eBusiness Weekly
The Zimbabwe Stock Exchange (ZSE) continued on a downward trend for the third consecutive week as the market’s heavy cap counters tumbled.
In the week to Wednesday, three of the benchmarks closed in the negative as the exchange rate continued to worsen on persistent inflationary pressures that are eroding disposable incomes.
According to the Economist Intelligence Unit (EIU) the country’s foreign currency interbank rate should, however, decline to around $7 against the USD by 2021, which will be a 70 percent decline from current figures of around $15 to the greenback.
On the illegal parallel market, the US$ was fluctuating at around $18 and $20 as of Wednesday.
However, on the positive side, the country’s trade deficit for the month of July narrowed to US$57,5 million after recording a 24,9 percent growth in its exports to $299,5 million for the month of July 2019 up from exports of $239,8 million in June 2019.
In June, the trade deficit was US$218,8 million. By close of Wednesday trade, at 209,95 points, the ZSE Top 10 Index was the hardest hit falling 4 percent dragging the market into the red.
The primary indicator, the ZSE All Share Index retreated 2,22 percent to 228,19 points on losses across the board while the Industrials Index went down 2,4 percent to 760,33 points.
The Mining Index was the only indicator to close in the positive after adding a hefty 10,9 percent to 308,6 points as it extended year to date gains to 35 percent.
This was on the back of gains in RioZim up 17 percent to $2,57.
Total market value went down 2,5 percent to $29,8 billion compared to $30,6 billion recorded last week on the back of losses across the market.
Regional cement maker, PPC led the fallers for the week after declining 26 percent to $3,10 from prior week’s $4,24.
Brick making firm, Willdale gave up 13 percent of value to close pegged at 3,97 cents. The duo of Innscor and Turnall lost 9 percent each to close the week at $2,79 and 10 cents respectively.
Second biggest counter by market capitalisation, Econet backtracked 7 percent to $1,69. The mobile network operator announced an upward review of its data and SMS bundles in line with the rising costs experienced across the economy.
Both Cassava and Simbisa went down 6 percent $1,48 and $1,38 in that order. At $3,69, the market’s top cap counter- Delta was 2,5 percent down while Old Mutual also went down by the same margin to $33. The insurance giant has been forced to table an improved voluntary retrenchment package to its employees after the first one got a lukewarm response.
The market was not short of gainers as MedTech put on 38 percent to close 0,72 percent to while Ariston was 23 percent above prior week to settle at 10,52 cents. Property firm, Mash Holdings added 20 percent of value to 6,98 cents.
At 2,4 cents, clothing retailer, Truworths was 18 percent above prior week.
Other gains were recorded in ZPI which also put on 17 percent to 3,52 while TSL rose 13 percent to 74,96 cents.
Also on the upside was Powerspeed which rose 14 percent to 32,1 cents while Dawn and Art added 13 percent to 8,5 cents and 6 percent to 15 cents in that order.
The market’s most expensive stock, BAT, remained flat at $50 while CBZH, Fidelity and Getbucks also stagnated at 66 cents, 8,5 cents and 12 cents respectively.
RTG, Unifreight and Zimpapers also maintained prior week levels of 11,5 cents, 10,15 cents and 9,6 respectively.
