Bulls n Bears Daily Market Commentary : 19 June 2023

Tue Jun 20 06:36:18 CAT 2023

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Bulls n Bears Daily Market Commentary : 19 June 2023

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

ZSE commentary

Nampak highlights the session.

Packaging group Nampak highlighted the volume and value aggregates as 13.99m
shares worth $769.87m exchanged hands. The trade accounted for 94.50% of
total volumes and

55.95% of the turnover. The other notable value driver was Delta that
claimed 14.44% of the outturn. Volume of shares traded in the session
ballooned 1114.53% to 14.81m while, value outturn jumped 54.56% to $1.38bn.
Delta was the top faller of the day on a 10.07% tumble to $3443.8289
followed by Star Africa that dipped 8.79% to $5.3498. TSL shed 6.25% to end
pegged at $750.0000 as Ecocash trimmed 6.05% to $175.5872. Telecoms giant
Econet capped the top five shakers of the day on a 3.28% decline to
$1,013.4335. Partially mitigating today's losses were gains in CFI that
jumped 15.00% to $2,562.8000 and banking group FBC that put on a similar
15.00% to trade at $716.9000. Cable manufacturer CAFCA charged 14.99% to
$577.9000 as NTS soared 14.91% to $18.5000. Zimre Holdings capped the top
five winners' pack on a 14.55% jump to $63.0000.

The market retreated further in new week as the primary All Share Index
succumbed 3.02% to 180,652.18pts while, the Blue Chips Index trimmed 4.64%
to 107,188.13pts. The ZSE Agriculture Index added 0.95% to 704.65pts while,
the Mid Cap Index rose 2.29% to 366,029.58pts. Cumulatively, 665,470 units
worth $32.78m exchanged hands in four ETFs. The Cass Saddle ETF edged up
14.40% to $4.8327 while, the Datvest ETFimproved 6.04% to $14.9355. The Old
Mutual ETF gained 0.27% to $52.7494 while, the Morgan and Co MCS was stable
at $145.0000. The Tigere REIT climbed 9.27% to $330.0000 on 507 units.
efesecurities

 <mailto:info at bulls.co.zw> 

Global Currencies & Equity Markets

South Africa

South African rand little changed as power cuts ease

(Reuters) - South Africa's rand was little changed on Monday as a reduction
in the intensity of rolling power cuts boosted the currency.

At 1514 GMT, the rand traded at 18.1950 against the dollar , near its
previous close of 18.1900.

The dollar index , which measures the U.S. currency against six major
rivals, was up 0.16% to 102.46. It remained close to a one-month low of
102.00 it touched on Friday.

"Locally, loadshedding (blackouts) have somewhat diminished allowing for
businesses to run more efficiently and if this trend is to continue, the
rand may gain additional traction," DailyFX analyst Warren Venketas said.

Increased generation over recent days at state utility Eskom's power
stations has meant South Africans have faced electricity outages that last
less than three hours a day, a major improvement on the up to 10 hours
without power daily households and businesses have suffered over the last
year.

This week, local investors will examine May inflation figures for clues on
the health of the economy. Analysts polled by Reuters expect May
year-on-year figure to have eased to 6.5% from 6.8% reported in April.

On the stock market, both the Top-40 index (.JTOPI) and the broader
all-share index (.JALSH) fell around 0.7%.

South Africa's benchmark 2030 government bond was weaker, with the yield up
4 basis points to 10.780%.

The Thomson Reuters Trust Principles.

Nigeria

Naira weakens to 770.38/$ at official market

The naira slumped further to the dollar after closing at 770.38/$ at the end
of trading on the investor & exporter forex window on Monday.

According to figures obtained from the FMDQ on Monday, the trading rates had
closed at N686.96/$ on Friday.

Trading opened at N703.50/$ and hit a high of N799/$ before closing at
N770.38/$.

The I& E forex window recorded a total turnover of $78.03m at the close of
trading on Monday.

The Central Bank of Nigeria, last week directed Deposit Money Banks to
remove the rate cap on the naira at the I&E window to allow for a free float
of the national currency against the dollar and other global currencies.

The banking regulator explained its new forex operation in its report on
'Understanding the operational changes to the foreign exchange market'.

By collapsing all segments in the FX market into the I&E window, it said
this meant all eligible FX transactions in the market would only be done via
the I&E window, as all other windows ceased to exist.

"The I&E market functions by a willing buyer, willing seller system, where
an entity with demand for FX seeks out another entity with FX to sell at an
agreed price through an authorised dealer," the CBN stated.

On the concept of the willing buyer and willing seller model, it explained
that the rates were mutually agreed by both parties.

The CBN said PTA, BTA and other invisible transactions would continue to be
accessed through the banks at the prevailing market rate.

 <mailto:info at bulls.co.zw> 

Global Markets

Yuan slides after China cuts lending benchmarks; Aussie down

(Reuters) - The yuan slipped toward seven-month lows on Tuesday as China cut
lending benchmarks, while the Australian dollar fell after latest central
bank meeting minutes showed keeping interest rates unchanged was under
consideration.

China on Tuesday lowered its one-year and five-year loan prime rates (LPR)
by 10 basis points, the first such easing in 10 months as authorities seek
to shore up a slowing economic recovery.

The decision knocked the yuan lower in Asian trading and it last fell 0.2%
in onshore trade to 7.1747 per dollar, not far from last week's nearly
seven-month low of 7.1819.

Similarly, the offshore yuan was more than 0.1% lower at 7.1761 per dollar,
languishing near last week's trough of 7.1916, its lowest since late
November.

"Markets were expecting bigger support and were hoping for a larger LPR
cut," said currency strategist Christopher Wong at OCBC. "The delivery of a
smaller LPR cut came as a signal of lesser support and the disappointment
was felt in softer (yuan)."

Investors continue to be on the lookout for greater government support
measures, as a faltering post-pandemic recovery has kept sentiment fragile.

"The playbook may be slightly different, in a sense that it's not going to
be a big bang stimulus. It's probably going to be more targeted," said
currency strategist Moh Siong Sim at Bank of Singapore.

Elsewhere, the Australian dollar tumbled as much as 0.7% to a session low of
$0.6798 after minutes from the Reserve Bank of Australia's (RBA) latest
policy meeting released on Tuesday showed its decision to hike interest
rates in June was "finely balanced".

"The minutes were interpreted by market participants as dovish," said
currency strategist Carol Kong at Commonwealth Bank of Australia. "As a
result, markets have pared back their expectations for the RBA cash rate, so
that weighed on the Aussie."

The New Zealand dollar fell 0.17% to $0.6188.

RATES OUTLOOK

In other currencies, the yen slumped to a seven-month low of 142.26 per
dollar, extending its decline following the Bank of Japan's (BOJ) decision
on Friday to maintain its ultra-easy monetary policy.

The yen has come under renewed pressure amid rising interest rate
differentials between Japan and other developed markets.

"We believe that Japan's economy is recovering solidly compared to other
major economies and will continue to outperform in the future. But, if
monetary policy fails to reflect this shift of economic fundamentals and the
BOJ keeps its dovish policy, then the yen should depreciate even more," Min
Joo Kang, ING senior economist for South Korea and Japan, said in a client
note.

The euro rose marginally to $1.0923, drawing support from a still-hawkish
European Central Bank after two policymakers on Monday said the bank should
err on the side of further rate hikes as the inflation rate could come in
even higher than it expects.

Sterling edged 0.06% higher to $1.2798, ahead of British inflation data and
the Bank of England's (BoE) interest rate decision later in the week.

Markets are expecting the BoE to deliver a quarter-point rate hike on
Thursday, which would be its 13th consecutive rise as the bank fights
unexpectedly sticky inflation.

"The market has continued to increase pricing expectations of not only a
delivery of potentially more than 25 basis points this week, but (also)
higher terminal rates," said Rodrigo Catril, senior currency strategist at
National Australia Bank.

"To some extent, we think that the pricing has become a little bit too
aggressive in terms of what we think the Bank of England needs to do."

Against a basket of currencies, the U.S. dollar steadied at 102.47.

The Thomson Reuters Trust Principles.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold steady as traders await Powell testimony for rate cues

Gold prices flitted in a tight range on Tuesday, as market participants
maintained a cautious stance and awaited further direction from the Capitol
Hill testimony by U.S. Federal Reserve chair Jerome Powell due this week.

FUNDAMENTALS

* Spot gold held its ground at $1,950.89 per ounce by 0027 GMT after dipping
in holiday-thinned trade on Monday. U.S. gold futures were down 0.4% at
$1,962.60.

* Markets now await Powell's congressional testimonies due on Wednesday and
Thursday for cues on future rates, following a 'hawkish pause' on monetary
policy tightening.

* Gold is considered a hedge against inflation, but interest rate hikes
raise the opportunity cost of holding non-yielding bullion.

* Traders are now pricing in an about 74% chance of Fed rate hike in July,
according to the CME Fedwatch tool.

* China is widely expected to cut key lending benchmarks on Tuesday in the
first such easing in 10 months, a Reuters survey showed, as authorities seek
to shore up a slowing recovery in the world's second-largest economy.

* Meanwhile, consumer confidence in New Zealand improved in the second
quarter but households remain deeply pessimistic about the economic
landscape, a survey showed on Tuesday.

* Additionally, the European Central Bank should raise interest rates again
in July as inflation risks are skewed towards higher outcomes, Slovakia's
central bank chief said on Monday, while the Bank of England is expected to
raise rates by another 25 basis points on Thursday.

* Spot silver was up 0.2% at $23.9945 per ounce, palladium rose 0.3 to
$1,410.36, while platinum fell 0.2% to $973.63.

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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