Bulls n Bears Daily Market Commentary : 11 July 2023

Tue Jul 11 21:02:57 CAT 2023

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Bulls n Bears Daily Market Commentary : 11 July 2023

ZSE commentary

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

Zimbabwe Stock Exchange (ZSE)

.       The overall Market Cap for today decreased by 8.53% close at
ZWL11.31 trillion. Total turnover dropped by 27.17% to close at ZWL1.84
billion, following a decrease of 78.51% in the total volumes traded which
later closed at ZWL1.83 million. Delta, Econet and Fbc Holdings were today's
three most traded counters, with a contribution of 94% to the total
turnover.

.       The benchmark All-Share Index dropped by 7.24% to close with
141,044.14 points at the back of 10 raisers and 16 decliners. The Top 15
Index lost 8.60% to 92,740.34 points with the Top 10 Index also decreasing
by 9.76% to close with 68,948.72 points.

.       Getbucks Microfinance and Nampak Zimbabwe topped the movers list for
the day after adding 15.00% each to close at $43.70 and $136.85,
respectively.  General Beltings Holdings, Ariston and Turnall capped the
risers' list after advancing by 10.00%, 8.92% and 2.28% to close at $11.00,
$33.93 and 13.30,respectively.

.       Trading on top of the decliners' list for the day was Econet and
First M. Limited after each lost 15.00% and 14.87% to close at $625.15 and
$230.00, respectively. Delta and Fbc Holdings decreased by13.77% and 11.76%
to close at $2,250.59 and $1,050.00, respectively.  Zimre Holdings capped
the list after dropping by 10.80% to close at $88.93.

Victoria Falls Stock Exchange (VFEX) 

.       The VFEX All Share Index gained 0.12% to close with 74.47 points

 <mailto:info at bulls.co.zw> 

Global Currencies & Equity Markets

South Africa

South African rand firms on strong local data, weak dollar

(Reuters) - South Africa's rand strengthened on Tuesday following improved
local manufacturing output and a weak dollar spurred by expectations of an
end to rate hikes in the U.S.

The rand traded at 18.53 against the dollar at 1443 GMT, up 1.3% on its
previous close.

Data from Statistics South Africa showed the country's manufacturing output
rose by 2.5% year-on-year in May after advancing by a revised 3.6% in April.

The rise in output was just the second time this year, following six
consecutive months of decline.

Thanda Sithole, senior economist at local lender FNB, said that despite the
data, the sector's outlook remains uncertain.

"The manufacturing sector remains fragile and clouded," said Sithole, adding
that power cuts, infrastructure failure and moderating demand could weigh
down the industry.

In addition, rand strength was driven by a fall in inflation expectations in
the United States despite the Federal Reserve saying it could hike rates
further.

The currency markets are "disregarding the hawkish bias favoured by Fed
officials", said Warren Venketas, an analyst at Daily FX, pushing the
greenback down.

Shares on the Johannesburg Stock Exchange (JSE) firmed, led by industrials
such as Shoprite (SHPJ.J) and precious metals miners including Impala
Platinum (IMPJ.J) and Anglo American Platinum (AMSJ.J).

The benchmark all-share index (.JALSH) ended up 0.58% to 74,775 points while
the blue-chip index of top 40 companies (.JTOPI) ended the day up 0.51% to
69,453 points.

The main indexes have lost over 7% since reaching all-time highs earlier
this year, driven primarily by a sluggish economy, inflationary pressures
and rampant power cuts.

Yield on South Africa's benchmark 2030 government bond was marginally down
to 10.725% on strong local data.

Nigeria

Naira gains 4.4% over strong non-bank corporates inflow

After significant downward pricing, the Nigerian naira saw a sharp
appreciation on Monday against the dominant US dollar as demand for imports
was met with sizeable foreign currency supply in the market.

Data from FMDQ Exchange indicated that the naira appreciated by 4.4% to
N744.07 per US dollar from N776.90 at the Investors' and Exporters' foreign
exchange window. In the open market, the local currency depreciated, with
the Naira falling 0.36% to N792.5 from N792.

Last week, the non-deliverable forward market rate suggests the local
currency will hit N785 per greenback in a month's time. Some foreign
currency analysts and investment bankers told MarketForces Africa that
exchange rate movements depend largely on the weight of FX demand versus the
volume of US dollars available on the supply side.

In its update, Coronation Research stated that the Nigerian Autonomous
Foreign Exchange Fixing (NAFEX) rate traded within the range of N600-841 but
closed at N776.9 per greenback last week.

This points toward a depreciation of -1% or N7.7 over the five days trading
session ended on Friday. In the forwards market, FX traded within the range
of N751-824.

In the 1-month contract, the naira exchange rate depreciated by -0.05% to
close at N801.2, and in the 3-month contract, fx depreciated by -0.04% to
close at N820.2 per US dollar request.

Meanwhile, in the parallel market, the Naira closed at an average of N785,
which translated to a 1% gap between the NAFEX and the parallel market rate.

Data from the FMDQ platform showed that NAFEX turnover decreased by 4.5%
last week to USD 440.65 million. The NAFEX window recorded an inflow of
USD360 million, Coronation Research said.

The breakdown of the sum showed that CBN accounted for 3.3%, foreign
portfolio investors (FPIs) accounted for 8.4%, non-bank corporates accounted
for 32.5%, exporters accounted for 49.5%, and others accounted for 6.3%.

Ahead of a $500 million maturing Eurobond ready for repayment, Nigeria's
external reserves declined by -0.2% or USD60.27 million to USD34.1 billion
despite a surge in global oil prices.

Brent crude rose 0.19% to $78.32 per barrel yesterday, while WTI crude
gained 0.46% to $73.52 per barrel. Oil futures fell on Monday, as traders
assessed deflation fears in the top oil importer, China.

 <mailto:info at bulls.co.zw> 

Global Markets

Dollar skids to two-month low, pound climbs to 15-month peak on wage growth
data

(Reuters) - The dollar dropped to a two-month low against a major currency
index on Tuesday, after Federal Reserve officials signalled that the central
bank is near the end of its tightening cycle, while sterling hit a 15-month
high after pay growth exceeded expectations.

Against the yen, the dollar fell to a four-week trough of 140.17. It last
traded down 0.7% at 140.335 yen. The U.S. currency also plunged to its
lowest in two-and-a-half years versus the Swiss franc, and was last at
0.8799 francs, down 0.6%.

Several Fed officials said on Monday the central bank would likely need to
raise interest rates further to bring down inflation but the end to its
current monetary policy tightening cycle was getting close.

The comments knocked the greenback to a two-month low of 101.66 against a
basket of currencies , as traders pared back their expectations about how
much further U.S. rates may have to rise. The dollar index was last down
0.2% at 101.69.

"Friday's NFP (nonfarm payrolls) report revealed, for the first time since
COVID, potential cracks in the U.S. labor market, hinting that the Fed may
have to settle on just a single rate hike in the second half of the year,"
said Matt Weller, global head of research at Forex.com and City Index.

The June non-farm payrolls report showed the fewest job gains in 2-1/2
years.

"Meanwhile, this morning's strong UK wage growth data and the ongoing short
squeeze in the Japanese yen are driving two of the greenback's biggest
rivals higher as traders anxiously await tomorrow's U.S. CPI report," Weller
added.

Expectations are for core U.S. consumer prices to have risen 5% on an annual
basis in June. The CPI data should provide more clarity on the Fed's
progress in its fight against stubbornly high inflation.

"Market participants should remember that U.S. data releases still have the
capacity to shock: if the core or 'supercore' inflation measures surprise to
the upside, front-end yields could leg higher once again, and the dollar
might stage a surprising rebound," said Karl Schamotta, chief market
strategist at Corpay in Toronto.

EUROPEAN CURRENCIES STRENGTHEN

Sterling hit a near 15-month high of $1.2934 after British wage growth hit a
joint record high, heaping pressure on the Bank of England to tighten policy
further to bring inflation under control. It was last up 0.5% at $1.2920.

The pound has been rallying on a stronger economy and aggressive repricing
of expectations for tighter BoE policy, analysts said.

The euro rose to two-month peaks of $1.1027 , and last changed hands at
$1.1006, up slightly in the day.

Other European currencies were also strong, with the Norwegian crown hitting
a near three-month high and the Swedish crown at a two-week peak against the
dollar.

In Japan, the yen has risen more than 3% from a seven-month low touched last
month, when it weakened past the closely watched 145 per dollar level that
put traders on high alert for possible intervention from Japanese
authorities.

Elsewhere, the Australian dollar was flat at US$0.6674, while the New
Zealand currency was down 0.4% at US$0.6191 ahead of the Reserve Bank of New
Zealand policy decision on Wednesday.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold gains as dollar, yields slip ahead of US inflation data

(Reuters) - Gold prices edged higher on Tuesday as the dollar and bond
yields fell ahead of U.S. inflation data that could offer more cues on the
Federal Reserve's rate-hike path.

Spot gold was up 0.4% at $1,931.83 per ounce by 02:11 p.m. EDT (1811 GMT),
set for a third consecutive session of gains. U.S. gold futures rose 0.3% to
$1,937.10.

Making gold cheaper for holders of other currencies, the dollar index (.DXY)
fell 0.3% to its lowest level since May 11. Benchmark 10-year U.S. Treasury
yields also slipped.

"If we have a soft inflation reading, it will be positive for gold and
prices might go up to $1,950. I think it will be tough for gold to break
below $1,900 level on a hot report," said Edward Moya, senior market analyst
at OANDA.

"Rate hikes are not going to break gold's back, but it might kill the
economy. So there is some support for gold due to this reason."

All eyes are on U.S. consumer prices data due on Wednesday, which is
expected to show prices cooled on an annual basis in June.

However, markets are pricing in a 25-basis-point rate hike from the Fed
later this month after last week's jobs report pointed to a resilient U.S.
economy. FEDWATCH

Gold is used as a safe investment during times of political and financial
uncertainty, but higher interest rates increase the opportunity cost of
holding non-yielding bullion.

Spot silver fell 0.1% to $23.09 per ounce, platinum eased 0.1% to $925.76,
while palladium rose 0.8% to $1,249.94.

"In the very long term, silver is expected to trade significantly above the
$26/oz mark and should increasingly decouple from gold," TD Securities wrote
in a note.

INVESTORS DIARY 2023

Company

Event

Venue

Date & Time

Heroes' Day

Aug 14

Defence Forces Day

Aug 15

Counters trading under cautionary

CBZH

GetBucks

EcoCash

TSL

Econet

Turnall

First Capital Bank

ZBFH

Fidelity

Zimplow

FMHL

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
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