Bulls n Bears Daily Market Commentary : 07 February 2024

Thu Feb 8 07:37:53 CAT 2024

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Bulls n Bears Daily Market Commentary : 07 February 2024

 <https://www.dulys.co.zw/> 
ZSE commentary

ZSE eked out gains as Government announces plans to introduce a new
structured currency .

The government yesterday announced plans to introduce a new structured
currency in a bid to curb the runaway exchange rates. The move has created
both negative and positive effects in the market as reflected by bids from
buyers who want to dispose excel ZWL, while others have been gripped by
panic selling in a bid to lock the gains achieved in the prior sessions as
asset repricing could kick in. The ZSE primary All Share Index rebounded
1.42% to 559,065.53pts while, the Blue-Chip Index gained 1.67% to
248,833.87pts. The Agriculture Index added 3.23% to 1,572.55pts while, the
Mid Cap Index went up 4.03% to 2,120,082.82pts.  Zimpapers headlined the top
performers of the day on a 26.53% surge to close at $62.0000.  Banking group
CBZ, NMB and TSL surged a similar 15.00% to settle at $8,993.0000,
$2,266.6000 and $2,017.7500 respectively.  Conglomerate ART completed the
winners of the day on a 14.70% uplift to end the day pegged at $119.0000.

On the contrary, telecoms giant Econet led the laggards of the day on a
14.95% drop to $2,527.4815 followed by seed producer Seed Co that slipped
6.64% to $2,799.9781. Proplastics retreated 5.94% to $1,599.0000 while,
Zimre Holdings Limited declined 4.82% to $220.0139. General Beltings capped
the fallers of the day on a 4.72% slid to $150.0000. Activity aggregates
enhanced in the session as volume traded ballooned 701.85% to 7.80m shares
while, value traded grew 122.31% to $5.62b. The top volume drivers of the
day were Zimre Holdings (66.89%), Ecocash Holdings (12.39%) and OkZim
(7.58%). The trio of Delta, Zimre Holdings and Econet contributed a combined
66.48% to the total value traded.   Other top value drivers of the day were
Ecocash (13.06%) and OKZim (9.70%).  In the ETF section, Morgan and Co Multi
Sector and OMTT ETFs dropped 0.02% and 0.08% to $530.5000 and $99.0538
respectively. Cass saddle ETF grew 3.31% to $7.8000 while, Datvest ETF
advanced 12.12% to $19.2961. MIZ ETF inched up 2.67% to close at $14.3734.
-efesecurities

Global Currencies & Equity Markets

South Africa

South African rand weakens ahead of president's address

(Reuters) - South Africa's rand weakened on Wednesday as local investors
turned their attention to President Cyril Ramaphosa's address to the nation.

At 1512 GMT, the rand traded at 18.9150 versus the dollar , 0.4% weaker than
its previous close.

The dollar was last down 0.08% against a basket of other major currencies.

Ramaphosa makes his State of the Nation Address (SONA) on Thursday and
investors will be looking to see what solutions are proposed to fix South
Africa's power crisis and rail and port problems, which have strangled
growth in Africa's most industrialised economy.

-

On the Johannesburg Stock Exchange, the blue-chip Top-40 index (.JTOPI),
opens new tab closed 0.42% lower.

South Africa's benchmark 2030 government bond slipped, with the yield up 8
basis points to 9.885%.

Nigeria

Naira depreciates to N1,500/$ at parallel market

The Nigerian naira, on Wednesday, depreciated to N1,500 at the parallel
section of the market.

The rate is a 3.45 percent decrease from the N1,450 per dollar recorded on
Monday.

Currency traders in Lagos, also known as Bureau De Change operators (BDCs),
quoted the buying rate of the greenback at N1,490 and the selling price at
N1,500 - leaving a profit margin of N10.

At the official window, the local currency appreciated by 1.05 percent to
N1,418/$ on Wednesday - from N1,433/$ on Tuesday.

According to FMDQ Exchange, a platform that oversees official foreign
exchange (FX) trading in Nigeria, the naira traded as high as N1,510 and as
low as N896.28 - with a daily turnover of $203.93 million.

Meanwhile, on February 1, 2024, the Central Bank of Nigeria (CBN), continued
its foreign exchange market reforms by removing the limit on the FX rate
quoted by international money transfer operators (IMTOs).

"For the avoidance of doubt, by this circular, the cap on allowable limit of
-2.5% to +2.5% around the previous day's closing rate of the Nigerian
Foreign Exchange Market is hereby removed," the apex bank said.

CBN instructed the money transfer operators to quote exchange rates based on
the prevailing market rates at the FX market.

 <mailto:info at bulls.co.zw> 

Global Markets

Dollar slips as market awaits new data for direction

(Reuters) - The dollar slid further on Wednesday as it consolidated a bounce
in recent days from surprisingly strong U.S. economic data and pushback from
Federal Reserve officials on market expectations of imminent interest rate
cuts.

The dollar eased from a nearly three-month high against the euro on Tuesday
even as market bets on a rate cut by the Fed in March have risen four
percentage points the past two days.

-

Treasury yields, often a factor in the dollar's strength when they draw
foreign investment, also rebounded.

"The dollar's rally is a bit overcooked, sort of in line with how I'm
viewing U.S. yields," said Brad Bechtel, global head of FX at Jefferies in
New York.

"We've gone pretty far, pretty fast and we're kind of bouncing up against
some resistance levels."

The dollar index , a measure of the U.S. currency against six major peers,
including the euro, rose above its 100-day moving average on Monday and
Tuesday for the first time since late November.

-

The euro rose 0.18% to $1.0775 per dollar, after retreating on Tuesday when
it touched $1.0722, its lowest level since Nov. 14.

The dollar index slipped 0.11% to 104.01, just below its 100-day moving
average of 104.20.

"It's really data that's going to drive the next move. In the meantime,
we'll probably consolidate a little bit, pull back a little bit in the
dollar, maybe rally a little bit in the euro and sterling," Bechtel said.

-

The next major scheduled data release is the Consumer Price Index for
January on Feb. 13.

Analysts pointed to technical factors for the dollar's pullback, following a
two-day rally of as much as 1.4% against the euro. Unexpectedly strong U.S.
jobs data, as well as more hawkish rhetoric from Federal Reserve Chair
Jerome Powell, pummeled bets for a rate cut as soon as March.

U.S. Treasury yields gained some respite on Wednesday after falling from
this week's highs on solid demand at a sale of new three-year notes,
removing some support for the dollar.

"Despite the ruling out of March rate cut hopes, the market is still showing
some reluctance to go all in on the long U.S. dollar trade given the high
conviction around rate cuts later in the year," said Jane Foley, head of FX
strategy at Rabobank.

Traders are currently pricing in an 18.5% chance of a rate cut in March, up
from 14.5% on Monday, the CME Group's FedWatch Tool shows. At the start of
the year bets saw a 68.1% chance.

A sharper than expected fall in industrial production in the euro zone's
largest economy had no impact on the euro as "Germany's industrial malaise
is now a well-known story", said Chris Turner, global head of Markets at
ING.

The dollar edged 0.13% higher against the yen to 148.125 , after sliding
0.49% on Tuesday. The currency pair tends to be extremely sensitive to moves
in Treasury yields.

"Financial markets are in the process of recalibrating their expectations
for Federal Reserve policy," said James Kniveton, senior corporate forex
dealer at Convera.

"If positive economic data, particularly on inflation, persists in the U.S.,
the tide could turn towards earlier rate cuts, potentially weakening the
greenback further."

Sterling rose 0.24% against the dollar to $1.2629 after higher house prices
in Britain supported bets that the Bank of England was not likely to cut
rates any time soon. 

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold jumps Rs170; silver plunges Rs300

New Delhi: Gold prices jumped Rs170 to Rs63,370 per 10 grams in the national
capital on Wednesday amid gains in precious metal's prices globally,
according to HDFC Securities. The yellow metal had closed at Rs63,200 per 10
grams in the previous trade. 

However, silver plunged Rs300 to Rs74,600 per kilogram, while it had ended
at Rs74,900 per kg in the previous close. "Spot gold prices (24 carats) in
the Delhi markets are trading at Rs63,370 per 10 grams, up by Rs170, taking
bullish cues from the overseas markets," said Saumil Gandhi, senior analyst
(commodities) at HDFC Securities. In the international markets, spot gold at
Comex was trading at $2,033 per ounce. 

However, silver was trading marginally lower at $22.24 per ounce. Amid a
pullback in the US Treasury yields and dollar, gold prices rose on
Wednesday, Gandhi added.

INVESTORS DIARY 2024

Company

Event

Venue

Date & Time

Counters trading under cautionary

CBZH

GetBucks

EcoCash

Padenga

Econet

RTG

Fidelity

TSL

FMHL

ZBFH

Invest Wisely!

Bulls n Bears 

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