Bulls n Bears Daily Market Commentary : 10 July 2024

Thu Jul 11 08:20:06 CAT 2024

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Bulls n Bears Daily Market Commentary : 10 July 2024

ZSE commentary

Northwards trek continues ...

The northward trend continued on the ZSE market to see the primary All Share
Index rising by a further 6.07% to 166.0lpts while, the Blue-Chip Index
gained 6.88% to 178.31pts. The Agriculture Index added 3.83% to 127.20pts
while,  the  Mid Cap Index went up 2.51% to 135.69pts. Banking group ZB
Financial Holdings led the top performers of the day on a 15.00% jump to
$7.3625. The duo of TSL and tea producer Tanganda  surged  a  similar
14.99%  to  close  at  $1.7250  and $3.1335 respectively. Beverages giant
Delta stepped up 12.68% to $12.6272 while, Mashonaland Holdings completed
the winners of the day on a 12.50% uplift to end the day pegged at $0.2700.
In contrast, FMP slipped 5.26% to settle at $0.3600 while, brick
manufacturer Willdale trimmed 1.16% to end the day pegged at $0.0395. The
market closed with a positive breadth of thirteen after fifteen counters
recorded gains against two that faltered .

Activity aggregates declined in the session as volumes traded fell 88.59% to
.44m shares while, values dropped 80.94% to

$1.95m. Top volume drivers of the day were Ecocash {24.65%), Star Africa
(23.88%), OKZIM (19.18%} and ART (13.44%). Top

value drivers were CBZ (41.24%), Delta (19.89%}  and Econet (19.38%). A
total of 10,100 units worth $118.00 exchanged hands in the ETF section. The
OMTI ETF charged 12.50% to end the day pegged at $0.1800 on 100 units. The
MIZ ETF was stable at $0.0100 on 10,000 units. No trades were recorded in
the REIT section.

VFEX extend losses...

The VFEX  market extended losses as the All-Share  Index dropped 0.70% to
103.99pts. Axia led the laggards of the day

First Capital that trimmed 10.96% to $0.0406. Padenga eased 0.19% to close
at $0.1601 while, seed producer SeedCo International completed the list on a
similar 0.19% slide to end the day pegged at $0.2695. Partially mitigating
today's losses was fast foods group Simbisa that charged 2.94% to $0.3500
while, lnnscor rose 1.98% to end the day pegged at $0.4625.

Activity aggregates enhanced in  the session as volumes ballooned 6,085.31%
to $883,201 while, turnover grew 1,348.70% to $57,370.34. Axia anchored
today's activity aggregates after contributing 96.26% to the total volume
traded and 95.88% to turnover.efesecurities

 <mailto:info at bulls.co.zw> 

Global Currencies & Equity 

South Africa

South African rand gains on weaker dollar, focus on Fed rate path

(Reuters) - The South African rand gained in early trade on Wednesday
against a weaker dollar, as focus remains on the future interest rate path
of the world's biggest economy.

At 0725 GMT, the rand traded at 18.0550 against the dollar, around 0.5%
stronger than its previous close. The dollar last traded around 0.06% weaker
against a basket of global currencies.

"Fed Chair Jerome Powell commented last night. that the Fed is not
comfortable cutting rates right now," said Andre Cilliers, currency
strategist at TreasuryONE.

But U.S. inflation has been improving in recent months and Powell said that
"more good data would strengthen" the case for central bank interest rate
cuts.

Markets will focus on key U.S. inflation data on Thursday that could give
more hints on the Fed's future interest rate path.

The rand often takes cues from global drivers like U.S. monetary policy in
the absence of major local data points.

On the Johannesburg Stock Exchange, the blue-chip Top-40 index traded around
0.1% weaker in early trade.

South Africa's benchmark 2030 government bond was slightly stronger in early
deals, as the yield weakened 1.5 basis points to 9.79%.-cnbc

Nigeria

Naira Plummets in Official Forex Market

The Naira has continued to be in free fall against the Dollar in the foreign
exchange market regardless of the increase in FX transaction turnover.

Data from FMDQ showed that the Naira dropped to N1532.58 against the Dollar
on Tuesday from N1523.85 traded on Monday, representing an N8.73
depreciation against the Dollar compared to the N1523.85 traded on Monday.

Naira Plummets in Official Forex Market

The depreciation comes regardless of the surge in foreign currency
transaction turnover, which was $188.19 million on Tuesday from $133.46
million on Monday.

The Naira also dipped at the parallel foreign exchange market to N1540 on
Tuesday from N1530.

The Nigerian currency lost N22.91 and N15 at both the official and parallel
foreign exchange markets from last Friday to Tuesday despite the increase in
Nigeria's external reserves to $34.66 billion as of June 4, 2024.

MA

 <mailto:info at bulls.co.zw> 

Global Markets

Dollar dips as Powell remains cautious before CPI data

(Reuters) - The dollar dipped on Wednesday after Federal Reserve Chair
Jerome Powell indicated that the U.S. central bank is getting closer to
cutting interest rates but wants to see further declines in inflation.

It comes before consumer price index (CPI) data on Thursday is expected to
show that headline prices eased on an annual basis in June.

Powell is "still interested in seeing some more trends and I think we're
going to have to see with CPI," said Paula Comings, head of foreign exchange
sales at U.S. Bank in New York. "He's continuing to hedge his bets and be
very fair and balanced."

Economists polled by Reuters expected Thursday's report to show that
headline prices rose 0.1% on the month, while core prices gained 0.2%. That
would put annual gains at 3.1% and 3.4%, respectively. (USCPI=ECI), opens
new tab, (USCPF=ECI), opens new tab

Powell said on Wednesday he was not ready to conclude that inflation is
moving sustainably down to 2% though he has "some confidence of that."

His comments on his second day of testimony before Congress largely mirrored
those made on Tuesday, when he also acknowledged the cooling labor market
and noted that "we now face two-sided risks" in the economy.

"Powell took a relatively cautious approach," said Karl Schamotta, chief
market strategist at Corpay in Toronto. "But there were enough dovish hints
within his narrative to help risk appetite improve in markets."

"The idea that the labor market is no longer generating the inflation
pressure that the U.S. economy was struggling with, and that the Fed was
trying to counteract, is helping to reduce the likelihood of further rate
hikes and also put a September rate cut more firmly on the table," Schamotta
said.

Traders now have around 73% odds for a rate cut by September, with a second
cut also seen likely by December, according to the CME Group's FedWatch
Tool.

The dollar is expected to weaken when the Fed begins cutting rates but
traders are in no rush to fully price in such a move until it appears more
certain, especially as U.S. interest rates remain above peers.

"It just goes back to the divergence," said Comings, noting that any dollar
weakness will also depend on the pace and level of rate cuts, or hikes, by
other central banks.

The dollar index , which measures the U.S. currency against six others
including the euro and yen, was last down 0.07% at 105.05.

The euro gained 0.1% to $1.0823 as investors came to terms with a hung
parliament in France.

The unexpected outcome of the snap election, in which the left benefited
from a surprise surge but no group won an absolute majority, has plunged
France into uncertainty, with no obvious path to a stable government.

The dollar strengthened 0.29% to 161.77 Japanese yen , getting closer to a
38-year high of 161.96 reached last week.

The Japanese currency has suffered from the wide differential between U.S.
and Japanese interest rates.

Many Japanese private banks who met with the Bank of Japan on Tuesday called
for the central bank to halve its monthly bond purchases by around 2026, two
officials with direct knowledge of the deliberations told Reuters.

The findings will be taken into account when the BOJ finalizes its taper
plan at its policy meeting on July 30-31.

Sterling hit a four-week high after Bank of England Chief Economist Huw Pill
said on Wednesday the central bank was moving closer to cutting interest
rates but services price inflation and wage growth remained uncomfortably
strong.

It was last up 0.48% at $1.2842 and earlier reached $1.2847, the highest
since June 12.

Meanwhile, the kiwi dropped after the Reserve Bank of New Zealand opened the
door to possible rate cuts should inflation slow as expected.

The RBNZ, which held rates steady as widely expected, expressed confidence
that inflation would return to its target band this year, spurring bets for
early policy easing.

At the previous meeting in May, policymakers had flagged the potential for
an additional rate hike.

The New Zealand currency was last down 0.75% versus the greenback at
$0.6077.

In cryptocurrencies, bitcoin fell 0.57% to $57,584.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Gold Holds Ground as Traders Brace for US Inflation Data

Gold prices held steady on Thursday, with investors awaiting US inflation
data due later in the day for more insights on the Federal Reserve's
interest rate path.

Spot gold was nearly unchanged at $2,372.99 per ounce, as of 0042 GMT. US
gold futures were flat at $2,378.40.

Earlier, Fed Chair Jerome Powell said on Wednesday that the US central bank
would make interest rate decisions "when and as" they were needed. On
Tuesday, he told House members that "more good data" would build the case
for a rate cut.

Non-yielding gold's appeal tends to shine in a low interest rate
environment.

Markets currently see around 73% odds for a rate cut by September, with a
second reduction also seen likely by December, according to the CME Group's
FedWatch Tool, Reuters reported.

Traders are waiting for the June Consumer Price Index (CPI) report due at
1230 GMT and the Producer Price Index (PPI) report due on Friday.

Also, spot silver rose 0.2% to $30.87 per ounce, platinum ticked up 0.5% to
$994.10 and palladium gained 0.4% to $989.93.

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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