Bulls n Bears Daily Market Commentary : 15 January 2025

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Bulls n Bears Daily Market Commentary : 15 January 2025

 

 	



 

 	


ZSE commentary 

 

ZSE slips into red...

 

The ZSE market slipped into red in the midweek session as the primary All Share Index lost 0.90% to 207.72pts while, the Blue-Chip Index fell 0.74% to 206.85pts . The Agriculture Index eased 2.57% to 173.20pts as the Mid Cap Index went down 1.62% to 235.80pts. Masimba Holdings Limited led the laggards of the day on a 9.09% drop to $3 .0000, followed by Star Africa that trimmed 7.55% to $0.0225. Cafca tumbled 4.88% to settle at $19.5000 while, banking group CBZ plunged 0.70% to $8.5000. Cigarette manufacturer BAT completed the fallers of the day on a 0.05% retreat to end the day pegged at $105 .0000. Partially mitigating today's losses was Hippo that went up 0.66% to $5.2713 while, retailer OK Zimbabwe ticked up 0.44% to $0.3533. Ecocash inched up 0.17% to settle at $0.3000 while,telecoms giant Econet firmed up 0.08% to close at $2.9947. The market closed with a negative breadth of six after ten counters recorded losses against four that gained.

 

 

Activ ity aggregates were mixed in the session as volume traded grew 134.82% to 3.46m shares while,total value traded declined by 75.58% to $1.37m. Star Africa (92.70%) highlighted the total volume traded of the day. Top value drivers of the day were FBC (45.62%), Econet (14.60%) and Delta (11.08%). No trades were recorded in the ETF section. Tigere REIT eased 0.50% to end the day pegged at $1.1940. Revitus REIT declined 3.49% to settle at $0.9000 after 312 units exchanged hands in the name.

 

 

VFEX reverses prior session's gains...

 

The VFEX market reversed prior session gains as the All Share Index lost 0.33% to 103.32pts . Axia headlined the worst performers of the day on a 5 .11% retreat to $0.0948 while, seed producer SeedCo dropped 3.74% to $0.2500. Fast foods group Simbisa parred off 1.33% to $0.3201 while, Padenga slipped 0.76% to end the day pegged at $0.1820.Trading in the positive was African Sun that ticked up 11.04% to $0.0352.

 

 

 

Activity aggregates enhanced in the session as volumes traded grew  43.62%  to  963,586  shares  while,  turnover  went  up

90.94% to $95,385 .QS. Top volume drivers of the day were First Capital (76.40%) and Simbisa 19.91%). The duo of Simbisa and First Capital claimed 64.38% and 30.95% of the value aggregate respectively.

 

-efesecurites

 <mailto:info at bulls.co.zw> 

 

 

South Africa

 

South African rand gains after hitting 9-month low, US inflation data in focus

 

 

South Africa's rand firmed early on Tuesday, 14 January 2025 against a stronger dollar, as markets looked to US inflation data due on Wednesday for clues on the Federal Reserve's interest rate path.

 

At 0546 GMT, the rand traded at 18.9850 against the US dollar, about 0.2% stronger than its previous close. The greenback last traded about 0.1% stronger against a basket of currencies.

 

The rand hit a nine-month low on Monday before staging a recovery, against a stronger dollar amid an uncertain outlook for further interest rate cuts by the Fed.

 

"There is not much that can be read into the rand's overnight recovery back below the 19.00 handle. Although it is welcome, the US inflation data... could change all that again," ETM Analytics said in a note.

 

Recent US data underscored the strength of the economy, leading traders to scale back bets for 2025 rate cuts.

 

South Africa's benchmark 2030 government bond was little changed in early deals, with the yield at 9.315%.

 

 

 

 

Nigeria

 

 

Naira Pulls Back as CBN Contribution in FX Market Shrinks

The naira is pulling back in a successive manner across foreign exchange markets. The exchange rates plunged market wide as the central bank contribution in the forex market continues to shrink on the back of subpar FX sales to banks to boost liquidity. 

 

In the official window, the naira fell by 10 basis points against the US dollar again on Wednesday as analysts cited a sustained forex supply challenge. Spot FX data from the FMDQ platform showed that the naira fell by 0.10% to close at N1,549.20 per US dollar on Wednesday.

 

Report showed that the CBN intervened in the FX market on Tuesday, selling $98.75 million to banks between the rate of ₦1,545 – ₦1,553 to boost FX liquidity in the official window as part of broader efforts to stabilise the naira.

 

Also, the parallel market also saw a 0.18% depreciation, closing at an average of N1,666 per greenback as demand eclipsed total FX supply.

 

FX liquidity challenge has continued to worsen in 2025 across currency market. This trend has left the market with no choice rather to price down the naira value against US dollar and other bellwether currency.

 

The CBN contribution in the forex supply settle at less than 8% of the total US dollar volume in the official window last week.

 

According to Coronation Research, the Nigerian autonomous foreign exchange market window recorded an inflow of US$289.10 million last week, down from US$419.90 million in the previous week.

 

However, the CBN only contributed 7.85% of the total inflow. Foreign portfolio investors (FPIs) strengthened the FX inflows, accounting for 36.63% of the US dollar volume.

 

Data showed that non-bank corporates contributed 25.80%, exporters added 27.17%, while other sources accounted for 2.55%. Analysts said FX inflows in the official market has been declining gradually since the Apex Bank began to withdraw from FX intervention in the market.

 

In the global commodities market, oil prices saw a modest uptick on Wednesday as West Texas Intermediate (WTI) crude futures rose by 1.23%, surpassing $78 per barrel, while Brent crude gained 1.04% to close at $80.75 per barrel.

 

The rally was primarily driven by softer US core inflation data, which fuelled expectations that the Federal Reserve might begin easing interest rates. In its latest report, the International Energy Agency (IEA) expressed caution regarding the full impact of geopolitical sanctions on the oil market, suggesting a level of uncertainty about how these measures will play out.

 

On the other hand, OPEC maintained its outlook for global oil demand growth, forecasting an increase of 1.43 million barrels per day by 2026.Naira Pulls Back as CBN Contribution in FX Market Shrinks 

 

 

 <mailto:info at bulls.co.zw> 

 

Global Markets

 

Dollar ends session weaker as inflation eases; yen firms on BOJ talk

 

(Reuters) - The dollar pared some losses against major peers on Wednesday but stayed weaker as cooler-than-expected data eased fears that inflation was accelerating and increased the chances the Federal Reserve could cut interest rates twice this year.

The Bureau of Labor Statistics showed consumer prices rose 2.9% in the 12 months through December, in line with economists' expectations. Core inflation, which excludes food and energy prices, came in as expected, but lower than the previous month.

 

Softer core reading coupled with producer prices data on Tuesday triggered an immediate decline in the dollar.

The dollar index , which measures the greenback against six other units, was down 0.1% at 109.07. It hit a 26-month high of 110.17 on Monday.

"The cooler inflation print was a sign for traders to cut some long positions in the dollar, said Joseph Trevisani, senior analyst at FX Street in New York.

 

 

Trevisani thinks the Fed will be very wary about resuming rate cuts until there's absolute certainty that inflation is headed back down. He doesn't think it.

With President-elect Donald Trump returning to the White House next week, analysts expect some of his policies to boost growth as well as increase price pressures.

John Velis, head of FX and macro strategy for the Americas, at BNY Markets, said going forward markets will be watching future inflation reports to see if they confirm the slow disinflation progress.

But the new incoming administration will likely enact policies that upend many baseline expectations for the first part of the year, he added.

"We expect the Fed to stand pat on January 29th, and rate cuts not to resume until much later in the year, pending disinflation's progress," said Velis.

Meanwhile the dollar was down 0.93% on the Japanese yen at 156.49 yen.

The yen strengthened on Wednesday after comments from the Bank of Japan Governor Kazuo Ueda, who said the central bank would raise interest rates and adjust the degree of monetary support if improvements in the economy and price conditions continue.

 

Meanwhile, a cooling in British inflation offered relief to the pound. Data showed inflation slowed unexpectedly last month and core measures of price growth - tracked by the Bank of England - fell more sharply - welcome news for finance minister Rachel Reeves after a market selloff.

The British pound was last seen up 0.1% at $1.2229 against the dollar, while the euro was down 0.15% at $1.0299 .

"Dollar strength is not going to end because of this (CPI)number," said Peter Vassallo, FX portfolio manager at BNP Paribas Asset Management. "It's going to probably become more nuanced, and we might see the dollar continue to be strong against the European currencies, but not as strong against the yen."

Israel's shekel rose as much as 0.8% against the dollar to its strongest in a month and was last up 0.4% at 3.61 per dollar, after a Gaza ceasefire deal was reached on Wednesday. International government bonds issued by Israel and Jordan rose on the news.

Eyes were also on China, where the onshore yuan stayed flat on the day and was last at 7.3319 per dollar, overall maintaining a generally weak bias despite a persistently firmer than expected official guidance fix and signs of tightness in domestic money markets.

Get the latest news and expert analysis about the state of the global economy with the Reuters Econ World newsletter. Sign up here.

Reporting by Laura Matthews in New York; Additional reporting by Alun John in London and Rae Wee in Singapore; editing by Mark Heinrich and Nick Zieminski

 

.

 

 

 <mailto:info at bulls.co.zw> 

 

Global Markets 

 

Gold price surges following December Consumer Price Index release

 

Gold prices rallied significantly today following the release of December's Consumer Price Index (CPI) data, with futures gaining $29.50 or 1.10%, as investors digested the latest inflation figures and their implications for the Feds monetary policy.

 

 

The U.S. Bureau of Labor Statistics reported that inflation rose 0.4% in December, exceeding both November's 0.3% increase and analysts' consensus estimate of 0.3%. The annual inflation rate stood at 2.9% before seasonal adjustments. Core CPI, which excludes volatile food and energy prices, showed a 3.2% annual increase, slightly below the expected 3.3%.

 

 

 

Energy costs played a substantial role in December's inflation reading, rising 2.6% and accounting for over 40% of the monthly increase. Gasoline prices saw a notable jump of 4.4%. Food prices also contributed to the overall increase, with both at-home and restaurant prices rising 0.3%.

 

"Today's softer-than-expected core CPI reading should help cool fears of a reacceleration in inflation," noted Tina Adatia, head of fixed income client portfolio management at Goldman Sachs Asset Management. "While today's release is likely insufficient to put a January rate cut back on the table, it strengthens the case that the Fed's cutting cycle has not yet run its course."

 

The CPI data follows Tuesday's Producer Price Index (PPI) report, which showed wholesale prices rising more modestly than anticipated. The PPI advanced 0.2% in December, with higher goods costs balanced by stable services prices. For the full year 2024, the final demand index rose 3.3%, following a 1.1% increase in 2023.

 

Market reaction was pronounced, with gold's gains the result of both dollar weakness, and persistent inflation. The dollar index fell 0.51% to 109.182, accounting for roughly half of gold's upward move. The remainder of gold's advance reflected direct buying interest in the precious metal. As of 5:00 PM EST gold futures based the most active February contract is fixed at $2722.60, after factoring in today’s gain of $29.50, a 1.10% increase.

 

teaser image

 

 

The combined December CPI report and yesterday’s PPI report suggest that while price pressures aren't rapidly subsiding, they're not showing signs of reacceleration either. This nuanced picture may influence the Federal Reserve's approach to monetary policy in the coming months.

 

The latest inflation data and market reactions underscore gold's traditional role as an inflation hedge that also protects investors against economic and political uncertainty. As economic policy shifts and inflation concerns persist, the precious metal continues to attract investor interest, suggesting sustained momentum in the gold market through 2025.

 

Looking ahead, gold's outlook appears particularly bullish, supported by several potential catalysts. The incoming Trump administration's proposed economic policies, including new tariffs and additional tax cuts, which could fuel inflationary pressures. These factors, including dollar weakness, could drive gold prices beyond October's record high of $2,800, and reach $3,000 by the third quarter of this year.

 

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Wishing you, as always good trading,

 

 

 


 

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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DISCLAIMER: This report has been prepared by Bulls ‘n Bears, a division of Faith Capital (Pvt) Ltd for general information purposes only and does not constitute an offer to sell or the solicitation of an offer to buy or subscribe for any securities. The information contained in this report has been compiled from sources believed to be reliable, but no representation or warranty is made or guarantee given as to its accuracy or completeness. All opinions expressed and recommendations made are subject to change without notice. Securities or financial instruments mentioned herein may not be suitable for all investors. Securities of emerging and mid-size growth companies typically involve a higher degree of risk and more volatility than the securities of more established companies. Neither Faith Capital nor any other member of Bulls ‘n Bears nor any other person, accepts any liability whatsoever for any loss howsoever arising from any use of this report or its contents or otherwise arising in connection therewith. Recipients of this report shall be solely responsible for making their own independent investigation into the business, financial condition and future prospects of any companies referred to in this report. Other  Indices quoted herein are for guideline purposes only and sourced from third parties.

 

 	

 

 

 	


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