.

Similarly, the naira depreciated to N904.65 per dollar in the official
Nigerian Foreign Exchange Market (NAFEM).

Data from FMDQ showed that the indicative exchange rate for NAFEM rose to
N904.65 per dollar from N865.03 per dollar on Tuesday, indicating a  N39.62
depreciation for the naira.

As a result, the gap between the official and parallel market exchange rates
widened to N355.35 per dollar yesterday from N354.97  per dollar on Tuesday.

The volume of dollars traded on NAFEM increased by 22 percent to $120.89
million from $99.09 million traded on Tuesday.

Vanguard News

 <mailto:info at bulls.co.zw> 

Global Markets

Dollar takes a dive after Fed signals rate cuts next year

(Reuters) - The dollar was under pressure on Thursday after the Federal
Reserve's latest economic projections indicated that the interest-rate hike
cycle has come to an end and lower borrowing costs are coming in 2024.

Both the euro and Japanese yen jumped in response, with the European Central
Bank (ECB) preparing to announce its policy decision later on Thursday and
the Bank of Japan coming up next week.

Fed Chair Jerome Powell said at Wednesday's Federal Open Market Committee
(FOMC) meeting that the historic tightening of monetary policy is likely
over, with a discussion of cuts in borrowing costs coming "into view."
Policymakers were nearly unanimous in their projections that borrowing costs
would fall in 2024.

"This is a huge development for markets as we head into the new year and
provides much-needed clarity. And clarity in this instance meant risk-on,"
said Matt Simpson, senior market analyst at City Index.

The news from the FOMC meeting will likely overshadow upcoming economic data
before personal consumer expenditures data is published next week, leaving
room for "further downside potential for the US dollar," he added.

The U.S. dollar index , which measures the greenback against a basket of
currencies, was last 102.87 after dipping as low as 102.77 overnight.

Markets are now pricing in around a 75% chance of a rate cut in March,
according to CME FedWatch tool, compared with 54% a week earlier.

While recent economic releases have strengthened expectations that the Fed
can achieve a soft landing for the U.S. economy, Powell kept open the option
to act again if needed, noting that "the economy has surprised forecasters."

Market focus now shifts to a parade of central bank decisions, including the
ECB and the Bank of England (BoE), Norges Bank and Swiss National Bank.

With the ECB expected to hold rates steady, there will be more focus on
forecasts for GDP and inflation, "and whether and how convincingly (ECB
President Christine) Lagarde pushes back on pricing for cuts, with 100
(basis points) priced by September," National Australia Bank Senior
Economist Taylor Nugent wrote in a note.

The euro was mostly flat at $1.0882 after surging on Wednesday. Sterling was
last trading at $1.2623.

The Norwegian central bank is considered to be the only bank that could
potentially raise rates. There is also a risk the SNB could dial back its
support for the Swiss franc in currency markets.

Elsewhere, the yen sat significantly higher around 142.80 yen per dollar
following the greenback's overnight tumble.

Expectations that the Bank of Japan (BOJ) could end negative interest rates
at its monetary policy meeting on Dec. 18-19 caused the Japanese currency to
jump last week, but those hopes have largely died down after Bloomberg
reported on Monday that BOJ officials see little need to rush.

Pressure will be on BOJ Governor Kazuo Ueda next week when he's expected to
keep alive prospects of an exit while dampening anticipation of an imminent
move.

In cryptocurrencies, bitcoin was up at $42,904.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold climbs over 1% as Treasury yields tumble and dollar weakens

Gold prices rose more than 1% on Wednesday as the U.S. dollar index and
Treasury yields fell after the U.S. Federal Reserve flagged an end to its
interest rate hike cycle,

Spot gold gained 1.3% to $2,004.79 per ounce as of 2:34 p.m. ET (1934 GMT).
U.S. gold futures settled 0.2% higher at $1,997.30.

The U.S. central bank held interest rates steady on Wednesday. A near
unanimous 17 of 19 Fed officials project the policy rate will be lower by
the end of 2024 than it is now, with the median projection showing the rate
falling three-quarters of a percentage point from the current 5.25%-5.50%.

"The Fed's acknowledgement of inflationary pressures continuing to come down
has raised interest rate cut expectations, which is seeing a dramatic drop
in yields and dollar, and a subsequent rise in gold and silver," said David
Meger, director of metals trading at High Ridge Futures.

"We believe the current upward move in gold is a sustained rally."

The dollar index slipped 0.6% after the Fed verdict, making gold less
expensive for overseas buyers. U.S. 10-year Treasury yields extended its
retreat.

The yield on the 10-year Treasury hit its lowest level since August after
the Federal Reserve held rates steady for a third consecutive meeting and
set the stage for three cuts in 2024. The 10-year Treasury dropped 19 basis
points to 4.016%. 

Traders are now pricing in a near 60% chance of U.S. rate cuts in March
2024, according to the CME Fedwatch tool.

Lower interest rates increase the appeal of holding zero-yield bullion.

Fed Chair Jerome Powell said inflation has eased without significant rise in
unemployment and that full effects of tightening is likely not yet felt.

Data showed U.S. producer prices were unexpectedly unchanged in November,
indicating inflation at the factory gate continued to subside.

Gold's trajectory could also be influenced by policy meetings of the
European Central Bank and the Bank of England on Thursday.

Silver rose 2.5% to $23.32 per ounce, while platinum rose 0.1% to $930.56,
and palladium was up 0.5% to $983.83.

INVESTORS DIARY 2023

Company

Event

Venue

Date & Time

Counters trading under cautionary

CBZH

GetBucks

EcoCash

Padenga

Econet

RTG

Fidelity

TSL

FMHL

ZBFH

Invest Wisely!

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