Bulls n Bears Daily Market Commentary : 20 May 2025

Wed May 21 05:41:51 CAT 2025

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Bulls n Bears Daily Market Commentary : 20 May 2025

ZSE commentary

ZSE extends gains in Tuesday's trades...

The ZSE market extended gains in the session as the All Share Index gained 0.23% to 194.17pts while, the Blue-Chip Index ticked up 0.49% to 187.32pts. The ZSE Agriculture Index added 0.23% to end pegged at 192.70pts while, on the contrary the Mid Cap Index fell 0.51% to 242.43pts. Sugar processor Star Africa headlined the gainers' list of the day on a 24.04% upsurge to $0.0360 while, Zimre Holdings trailed behind with a 6.71% increase to close at $0.3500. Spirit and wines producer

AFDIS edged up 3.03% to $6.8000 while, banking group CBZ Holdings advanced 2.68% to close at a VWAP of $7.1875. Hippo Valley capped the top five winners of the day on a 2.12% uplift to end pegged at $8.2008. Trading in the negative was banking group ZB that lost 15.00% to close at lower circuit breaker level of $4.6750 while, Tanganda declined 6.64% to $0.8132. Masimba Holdings retreated 0.55% to $3.5800 as telecommunications giant Econet parred off 0.39% to $2.7404. Ecocash Holdings capped the top five worst performers' list of the day on a 0.10% loss to $0.1299.

Activity aggregates improved in the session as turnover jumped 146.37% to $25.75m while, volume traded ballooned 1,122.51% to 10.13m shares. Activity was mainly confined in Econet in the session as it claimed 63.56% of the volume traded and 68.53% of the value traded. The other notable volume driver was Mashonaland Holdings with a 15.71% contribution while, Delta claimed 18.69% of the value traded. Cass Saddle ETF charged 15.00% to close at $0.1150 as 10,000 units traded in the name. The Tigere REIT fell by 1.03% to $1.2000 as 357,938 units exchanged hands.

Losses persist on the VFEX...

Losses continued to persist on the VFEX market as the All Share Index retreated by 2.32% to 107.82pts. Padenga holdings led the laggards of the day as it shed 10.07% to settle at $0.2501 while, First Capital followed on a 5.84% decline to $0.0500. SeedCo International slid 2.32% to close at $0.1810 as 2,790 shares traded in the name. Partially mitigating today's losses was Caledonia that firmed up 2.17% to $16.45 while, conglomerate Innscor rose by 0.13% to $0.4720 Activity aggregates traded mixed in the session as turnover dipped 24.60% to $4,623.08 while, volumes traded fell by 41.51% to 26,770 shares. First Capital and Innscor drove volume and value aggregates of the day as they claimed a combined 81.58% of the volume and 76.19% of the value traded. Efesecrieties

 <mailto:info at bulls.co.zw> 

South Africa

South African rand steady ahead of budget, US meeting

(Reuters) – South Africa’s rand was steady on Tuesday, as investor focus turned towards this week’s budget speech and a meeting between President Cyril Ramaphosa and his U.S. counterpart Donald Trump.

At 0811 GMT, the rand traded at 18.08 against the dollar, not far from its previous close on Monday.

Finance Minister Enoch Godongwana will try to pass a budget for the third time on Wednesday, after his previous two attempts failed to gain support of some coalition partners over plans to increase tax.

The South African delegation arrived in Washington on Monday to hold talks with Trump’s administration in a bid to reset strained ties between the nations. The meeting between the two heads of state is planned for Wednesday.

On the stock market, the Top-40 index was little changed.

South Africa’s benchmark 2030 government bond was flat, with the yield at 8.88%.

Nigeria

Naira Gains Strongly Against Dollar in Black Market

The naira recorded a significant gain against the U.S. dollar in the parallel foreign exchange market on Monday, reflecting renewed strength in Nigeria’s local currency.

Abubakar Alhasan, a Bureau de Change operator based in Wuse Zone 4, Abuja, reported that the naira appreciated sharply to N1,617 per dollar, compared to N1,635 traded at the close of last week. This marks an N18 gain within a single trading day.

Naira

Meanwhile, the official exchange rate also reflected a slight improvement. According to data published by the Central Bank of Nigeria (CBN), the naira appreciated marginally by N0.04, closing at N1,598.68 to the dollar on Monday—up from N1,598.72 recorded last Friday.

The currency’s uptick comes amid market anticipation ahead of the Central Bank’s Monetary Policy Committee (MPC) meeting, where a key decision on benchmark interest rates is expected to be announced on Tuesday. Analysts suggest the MPC’s move could influence investor sentiment and further shape the naira’s trajectory in the days ahead.

 <mailto:info at bulls.co.zw> 

Global Markets

Dollar falls on more downbeat Fed comments; focus on Japan talks, House vote

(Reuters) - The U.S. dollar weakened anew on Tuesday, weighed down in part by more cautious remarks about the economy by Federal Reserve officials, even as traders looked ahead to upcoming U.S. talks with Japan that could include discussions on currencies as part of a trade deal.

The greenback also was pressured by news President Donald Trump failed to convince Republican holdouts in the House of Representatives to back his sweeping tax bill. Trump met with Republicans on Tuesday to press his fellow party members to support the legislation.

The dollar had sold off broadly on Monday after Moody's downgraded the U.S. sovereign credit rating due to deficit concerns on Friday.

"The underlying bias is still to sell the dollar. I don't think that bias has changed," said Vassili Serebriakov, FX strategist, at UBS in New York.

Fed officials on Tuesday also doubled down on their concerns about the impact of the Trump administration's trade policies on the economy. St. Louis Federal Reserve Bank president Alberto Musalem said despite the recent U.S. and China trade tension easing, the labor market looks likely to weaken and prices to head higher.

Cleveland Fed President Beth Hammack told Axios that current trade developments could lead to stagflation, opens new tab, though other policies from the administration could offset that.

On Monday other Fed officials talked about the ramifications of the latest downgrade of the U.S. government's credit rating and unsettled market conditions as the Fed continued to navigate a very uncertain economic environment.

In afternoon trading, the dollar fell against the yen to a roughly two-week low of 144.095 yen. It was last down 0.2% at 144.495 yen , sliding in five of the last six sessions.

Tuesday's sell-off in long-dated Japanese government bonds, which pushed 30-year yields to record highs and those on the 20-year to a nearly 25-year peak, pressured the yen earlier, analysts said.

Also on traders' radar were upcoming U.S.-Japan talks, with Japanese Finance Minister Katsunobu Kato saying he expects any meeting with U.S. Treasury Secretary Scott Bessent on exchange rates to be based on their shared view that excessive currency volatility was undesirable.

Kato and Bessent are expected to meet on the sidelines of a G7 finance leaders' gathering to be held this week in Canada.

Comments from Japan's top trade envoy on Tuesday that Tokyo was firm in its anti-tariff stance pointed to no easy off-ramp in the negotiations in the weeks and months ahead.

RBA CUT, U.S. BUDGET PICTURE

Elsewhere, the Australian dollar dropped against the U.S. dollar after the Reserve Bank of Australia cut benchmark interest rates by 25 basis points and left the door open to further easing in the months ahead. The Aussie dollar was last down 0.6% at US$0.6416 .

The Chinese yuan weakened against the dollar as China cut key benchmark lending rates while corporate seasonal demand for dollars remained high.

Market attention is now focused on a key vote planned by the end of the week in the U.S. House of Representatives. Republican leaders in the chamber said they would press forward with the tax bill despite its uncertain prospects.

Trump's bill would add $3 trillion to $5 trillion to the country's debt, according to nonpartisan analysts. Ballooning fiscal debt, trade frictions, and weakened confidence have weighed on U.S. assets.

The U.S. dollar index has tumbled as much as 10.6% from its January highs, one of the sharpest retreats for a three-month period. It got a breather, however, after Trump paused many of the largest tariffs he announced last month.

And in the wake of Trump's tariff turmoil, Britain on Monday agreed to the most significant reset of defence and trade ties with the European Union since Brexit.

The pound was last up 0.2% at $1.3387 , having risen 0.6% on Monday.

The euro, meanwhile, rose 0.3% against the dollar to $1.1279 , while the Swiss franc strengthened, pushing the dollar down 0.6% at 0.8295 franc.

Currency bid prices at 20 May 07:35 p.m. GMT

 <mailto:info at bulls.co.zw> 

Gold rallies on US credit downgrade, bulls target $3,300

Gold price advances for the second straight day on Tuesday as the Greenback continues to print losses due to uncertainty about trade policies and the fiscal health of the United States (US) following last Friday’s Moody’s US debt downgrade. The XAU/USD trades at $3,289, up by more than 1.50% at the time of writing.

Demand for the yellow metal has increased as US equity markets turned red during the North American session. Moody’s adjustment to US government debt from AAA to AA1, stable with a negative outlook, weighed on investor sentiment, leading to increased positions in Gold.

In the meantime, Federal Reserve (Fed) officials' tone remains cautious. However, none of them has opened the door for reducing interest rates amid an ongoing economic slowdown in the US. On Monday, the Atlanta Fed’s Raphael Bostic said that he favors one cut in 2025.

Beth Hammack of the Cleveland Fed stated that US government policies have increased the difficulty for the Fed to manage the economy and fulfill the dual mandate role. She said that the odds of a stagflationary scenario are rising. Recently, the St. Louis Fed's Alberto Musalem noted that monetary policy is well-positioned.

Consequently, US Treasury yields remain elevated during the session, but it has not been an excuse for Gold prices to rally.

Major central banks reducing interest rates are also bullish for Bullion. During the Asian session, the People’s Bank of China (PBoC) lowered interest rates, followed by the Reserve Bank of Australia (RBA), which cut the Cash Rate from 4.10% to 3.85%.

Aside from this, geopolitics are also playing a role in setting XAU/USD prices higher as failure to achieve a ceasefire between Russia and Ukraine and rising tensions in the Middle East could keep investors leaning into the yellow metal.

This week, traders will eye Fed speeches, Flash PMIs, housing data and Initial Jobless Claims.

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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