Bulls n Bears Daily Market Commentary : 31 May 2023

Wed May 31 22:20:06 CAT 2023

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Bulls n Bears Daily Market Commentary : 31 May 2023

ZSE commentary

ZSE ends month in black

The ZSE recorded gains in the month-end session as the primary All Share
Index rose 0.93% to 105154.12pts while, the Blue-Chip Index improved 0.53%
to 64082.88pts. The Agriculture Index firmed up 3.95% to 391.09pts as the
Mid Cap Index gained 2.34% to 194823.54pts. Duo of TSL Limited and ZB
Financial Holdings headlined the gainers of the day as they gained 15.00% to
close at $345.0000 and $277.5500 respectively. Bankers CBZ Holdings advanced
14.99% to $804.5000 while, spirits and wines manufacturer Afdis climbed
14.95% to settle at $1115.0000. Seed producers, Seed Co completed the top
five winners pack of the day on a 14.79% surge to settle at $970.0000.
Cigarette manufacturer, BAT led the laggards of the day as it slumped 13.13%
to $5400.0000, followed by Edgars that dropped 13.04% to close at $50.0019.

Zimplow was 10.35% weaker to settle at $75.0108 while, fintech group Ecocash
Holdings retreated 0.14% to $138.0048. Ariston Holdings capped the top five
fallers list of the day on a 0.05% dip to end the day pegged at $17.9915.
The market closed on a positive breadth of thirteen after nineteen counters
registered gains against six that faltered. Activity aggregates were
depressed in the session as volumes plummeted 83.21% to see 1.63mn
sharestrade while, turnover succumbed 69.07% to $878.3mn. Edgars highlighted
today’s volume as it contributed 75.46% of the aggregate while, Zimplow was
the other notable volume contributor claiming 13.86%. The top value drivers
of the day were BAT (27.35%), Delta (26.92%) and Edgars (25.31). A total of
69,431 units worth $590,968 exchanged hands on the ETF market. Cass Saddle

jumped 11.12% to $3.45000 while, the Datvest MCS soared 13.80% to $5.6977.
OMTT ETF edged up 7.28% to settle at $24.5219. Tigere REIT inched up 14.76%
on 3,200 units to close the month at $118.5163.. efesecurities

 <mailto:info at bulls.co.zw> 

Global Currencies & Equity Markets

South Africa

South Africa's rand hovers near record low, stocks slide

(Reuters) - South Africa's rand retreated on Wednesday, hovering near a
record low hit in the previous session, as weak manufacturing data for China
hit commodity currencies and the dollar rose on weakening European
inflation.

The rand has in May lost more than 7% against the dollar, as investor
sentiment soured over factors including a heightened power crisis and U.S.
allegations, denied by South Africa, that it supplied weapons to Russia last
year.

At 1601 GMT, the rand traded at 19.7800 against the dollar , about 0.5%
weaker than its previous close, after earlier falling as low as 19.8500 to
the dollar.

The rand touched an all-time low of 19.8600 to the dollar on Tuesday.

The dollar was last trading up around 0.5% against a basket of global
currencies, near a two-month high after data showed European inflation is
cooling quicker than expected.

Data showing China's manufacturing sector had not rebounded, as some
investors wanted, contributed to Wednesday's rand weakness, said Casparus
Treurnicht, a portfolio manager at Gryphon Asset Management.

China is South Africa's biggest trading partner.

Shares on the Johannesburg Stock Exchange also slid.

The blue-chip Top-40 index (.JTOPI) closed down 1.30%, while the broader
all-share index (.JALSH) ended the day 1.15% lower.

Weakness came largely from the industrials sector (.JINDI), which closed
almost 3% lower.

South Africa's benchmark 2030 government bond was marginally stronger, with
the yield down 1.5 basis points at 11.300%.

- The Thomson Reuters Trust Principles.

Nigeria

Naira appreciates marginally, exchanges N464.50 to dollar

Indeed, Naira devaluation is probably the most potent weapon against the
prosperity of Nigerians. Nigeria’s migration from a potential industrial
power house with bustling social affluence, to a subdued and stumbling
economy clearly began with the adoption of IMF’s Structural Adjustment
Programme during Babangida’s regime: the chorus from International Agencies,
at that time, was also that falling oil prices with an unserviced debt
burden and the consequent restriction of trade credit to Nigeria, were the
products of an allegedly overvalued Naira exchange rate.

The Naira appreciated against the dollar on Tuesday, exchanging for N464.50
at the Investors’ and Exporters’ window compared with the N464.51 to the
dollar at the close of business on May 26.

The open indicative rate closed at N464.10 to the dollar on Tuesday.

An exchange rate of N467 to the dollar was the highest rate recorded within
Tuesday’s trading before it settled at N464.50.

The naira sold for as low as 460 to the dollar within the days trading.

 <mailto:info at bulls.co.zw> 

Global Markets

Dollar hits highest since mid-March on cooling European inflation

The U.S. dollar rose strongly on Wednesday to a more than two-month high
after data showed European inflation is cooling quicker than expected and
China’s recovery is sputtering.

The euro

fell to $1.066 earlier in the session, the lowest since March 20. It was
last down 0.56% to $1.0673.

That helped the dollar index

, which measures the greenback against six major peers, climb to 104.63, its
highest since March 16. It was last up 0.14% at 104.31.

Data on Wednesday showed inflation in France and some of Germany’s biggest
states is cooling. Analysts said the figures reduced the pressure on the
European Central Bank (ECB) to keep raising interest rates, diminishing the
euro’s attractiveness relative to the dollar.

“It makes an ECB rate increase less likely with the weaker-than-expected
inflation data in France, so definitely helps weaken the euro,” said Chris
Gaffney, president of world markets at TIAA Bank.

Inflation in France cooled in May to its lowest level in a year as energy
and food price increases moderated. Euro zone-wide inflation data is due out
tomorrow.

“European inflation is rolling back now and you’re taking back some of the
previously anticipated hikes from the ECB,” said Carl Hammer, chief
strategist at European bank SEB.

Hammer also said the probable resolution of the U.S. debt ceiling standoff
was supporting U.S. stocks and likely helping the dollar.

Weak economic data out of China also boosted the U.S. currency, analysts
said. A survey released on Wednesday showed that China’s factory activity
shrank faster than expected in May, in the latest sign that the country’s
recovery from COVID-19 lockdowns is faltering.

China’s yuan fell to its lowest since November, and was last down versus the
greenback at 7.1109 per dollar.

“We’re seeing dollar strength after Chinese data came in weaker than
expected. That was the main mover overnight,” said Gaffney. “It gives
investors a little something to worry about, if you will, about the global
recovery and possibility that we’ll see the global economy slip into a
recession.”

In a busy day in currency markets, the greenback was last down 0.37% versus
the Japanese yen

at 139.27 per dollar.

The dollar rose to a six-month peak against the yen of 140.93 on Tuesday but
then fell sharply after Japan’s top currency diplomat said officials “will
closely watch currency market moves and respond appropriately as needed”.

Sterling  was last trading at $1.243, up 0.14% on the day.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold stocks sharply higher as oil price slide continues

Gold stocks got a boost Wednesday on what could be investor optimism that a
four-week low in oil prices will have a positive impact on the margins of
gold mining companies.

West Texas Intermediate (WTI) crude oil slipped nearly 2% from Tuesday’s
closing price to US$68.14 per barrel currently.

Weakness in the crude oil markets comes as OPEC is set to meet on June 4 to
discuss its own plans for production.

The gold price, meanwhile, continues to hover around the US$2000 per ounce
level, likely supported by safe haven demand as uncertainty surrounding the
upcoming debt ceiling vote by the US House of Representatives continues.  

Falling US Treasury yields this week are also seen as aiding gold and silver
stocks.

The VanEck Junior Gold Miners ETF (GDXJ), considered the benchmark for the
performance of junior gold mining stocks, has slid about 5% over the past
month, which might have prompted some speculative buying today as the
overall outlook for the gold mining sector remains positive.

Big name gold producers were having a good day: Barrick Gold Corp. (TSX:ABX,
NYSE:GOLD) had gained around 0.7%, while Newmont was also in the green at
0.3% higher and Kinross Gold and Agnico Eagle 1.5% and 0.9% higher,
respectively.

But it was the mid-tier gold producers who were having a particularly strong
day: Endeavour Mining PLC (LSE:EDV, TSX:EDV, OTCQX:EDVMF) was up about 6%,
New Gold around 4% and McEwen Mining also about 4% higher. Centerra Gold was
up almost 10%, albeit on news that its Öksüt Mine had gained environmental
approval from the Turkish government.

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
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