Bulls n Bears Daily Market Commentary : 09 March 2023

Fri Mar 10 05:21:04 CAT 2023

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Bulls n Bears Daily Market Commentary : 09 March 2023

 <https://www.facebook.com/Hyundaizimbabwe> ZSE commentary

ZSE ends Thursday's session in marginal gains .

The market ended Thursday's session in marginal gains as three of the main
indices closed in the black while, Mid-cap was in the red. The mainstream
All Share Index advanced 0.64% to 29467.69pts while, the ZSE Top Ten Index
rose 0.99% to end at 16990.67pts. The Agriculture Index went up 0.17% to
125.97pts as the Mid Cap Index eased 0.27% to close at 65290.58pts. Leading
the winners of the day was Bridgefort Capital Class B that surged 12.69% to
$29.3000 on a paltry 300 hares. Trailing was Mashonaland Holdings that put
on 11.32% to $10.0000 as agriculture concern Ariston followed thereafter on
a 4.17% lift to $11.4582. Financial services group ZB edged up 3.30% to
$118.8000 as Delta jumped 2.06% to close at a vwap of $531.2108 having
traded an intra-day high of $598.0000. Trading in the negative territory was
Proplastics that dipped 12.05% to $70.3160 followed by bankers First Capital
that shed 2.70% to $18.0005. Retailer OKZIM trimmed 0.81% to $55.5775 as
VFEX bound African Sun declined 0.71% to $92.0000. Ecocash completed the top
five fallers' pack on a 0.07% dip to $65.8657.

Volumes traded plunged 55.80% to 7.05m while, turnover tumbled 55.88% to
$544.40m. Volume leaders of the day were First Capital and OKZIM that
accounted for 45.59% and 27.63% of the aggregate apiece. Anchoring the value
aggregate was Delta, OKZIM and AFDIS that claimed a combined 66.38% of the
outturn. On the VFEX, Padenga succumbed 11.60% to $0.2210 as Axia recoiled
0.86% to $0.1386. Bindura, Innscor and Simbisa retreated 0.50%,0.37 and
0.05% apiece. SeedCO International was the sole gainer on the VFEX as it
improved 3.05% to $0.2700. On the ETF segment, the four ETFs recorded gains
as 128,318 units worth $447,828.95 traded. Datvest MCS, Cass Saddle, Morgan
and Co MCS and OMTT soared 2.25%, 1.86%, 1.67% and 0.33% in that order with
MIZ sailed stable at $1.4000. A total of 1.33m units valued at $60.03m
exchanged in the Tigere REIT to see it close at $45.0028 after a 5.63%
decline.-efesecurities

Global Currencies & Equity Markets

AFRICA-FX- Kenyan and Zambian currencies seen weakening

(Reuters) - The Kenyan and Zambian currencies are expected to weaken against
the dollar in the coming week, while the currencies of Nigeria, Ghana,
Uganda and Tanzania are set to hold steady.

KENYA

Kenya's shilling KES= is expected to weaken, driven by increased demand for
dollars, especially from oil retailing companies.

Commercial banks quoted the shilling at 128.80/129.00 per dollar, compared
with last Thursday's close of 127.30/50.

During Thursday's session, the shilling touched a new all-time low of
128.90/129.10 per dollar, Refinitiv data showed.

"There is a bias towards a weaker currency. Demand is still quite high. Oil
(companies) are the biggest consumers," a trader at one commercial bank
said.

ZAMBIA

Zambia's kwacha ZMW= is likely to continue weakening against the dollar next
week as rising demand for hard currency continues to outweigh supply.

On Thursday, commercial banks quoted the currency of Africa's second-largest
copper producer at 20.4000, down from 20.1400 a week ago.

"The local currency is expected to remain broadly weak going into next
week," one commercial bank trader said.

NIGERIA

Nigeria's naira NGNP= is seen broadly stable on the parallel market after a
court ordered that new banknotes should circulate with old notes till
year-end to ease cash shortages, traders said.

The naira was quoted at 753 to the dollar on the parallel market on
Thursday, compared with 755 at last Thursday's close. It traded within a
range of 460 to 462 on the official market.

"Against the backdrop of continued pent-up naira demand, the currency
appreciated against the dollar. As the court's order takes effect and notes
begin re-circulating, we expect the naira to decline gradually," foreign
exchange trading firm AZA Finance said in a note.

GHANA

Ghana's cedi GHS= is expected to remain steady after a week of gains driven
by improved forex liquidity and a low corporate demand for dollars.

Refinitiv Eikon data showed the cedi trading at 12.0000 to the dollar on
Thursday, compared to 12.6000 at last Thursday's close.

"Cedi posted further gains week-on-week against the dollar, driven by
continued slowdown in corporate USD demand amid sustained supply," said
Chris Nettey, a trader at Stanbic.

He added that the currency would have to hold firm at current levels in the
coming week to confirm a downward trajectory in rates.

UGANDA

The Ugandan shilling UGX= is seen trading in a stable range with demand
remaining broadly subdued as large firms reserve some of their local
currency holdings for mid-month tax obligations, traders said.

At 1007 GMT commercial banks quoted the shilling at 3,705/3,715, unchanged
from last Thursday's close.

"Mid-month taxes are coming so I would anticipate that generally we'll see a
bit of a slump in dollar appetite," said a trader at one commercial bank.

The local unit, he said, will likely swing in the 3,690-3,720 range against
the dollar in the coming week.

TANZANIA

Tanzania's shilling TZS= is expected to hold steady next week as inflows
from exports and the retail market have eased demand for dollars from most
sectors.

Commercial banks quoted the shilling at 2,335/2,345 against the dollar on
Thursday, unchanged from the last week's close.

"The Bank of Tanzania has continued to intervene in the FX market, selling
$124 million into the market during the first half of the 2022/23 financial
year," a trader in one of Tanzania's forex trading firms said.

"Given this central bank support, we expect the shilling to continue trading
around current levels over the coming week," the trader said.

South Africa

Rand extends losses as sharper-than-expected Q4 GDP contraction signals
start of deep recession

The gross domestic product (GDP) read for Q4 2022 was simply a shocker,
based on the expectations of economists who seem to have underestimated the
impact that the surging levels of power cuts have been having on economic
activity.

The case is now open and shut. The economy simply cannot grow if rolling
blackouts are maintained at current levels, and in fact is contracting
before our eyes. And given the extent of the power crisis so far this
quarter, it is safe to say that the South African economy is currently in
the throes of a recession which is defined as two straight quarters of
contracting GDP.

To wit, Statistics South Africa (Stats SA) said on Tuesday that the economy
contracted 1.3% in Q4, against market expectations of a contraction of 0.4%,
according to a median Bloomberg forecast by economists. Indeed, Bloomberg
said that the contraction's size exceeded all of the estimates it gathered
from economists. This also pulled GDP back below pre-pandemic levels. Every
time the economy crosses that milestone - back to pre-pandemic levels,
yahoo! - it gets pushed back into 2019 again.

 <mailto:info at bulls.co.zw> 

Global Markets

Dollar dips as jobless claims rise more than expected

(Reuters) - The dollar dipped on Thursday after data showed U.S. jobless
claims rose more than expected last week, raising hopes that a softening
labor market will reduce the likelihood of the Federal Reserve
reaccelerating the pace of its rate hikes.

Initial claims for state unemployment benefits rose 21,000 to a seasonally
adjusted 211,000 for the week ended March 4. Economists polled by Reuters
had forecast 195,000 claims for the latest week.

It comes before Friday's highly anticipated jobs report for February, which
may determine whether the Fed increases its pace of rate hikes to 50 basis
points at its March 21-22 meeting.

"A lot of traders are breathing a sigh of relief that we're starting to see
some softness in the labor market," said Edward Moya, senior market analyst
at OANDA in New York. "The fear is that if we get a strong payrolls report
tomorrow that that's just going to cement the rising expectations of a half
point rate increase."

The dollar was last down 0.31% against a basket of currencies at 105.28. It
is down from a three-month high of 105.88 on Wednesday. The euro gained
0.31% to $1.0577 and is up from a two-month low of $1.0524 on Wednesday.

Fed Chair Jerome Powell on Wednesday reaffirmed his testimony before
Congress from Tuesday of higher and potentially faster interest rate hikes,
but emphasized that debate was still underway, with a decision hinging on
data to be issued before the March meeting.

Fed funds futures traders are now pricing in a 60% probability that the Fed
will hike rates by 50 basis points, up from around 22% before Powell's
comments on Tuesday.

Friday's data is expected to show employers added 205,000 jobs in February,
according to a Reuters poll of economists, well below the
much-larger-than-expected 517,000 gains in January. Wages are expected to
have increased 0.3% for the month, and 4.7% on an annual basis.
(USNFAR=ECI), (USAVGE=ECI), (USAVHE=ECI)

Consumer price inflation data on Tuesday will also be key to the Fed's
decision. It is expected to show that prices rose 0.4% in February.
(USCPI=ECI)

If the jobs market remains strong and inflation stays high, Treasury yields
could face further increases, which would also boost the greenback.

"The Fed's going to stay data dependent and that's going to keep us
vulnerable to some further pressure in the bond market, which could make the
king dollar trade hang around a little bit longer," said Moya.

The yen gained a day before the Bank of Japan concludes its final meeting
with governor Haruhiko Kuroda.

The Japanese central bank is expected to end its long-term yield control
policy this year, but make no major changes this week, according to a
Reuters poll of economists.

The dollar fell 0.87% against the Japanese currency to 136.216 yen. It
reached a three-month high of 137.90 on Wednesday.

Sterling was one of the best performers on Thursday, rising 0.58% to
$1.1911. It fell to a more than three-month low of $1.18050 on Wednesday.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold shows early signs of recovery after hawkish Fed triggered price tumble

Gold has shown some signs of recovery after its price tumbled earlier this
week following Fed Chair Jerome Powell's hawkish comments to Congress about
the potential need for further interest rate hikes.

The precious metal slipped from $1,856 per ounce on Monday morning to $1,809
per ounce by close of play on Tuesday.

Prices have since recovered to around $1,820 per ounce, dipping under and
over the threshold in the previous day's trading.

This includes a $6 climb from $1.913 per ounce to $1,919 per ounce in this
morning's trading.

Powell's testimonies to the Senate Banking Committee and the House Financial
Services panel have raised expectations of another 50 basis point hike at
its next meeting on 22 March.

The chair of the world's most influential central bank told Congress he is
"prepared to accelerate rate hikes" if the pace of price increases in
America stays high.

His comments rule out hopes that the Fed was drawing its aggressive campaign
to fight inflation to a close.

Rupert Rowling, market analyst at Kinesis Money, argued gold was an "obvious
casualty of this" due to its lack of yield making it less attractive at a
time of rising rates.

Interest rates are already at 4.75-5 per cent while the dollar has proven
itself remarkably robust since the pandemic.

However, he was optimistic about Gold's short term outlook and expected gold
to remain above $1,800 per ounce threshold.

"The fact that the markets are now pricing in these elevated levels should
ensure that gold's punishment when the rate decisions are announced is more
muted," Rowling said.

"Such has been the strength of buying by central banks, particularly China
and Turkey, over the last year or so that the support at these lower levels
remains very strong. so while significant gains are difficult for gold
currently, further large drops are unlikely to be sustained," he added.

But tomorrow's US jobs report could nudge gold prices again.

"Gold once again ran into support around $1,800-$1,810 this week but that
may only prove temporary if we get another hot jobs report tomorrow," Craig
Erlam, senior analyst at Oanda, said.

Fawad Razaqzada, an analyst at StoneX, said: "For gold to make a stronger
recovery, we will have to see a surprise miss on Friday's [Nonfarm payroll].
If that happens, it could support stocks, gold and bonds as traders question
the likelihood of such an aggressive hike."

"On a side note, the market may have gotten ahead of itself as Powell did
not explicitly say that a 50bp is on the cards. So, there's definitely room
for disappointment if it ends up being a mere 25bp hike on March 22. This
therefore makes the upcoming [Nonfarm payroll] and inflation data very
important indeed," he added.-cityam

INVESTORS DIARY 2023

Company

Event

Venue

Date & Time

Good Friday

April 7

Easter Saturday

April 8

Easter Sunday

April 9

Easter Monday

April 10

Independence Day

April 18

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
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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