Bulls n Bears Daily Market Commentary : 09 January 2025

Fri Jan 10 08:29:15 CAT 2025

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Bulls n Bears Daily Market Commentary : 09 January 2025

ZSE commentary 

Bloodbath persist on the ZSE ...

Bloodbath persisted on the ZSE market as the All Share Index retreated 0.86%
to 207.62pts while, the Blue-Chip Index was 0.82% weaker at 205 .63pts.The
Agriculture Index eased 0.99% to close trading at 173.16pts while, the Mid
Cap Index was 1.07% lower at 240.19pts. Leading the laggards of the day was
Nampak that plummeted 12.28% to $1.0000 while, packaging company Proplastics
trimmed 11.39% to $1.1251. TSL shed 9.07% to close at $2.0000 while, Ecocash
tumbled 8.98% to settle at $0.2704.  Seed technology group SeedCo Limited
dipped 7.52% to $2.1009 as it capped the top five worst performers of the
day. Trading in the positive category was General Beltings that ballooned
56.00% to $0.0780 while, retailer OK Zimbabwe edged up 14.43% to $0.3982 .
Zimre Holdings surged 7.12% to close pegged at $0.1505 while, cigarette
producer  BAT  added  2.89%  to  close  trading  at $92 .6000. Beverages
giant Delta ticked up 0.15% to settle at $13 .9780.

Activity aggregates were mixed in the session as volumes traded fell rose
21.24% to 6.07m shares while, turnover fell by 39.51% to $8.69m. Top volume
drivers of the day were Proplastics (41.25%), Ok Zimbabwe (34.21%) and
Econet (11.34%). Top turnover drivers of the day were the trio of
Proplastics, Econet and Delta that claimed a combined 71.87% of the total
traded. The Old Mutual Top 10 ETF gained 3.43% to $0.1965 as the fund
prepares to delist on the 13th of January. In the REIT category, the Tigere
REIT was 0.13% firmer at $1.2005 as 353,050 units traded in the name.
–efesecrites

 <mailto:info at bulls.co.zw> 

South Africa

South African rand steady against dollar

(Reuters) - South Africa's rand was steady on Thursday as investors mulled
over the outlook for U.S. interest rates and the potential for aggressive
tariffs by President-elect Donald Trump.

At 1512 GMT, the rand traded at 18.90 against the dollar , not far from its
previous close.

This week, investors have been digesting reports about Trump's tariff plans,
U.S. labour market data pointing to continued resilience, and minutes of the
Federal Reserve's last meeting that lifted expectations for fewer rate cuts
in 2025.

Domestically, South Africa's manufacturing output in November fell 2.6% year
on year after rising by a revised 0.9% in October, statistics agency data
showed.

On the stock market, the Top-40 (.JTOPI), opens new tab index closed 0.8%
higher.

Zambia

Zambia’s Kwacha Faces Record Low Amid Ongoing Drought and Economic Struggles

Zambia’s currency, the kwacha, has continued its downward slide, reaching a
historic low against the U.S. dollar, with the exchange rate recently pegged
at 27.95 ZMW to 1 USD.

The persistent depreciation of the kwacha has raised alarm bells across the
Southern African nation, highlighting the growing economic challenges facing
the country.

The kwacha’s decline is being largely driven by a combination of factors,
primarily the severe drought that has been gripping Zambia.

The country is grappling with one of the worst dry spells in a century,
linked to the El Niño phenomenon, which has significantly impacted
agriculture, hydroelectric power generation, and copper production—key
pillars of Zambia’s economy.

The drought has cut electricity production from the Kariba dam, reducing the
country’s ability to generate enough power for industrial activities, thus
further straining the economy.

Experts have noted that the depreciation of the kwacha is exacerbated by a
slowdown in Zambia’s copper production, the country’s main export and a
crucial source of foreign revenue. With less copper coming to market and
lower foreign exchange inflows, Zambia is facing a difficult road to
economic recovery.

The kwacha’s fall is especially concerning as it follows a series of
economic hurdles for the country. Despite emerging from a debt default in
2024, the kwacha has weakened by approximately 15% over the past six months.

The nation’s fiscal outlook has remained bleak, and the currency has lost
about 3% of its value since the country reached a debt restructuring
agreement late last year.

In response to the currency’s slide, the Bank of Zambia took action in
November 2023, raising reserve ratio requirements in a bid to stabilize the
currency and prevent further depreciation.

However, despite these measures, the kwacha has continued to falter, raising
questions about the effectiveness of the central bank’s interventions.

Zambia’s struggling economy and the depreciation of its currency have
significant implications for the cost of living.

With the price of imports soaring, many Zambians are feeling the squeeze,
particularly in urban areas where inflation has eroded the purchasing power
of ordinary citizens. For businesses, especially those dependent on imports,
the rising costs are compounding the already difficult operating
environment.

The outlook for Zambia’s economy remains uncertain. While the country’s
agriculture sector is beginning to show signs of recovery, with the new
farming season under way, it is unclear how quickly Zambia will be able to
weather the effects of the ongoing drought.

Furthermore, the government’s efforts to diversify the economy and attract
more foreign investment may be hindered if the currency remains weak and
economic instability persists.

As the kwacha continues to slip, many are looking for signs of recovery in
Zambia’s broader economic strategy. The country’s ability to navigate this
crisis will depend not only on managing the immediate drought but also on
the long-term sustainability of its economic reforms and diversification
efforts.

For now, the residents of Zambia are left hoping for relief, with the belief
that stronger policies and a recovery in key industries, such as mining and
agriculture, may eventually steer the country out of its current economic
turbulence.

 <mailto:info at bulls.co.zw> 

Global Markets

Dollar gains extend ahead of U.S. jobs reading

The dollar looked set to extend its longest weekly winning streak in over a
year on Friday, underpinned by rising bond yields and expectations of
another strong set of U.S. jobs numbers.

The dollar

has gained 0.5% on the yen

this week to buy 158.03 yen and added more than 1% on an ailing British
pound

, which was battered to a 14-month low in tandem with a selloff in gilts and
concern about British finances.

The dollar is set for a broadly steady week on the euro

, which buys $1.0926 and it has notched small gains on the Australian and
New Zealand dollars.

The dollar index

is set for a sixth consecutive weekly gain, its longest run since an 11-week
streak in 2023 as the U.S. economy continues to seem strong in contrast with
weaknesses elsewhere.

The index was steady in the Asia morning on Friday for a 0.25% weekly rise
to 109.18.

"We doubt the dollar needs to hand back much of its recent gains," said
Chris Turner, global head of markets at ING, noting a shakeout in sterling

long positions and risks to the upside for the dollar from U.S. jobs data
due later in the day.

"Despite the risk of profit-taking, (the dollar index) found good support
under 108 earlier this week."

Sterling

was last a fraction weaker at $1.2295, having touched a 14-month low of
$1.2239 earlier in the week. The Australian and New Zealand

dollars are huddled near multi-year lows, with the Aussie

- last at $0.6190 - having come within a whisker of breaking a 2022 low of
$0.6170.

The New Zealand dollar is also testing its 2022 low of $0.5512 and was last
at $0.5594.

Payrolls

U.S. non-farm payrolls data is expected to show 150,000 jobs were added in
December, with unemployment holding at 4.2%.

A hint of anything much stronger would add to the case for fewer Federal
Reserve rate cuts and may set off another round of selling in jittery bond
markets.

Overnight Philadelphia Fed President Patrick Harker said he expects the U.S.
central bank to cut interest rates, but added that an imminent move down
isn't needed.

Markets have already scaled back expectations to around 40 basis points of
U.S. rate cuts for 2025, while concerns about President-elect Donald Trump's
potentially inflationary agenda have helped drive up longer-term yields.

Ten-year Treasury yields

have climbed nearly 9 basis points this week to 4.68% and are up 96 bps
since mid September. 

Ten-year gilt yields are up 22 bps this week to 4.805%. 

Unusually, the ructions in the bond market seem to have been felt by
cryptocurrencies, with bitcoin

down 5.7% on the dollar through the week to $92,600.

"I'm not sure how many in the crypto scene would have been aware of ... the
dynamics shaping up in U.S. rates/Treasuries, and many will be questioning
the factors behind the move in crypto," said Pepperstone's head of research,
Chris Weston.

 <mailto:info at bulls.co.zw> 

Global Markets

Gold gains for third day before US data that may shape rate path

Gold rose for a third day as traders mulled the outlook for the Federal
Reserve’s easing path, ahead of key jobs figures due later Friday.

Bullion traded near $2,670 an ounce — touching the highest since
mid-December — but showed limited movements with some US financial markets
closed Thursday. Recent data showed US private-sector hiring and wage growth
slowed in December. 

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The Fed will need to balance that against renewed inflation fears when
deciding on cutting rates, with minutes of its meeting last month
reaffirming a more cautious approach to easing. Lower borrowing costs are
typically positive for gold, which doesn’t offer interest.

Traders are now shifting attention to Friday’s payrolls data for December,
which are expected to show moderating yet still-healthy job growth that
economists expect to carry on in 2025. A survey conducted by 22V Research
showed most investors are watching the report more closely than usual.

Bullion surged 27% last year in a record-breaking run that was propelled in
part by US monetary easing, though the rally lost momentum after Donald
Trump’s US presidential election victory buoyed the dollar. Bulls now face
the prospect of less impressive gains this year, with Goldman Sachs Group
Inc. pushing back a target for gold hitting $3,000 to mid-2026 on
expectations for fewer Fed cuts.

Spot gold added 0.2% to close at $2,667.25 an ounce at 5 p.m. in New York.
The Bloomberg Dollar Spot Index was up 0.1%. Platinum and palladium were
steady, while silver edged higher.

INVESTORS DIARY 2025

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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