Bulls n Bears Daily Market Commentary : 30 March 2023

Fri Mar 31 01:09:10 CAT 2023

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Bulls n Bears Daily Market Commentary : 30 March 2023

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

ZSE commentary

ZSE closes in the black as heavies trade mixed.

The market closed pointing northwards as two of the main indices in our
review gained against two that faltered. The primary All-Share Index added a
marginal 0.64% to end at 37962.05pts while, the Top Ten Index put on 0.99%
to 22,543.87pts. The Mid Cap and the Agriculture Indices slipped 0.55% and
0.02% to close at 75726.76pts and 144.06pts apiece.

Cigarette manufacturer BAT was the best performer of the day on a 14.07%
surge to $3,274.3541 as Mashonaland trailed on a 9.09% jump to $15.0000.
Beverages group Delta advanced 3.52% to $816.5193 while, construction group
Masimba extended 3.27% to $142.0000. Meikles capped the top five winners of
the day on a 3.17% uplift to $325.0000. Trading in the negative territory
was tea company Tanganda that dropped 8.70% to settle at $315.0000.
Following was Econet that dipped 3.65% to $247.1278 having traded an
intraday low of $246.0000. Hotelier African Sun tumbled 2.81% to $82.9944 as
fintech group Ecocash slipped 2.14% to $70.0035. Dairiboard completed the
top five shakers of the day on a 2.00% loss to $98.0000. Volume of shares
traded plunged 15.13% to 2.30m while, turnover nosedived 12.48% to $417.99m.
Volume leaders  f the day were Star Africa and Econet that contributed
56.92% and 19.95% to the aggregate respectively. Delta, Econet and BAT
claimed a combined 94.27% of the value outturn. On the VFEX, two fallers of
the day were Innscor and Axia that declined 10.92% and 2.04% in that order.
Simbisa rose 5.70% to USD$0.4228 while, SeedCo International improved
USD$0.2615. Padenga was stable at USD$0.1810 on 977,480 shares which
represents 90.38% of the total volume traded on the VFEX. The Old Mutual ETF
shed 8.19% to $10.0075 while, MIZ tripped 4.00% to $1.9200. Morgan and Co
MCS grew 8.26% to trade at $30.9500. Cumulatively, 137,802 units worth
$1.25m exchanged hands on the ETF. The Tigere REIT was up 0.02% at $50.0472
on 36,573 units.

efesecurities

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

Global Currencies & Equity Markets

South Africa

South African rand firms after central bank rate surprise

(Reuters) - South Africa's rand firmed against the dollar on Thursday after
the central bank raised its main interest rate by a higher than forecast 50
basis points to 7.75%.

At 1521 GMT, the rand , which flirted with an almost 2 percentage point jump
right after the surprise decision, was trading at 17.8600 against the
dollar, up 1.45% from its previous close.

It breached the 18 rand per dollar barrier for the first time in over six
weeks.

A majority of economists polled by Reuters had expected the South African
Reserve Bank to announce a 25 basis point increase, but central bank
governor Lesetja Kganyago said inflation expectation was still on the
upside.

"Despite some easing of producer price and food inflation, global price
levels remain elevated," he told a media conference.

Statistics South Africa data showed last week that February inflation rose
to 7.0% year on year from 6.9% in January, remaining above the bank's target
of between 3% and 6%.

With interest rates now well above the rate of inflation, it means investors
are earning a higher rate on their investment than the rate at which prices
are going up, generally considered a positive trend.

But analysts were not convinced that the local currency would reflect that
sentiment for long.

"The rand is a short-term beneficiary of the surprise decision to hike rates
more than was anticipated," said Shaun Murison, senior market analyst at IG.

The longer trend of the so-called riskier currency is towards weakening, he
added.

Shares on the local bourse continued their upward trajectory for the fourth
consecutive day with the blue-chip Top 40 index (.JTOPI) closing 0.32%
higher at 71,089 points while the benchmark all-share index (.JALSH) ended
up by 0.29% at 76.705 points.

The blue-chip index has gained almost 3.5% in market value this week,
primarily driven by an improvement in bank (.JBANK) and mining (.JRESI)
stocks.

The government's benchmark 2030 bond was stronger, with the yield down 8.5
basis points to 9.900%.

Nigeria

Naira gains as external reserves rise by 2.9%

Naira on Wednesday gained marginally against the dollar at the official
market following an accretion in external reserves.

Nigeria's external reserves increased by 2.9 percent in one day to $36.67
billion as of March 28, 2023 compared to $35.64 billion recorded on March
27, 2023.

The accretion of external reserves was attributed to a reported $1 billion
inflow from oil sales and exports.

Consequently, naira appreciated by 0.11 percent as the dollar was quoted at
N461.24 on Wednesday as against the last close of N461.75 on Tuesday at the
Investors and Exporters (I&E) forex window, data from the FMDQ indicated.

Most currency dealers who participated at the foreign exchange market
auction on Wednesday maintained bids between N459.50 (low) and N462.13
(high) per dollar.

At the parallel market, also known as black market, naira steadied at N745
per dollar on Wednesday.

"The currency will continue to face pressure from high import costs and
demand for foreign currency for services but the CBN will continue to
intervene in the FX market to limit the pace of depreciation," analysts at
the FSDH research said in a new report.

The possibility for crucial exchange rate reform in the first quarter of
2023 (H12023) is limited and such reform can only happen in the second half
of 2023 on the insistence of a new President. Currently at US$36 billion,
external reserves which can finance about 6-7 of imports of goods and
services will also face pressure in 2023.

According to the report so far in 2023, there has been pressure on external
reserves, which declined from US$37.1 billion in January 2023 to US$36.1
billion on March 15, 2023.

Interventions in the FX markets, as well as limited foreign exchange inflows
are key factors that exert pressure on the reserves.

"We note, however, that rising oil production in the last few months (if
sustained) raises the prospect of reserves accretion in the second half of
2023 (2023H2), the analysts said.

Scarcity of foreign currency in the official market coupled with a high
exchange rate which has hovered N750/US$ in the parallel market continue to
drive high input costs/imported inflation.

 <mailto:info at bulls.co.zw> 

Global Markets

Dollar weakens as inflation data lifts euro

(Reuters) - The U.S. dollar fell to a 1-week low against the euro on
Thursday as German inflation data helped lift the common currency and as
concerns over the banking sector receded.

Inflation eased significantly in Germany in March on the back of lower
energy prices but was above forecasts, adding pressure on the European
Central Bank to further tighten its monetary policy.

Separately, data showed that Spain's consumer prices rose 3.3% year-on-year
in March, the slowest pace since the 12-month period through August 2021 and
less than expected by analysts.

Register for free to Reuters and know the full story

The European Central Bank, which has made it clear future rate hikes will
depend on economic data, has increased its key deposit rate by 350 basis
points to 3% since July as it seeks to tame surging inflation.

"There is a divergence developing between the ECB and the Fed that is going
to weigh on the dollar," Bipan Rai, North America head of FX strategy at
CIBC Capital Markets in Toronto, said.

"(European inflation data) suggests there is more work for the ECB to do and
that could close the policy rate gap between the ECB and the Fed going
forward," he said.

Last week, the Federal Reserve's Federal Open Market Committee raised
interest rates by 25 basis points, as expected, but took a cautious stance
on the outlook because of the banking sector turmoil.

"We believe the main pillars of U.S. dollar strength last year - aggressive
tightening by the Federal Reserve and a resilient U.S. economy - are
unlikely to support the currency going forward," Mark Haefele, chief
investment officer at UBS Global Wealth Management, said in a note on
Thursday.

Haefele recommended increasing exposure to select G10 currencies, including
the Australian dollar, the Japanese yen and the Swiss franc.

On Thursday, the euro was 0.55 % higher at 1.09035 , the highest since March
23. For the year, the euro was up nearly 2% after having slumped 5.7% in
2022.

"The euro was hit by a perfect storm of shocks most of last year, but things
have turned considerably more positive now," strategists at BofA Global
Research said in a note.

"However, we warn that the market has once again run ahead of itself,
pricing early Fed cuts, with re-pricing likely to weigh on EURUSD in the
short term," the strategists wrote.

Data on Thursday showed the number of Americans filing new claims for
unemployment benefits rose moderately last week, showing no signs yet that
tightening credit conditions were having a material impact on the U.S. labor
market, which remains tight.

The dollar index , which measures the currency against six major peers, was
0.468 % lower at 102.16 .

The pound rose 0.58 % against the dollar on Thursday, putting it on pace for
a nearly 3% gain for March, its strongest monthly performance since
November, as headline inflation in Britain showed no signs of slowing down.

In cryptocurrencies, bitcoin was about 1.6 % lower on the day at $ 27,913 ,
after rising to a near 1-week high of $29,170 earlier in the session. The
digital currency came under pressure recently as investors worried over
cryptocurrency exchange Binance and Chief Executive Changpeng Zhou being
sued by the Commodity Futures Trading Commission(CFTC) over regulatory
violations.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold jumps on weaker dollar, with eyes on inflation data

(Reuters) - Gold prices gained nearly 1% on Thursday as a weaker dollar and
lower bond yields drove demand for the precious metal, while investors kept
their eyes peeled for U.S. inflation data to gauge the Federal Reserve's
next move.

Spot gold was up 0.9% at $1,980.83 per ounce by 2:53 p.m. EDT (18:53 GMT),
having touched its highest since March 24 at $1,984.19 earlier. U.S. gold
futures settled up 0.7% at $1,997.70.

The dollar index dipped 0.5%, making gold more attractive for overseas
buyers, while benchmark 10-year Treasury yields eased.

"Much of this rally continues to be a short covering rally," said Bart
Melek, head of commodity strategies at TD Securities. "The catalyst here is
the continued expectations that rates in the U.S. will top out."

Softer dollar lifts gold prices

Data showed U.S. gross domestic product rose 2.6% in the fourth quarter. The
Fed's favored inflation gauge, core personal consumption expenditures (PCE),
is due on Friday.

Investors will be scanning the data for clues about the path of the U.S.
central bank's monetary policy. According to the CME FedWatch tool, markets
are pricing in a roughly 50-50 chance of the Fed maintaining rates at
current levels at its May meeting.

"Anything below expectations on the core (PCE) would imply that there is
less need or requirement for tight monetary policy from the Federal
Reserve," Melek said.

Federal Reserve Bank of Boston leader Susan Collins said it seemed likely
there would be only one more rate hike this year, while Richmond Fed
President Thomas Barkin said inflation remains too high and may take longer
than expected to decline.

"We expect the gold price to fall to around $1,900 per troy ounce -
previously $1,800 per troy ounce - in the coming months," Commerzbank wrote
in a note.

Spot silver rose 1.8% to $23.76 per ounce, platinum added 2% to $986.59 and
palladium gained nearly 2% to $1,467.87.

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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