No respite for ZSE in 2016

HARARE - The Zimbabwe Stock Exchange (ZSE)’s bearish mode continued into 2016 with the local bourse’s benchmark industrial index slipping into fifth successive loss in thinly-traded sessions during the first week of January.

On Friday last week, only 10 stocks were active for the day with thinner exchanges.

Statistics from EFE Securities show that there were no risers for the day while three counters traded softer with two of the fallers coming from the industrials cluster.

NMB and Dairibord were the two industrial shakers that succumbed 10,1 percent and 0,57 percent to settle at $0,0330 and $0,0685 respectively.

The two losses saw the benchmark Industrial Index let go 0,05 percent for the day and settle at 112,16 points.

“The Mining Index finally broke its four session run of holding stable in the New Year with a 3,26 percent drop to 23,48 points weighed down by nickel miners Bindura that came off 6,25 percent to $0,0150 as its year-end rally starts to lose steam,” the equities firm said in a report.

EFE noted that activity aggregates thinned out on Friday with volumes shrinking 62,8 percent to 1 839 957 shares.

Telecommunications giant Econet emerged the major driver of the volume having contributed 64 percent of the total.

“Values of the day fell below the psychological $1 million mark to $314 903,35 on the back of the thin trades and fewer active stocks.

“Econet again led the values of the day driving 79 percent of the aggregate while other notable trades were seen in Simbisa, CBZ and Dairibord.

“Foreign inflows were a paltry $3,384 shedding 99,79 percent on Thursday trade. Portfolio disposals were down 89,19 percent at $0,167 million as the market set a net funds outflow position for the day. Foreign selling for the day was recorded in Econet,” EFE said.

The Zimbabwe Stock Exchange was consistently bullish for the better part of 2015 despite the industrial and mining indices surging by 0,65 percent and 12,79 percent towards the end of the year.

In his 2016 National Budget statement, Finance minister Patrick Chinamasa noted that performance of the local bourse remained depressed since the beginning of the year, owing to illiquid conditions and high trading costs, among others.

“The main-stream index opened the year at 162,79 points, and had declined to 131,93 points by end September 2015, while market capitalisation fell by 20 percent from $4,33 billion to $3,44 billion over the same period,” he said.

“The on-going efforts by government to grow the economy, underpinned by positive sentiments arising from accelerated re-engagement with the international financial institutions, augurs well for the recovery of market activity at the ZSE from 2016,” Chinamasa added.

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