Bulls n Bears Daily Market Commentary : 06 March 2024

Thu Mar 7 08:04:00 CAT 2024

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Bulls n Bears Daily Market Commentary : 06 March 2024

 <mailto:sales at dulys.co.zw?subject=Request%20Quote> 
ZSE commentary

ZSE retreats further...

The ZSE market continued to wane in the mid-week session to see the All
share Index retreating 2.05% and closed at 508,171.16pts while, the Top
Index shed 2.54% to 225,747.61.The Agriculture Index fell 1.79% to close at
1.355.61pts while, the Mid Cap  Index faltered 0.37% to close at
2,097,699.97pts. Telecommunications giant Econet led the stragglers of the
day on a 14.65% drop to $1,653.9313, having traded an intra-day low of
$1,650.0000, followed by ZB Financial Holdings that tumbled 9.22% to close
at $1,900.000. Pan African Seed Company SeedCo Limited declined 5.56% to
$2,200.0021 while, Nampak Zimbabwe Limited fell by 4.07% to close at
$470.0000. Ecocash Holdings completed the top five fallers list on a 3.55%
slid to end the day locked in at $622.0833 on selling pressure. Zimre
Holdings Limited capped the gainers of the day on a 11.81% jump to $265.0000
preceded by Zimbabwe Newspaper that added 1.44% to $101.4433. The market
closed with negative breadth of four as eight counters registered gains
against four that faltered.

Activity aggregates improved in the session as volume traded increased by
507.60% to 3.92m shares while, value traded grew by 307.87% to $7.31b.
Econet most sought after stock of the day, driving both the volumes and
values after contributing 66.66% and 59.11% respectively. Other volume
drivers of the day were OK (16.60%), Seed co (8.28%) and Delta (5.65%).  The
triad of Delta, SeedCo and OKZim claimed a combined contribution of 39.86%
of the value totals.  Datvest ETF advanced 0.19% to $19.6904 while, the Old
Mutual ETF declined 1.34% to end the day pegged at $79.9485. Cass Saddle
recorded and Morgan and Co   Made in Zimbabwe ETFs recorded no trades while,
Multi Sector ETF traded flat at $701.5000.

Global Currencies & Equity Markets

South africaSouth Africa

South African rand gains as gold prices surge

(Reuters) - South Africa's rand strengthened on Wednesday, with analysts
pointing to a surge in gold prices as the reason for the currency's
recovery.

At 1750 GMT, the rand traded at 18.83 against the U.S. dollar ZAR=D3, 0.7%
stronger than its previous close.

The currency, hurt by weak economic data, is down 2.8% against the greenback
since the beginning of the year.

"The recent gold price surge has offered the rand some relief," ETM
Analytics said in a research note, adding that the recovery will likely be
limited.

Gold prices held above the $2,100 level on Wednesday, near a record peak hit
in the previous session.

While the rand often tracks global economic developments and is considered a
riskier asset, it is also used by investors as a proxy for the yellow metal,
one of South Africa's major exports.

The dollar index=USD slipped 0.4% against a basket of currencies after U.S.
Federal Reserve Chair Jerome Powell said continued progress on inflation "is
not assured", though he still expected the central bank to cut interest
rates later this year.

On the Johannesburg stock market, the Top-40 .JTOPI index closed over 2%
higher.

South Africa's benchmark 2030 government bond ZAR2030= was up marginally,
with the yield down 0.5 basis point at 10.095%.

Nigeria

Naira Watch: Exchange Rate Falls to N1,602.43/$1

The official exchange rate of the naira against the dollar ended its
three-day winning streak, falling by 4.26% to N1602.43 per US dollar on
Tuesday, March 5, 2024, compared to N1534.19/$1, according to data published
by FMDQ.

This decline coincides with the announcement from the cryptocurrency trading
platform Binance that it will cease trading activities involving the
Nigerian currency.

The drop on Tuesday marks the first in three days, indicating that demand
pressures persist in the forex market as supply remains insufficient.

According to data from the Nigeria Autonomous Foreign Exchange Market
(NAFEM), where forex is officially traded, the domestic currency depreciated
by 4.26% at the end of trading, closing at N1,602.43 to a dollar at the
close of business.

This represents a loss of N68.24 compared to the N1,534.19 closing on
Monday. Meanwhile the intraday high was N1,652.40/$1, while the intraday low
was N1,450/$1, representing a spread of N202.40/$1.

According to data obtained from the official NAFEM window, forex turnover at
the close of trading was $291.78 million, representing a 63.26% increase
compared to the previous day.

Forex turnover has averaged over $200 million in the past week as trading
continues to pick up in the official market.

However, on the parallel market, the Naira depreciated against the dollar as
it was quoted for N1,630/$1, reflecting 1.84% compared to the previous day’s
quote of N1,600.

The Great British Pound (GBP) depreciated by 7.32% to close at £1/N2050 as
against £1/N1,900 the previous day.  Additionally, the Naira weakened
against the Euro by 0.57%, trading at N1750/EUR1 compared to N1740/EUR1
reported the previous day.

At above N1,600/$1, the exchange rate between the naira and dollar is down
by 43% in 2024 and remains one of the worst currencies in Sub-Saharan
Africa. This is despite several policy measures introduced by the apex bank
to resolve the forex crisis.

Officials close to the central bank have often cited the activities of
cryptocurrency traders as a major contributory factor to the exchange rate
depreciation. Critics of this government stand will point to the
depreciation of the naira as further evidence that the naira is inherently
weak with or without the activities of cryptocurrency traders.

 <mailto:info at bulls.co.zw> 

Global Markets

Dollar falls as Powell says Fed is on track to cut rates this year

(Reuters) - The dollar slipped across the board on Wednesday after Federal
Reserve Chair Jerome Powell said continued progress on inflation "is not
assured," though the U.S. central bank still expects to reduce its benchmark
interest rate later this year.

"If the economy evolves broadly as expected, it will likely be appropriate
to begin dialing back policy restraint at some point this year," Powell said
in remarks prepared for delivery to the House Financial Services Committee.

-

The euro was 0.37% higher against the dollar at $1.0897, after strengthening
to $1.09155, its highest since Feb. 2.

"Fed Chairman Powell's opening statement to Congress essentially repeated
the same main points that he and his colleagues have been hitting for
months," Matt Weller, head of market research at StoneX, said.

But Powell's words disappointed traders, who in recent weeks had begun to
speculate that the Fed would back away from any potential rate cuts in the
first half of the year, Weller said.

-

"With Fed Chairman Powell refusing to endorse that possibility, some
forward-thinking traders have reversed bullish bets on the greenback from
the past couple weeks," he said.

Powell will appear before the Senate Banking Committee on Thursday.

The dollar index , which measures the currency's strength against a basket
of six currencies, was down 0.41% at 103.36. The index had climbed as high
as 104.97, up about 3.6% for the year, in mid-February, helped by robust
U.S. economic data, but has retreated as recent reports showed some
softness.

Data on Wednesday showed U.S. private payrolls rose slightly less than
expected in February, while wages for workers remaining in their jobs
increased at the slowest pace in 2-1/2 years, consistent with a cooling
labor market. The Labor Department's more comprehensive and closely watched
February employment report is due on Friday.

"Job openings and ADP private payroll data keep the path open for Fed rate
cuts later this year," Bill Adams, chief economist for Comerica Bank, said
in a note, citing the report by Automatic Data Processing.

-

The dollar slipped on Tuesday after data showed U.S. services industry
growth slowed last month.

Traders also braced for the ECB's rate decision on Thursday with the central
bank expected to leave its benchmark interest rate at a record 4%, putting
the focus on clues about when cuts may begin.

"We think they are going to echo their message again and tomorrow is not
going to change the outlook," Danske Bank's Mellin said.

Elsewhere, sterling edged up 0.25% to $1.2738 as traders digested Britain's
latest fiscal plans, possibly the last budget before an election expected
later in the year.

British finance Minister Jeremy Hunt offered no surprises in his latest
statement, announcing a two percentage point cut to National Insurance
Contributions (NICs), while freezing fuel and alcohol duty.

Bitcoin was up 5.76% at $66,963, rebounding from Tuesday's sharp swoon after
it hit a new high. The cryptocurrency's recent price rise has been fueled by
investors pouring money into U.S. spot exchange-traded crypto products and
the prospect that global interest rates may fall.

Against the yen , the dollar was 0.45% lower at 149.38 yen on reports that
some Bank of Japan board members think it would be appropriate to lift rates
from below zero at the March meeting.

Analysts are mostly expecting the BoJ to exit negative rates at the April
meeting if Japan's spring wage negotiations result in solid pay hikes.

The U.S. dollar weakened 0.57% against its Canadian counterpart after the
Bank of Canada kept its key overnight rate steady at 5% on Wednesday as
expected and said it was still too early to consider a cut, given persistent
underlying inflation.

The Australian dollar brushed off gross domestic product growth of a mere
0.2% in the fourth quarter, reinforcing the case for rate cuts. The currency
was last up 0.94% at $0.6565.

 <mailto:info at bulls.co.zw> 

Commodities Markets

Price of Gold holds above US$2100 amid hopes of US rates easing

Gold purchases from central banks led to last year’s surge, with purchases
exceeding 1 000 tonnes for two consecutive years

Gold prices held above the US$2 100 level yesterday, near a record peak hit
in the previous session as hopes for US rates easing by mid-year mount,
while traders awaited remarks on the economy’s health from Federal Reserve
Chair Jerome Powell.

Spot gold edged down 0,1 percent at US$2 126.13 per ounce, as of 0458 GMT.
US gold futures GCcv1 fell 0,4 percent to US$2 134.30.

Spot prices hit a record peak of US$2 141.59 per ounce overnight on Tuesday,
rallying for a fifth straight session.

Gold’s rally is sentiment driven, which was triggered by last week’s poor US
economic data that gave little more clarity for a June rate cut, said Ajay
Kedia, director at Kedia Commodities, Mumbai, adding, without other factors
at play, such as dollar’s movement, or any surge in geopolitical tensions,
gold could see profit taking.

Traders are weighing risks to the US economic health in a high-interest rate
environment and would be tuning into Powell’s first day of semi-annual
congressional testimony for more clarity on the same.

US services industry growth slowed a bit in February amid a decline in
employment and new orders for US manufactured goods dropped more than
expected in January.

Data on the US labour market due this week will also be closely watched for.
Any downside surprise could help support gold.

Traders see a 71 percent chance for a June Fed rate cut. Lower rates boost
the appeal of non-yielding bullion.

“The central banks are buying more than 1 000t of gold consecutively from
the last two years, versus the historic average of 300t.

This has made-up for all the loss in the retail and ETF demand,” said Kunal
Shah, head of research, Nirmal Bang Commodities, Mumbai.

Spot platinum rose 0,4 percent to US$884.16 per ounce, and palladium rose
over 1 percent to US$958,20, while silver dropped 0,3 percent to US$23,63.
– CNBC Africa

INVESTORS DIARY 2024

Company

Event

Venue

Date & Time

Art

AGM

virtual (escrow platform)

March 7. 2:30

2024 auction tobacco marketing season opens

13 march

Good Friday

march 29

Easter Monday

1 April

Independence Day

April 18

Workers day

1 May

Counters trading under cautionary

CBZH

GetBucks

EcoCash

Padenga

Econet

RTG

Fidelity

TSL

FMHL

ZBFH

Invest Wisely!

Bulls n Bears 

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opinions expressed and recommendations made are subject to change without
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for guideline purposes only and sourced from third parties.

 (c) 2024 Web: www.bullszimbabwe.com Email: bulls at bullszimbabwe.com Tel: +27
79 993 5557 | +263 71 944 1674

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