A week of bulls on ZSE as gains dominated

The Zimbabwe Stock Exchange (ZSE) witnessed a robust week of trading, marked by significant gains across key counters and notable developments in market dynamics for the week ending July 5, 2024.

As the week drew to a close, 28 counters surged while 6 recorded declines, underscoring a bullish sentiment among investors.

Leading the charge were prominent stocks such as CBZ, Econet and Delta, each posting impressive gains: CBZ soared by 34,85 percent, Econet climbed 21,79 percent, and Delta rose by 3,85 percent. This performance contributed to the ZSE All Share Index closing at 147.23 points, reflecting a substantial 14,45 percent increase from the previous week’s 128.64 points.

Conversely, Proplastics and OK Zimbabwe were among the few decliners, with decreases of 11,59 percent and 10,77 percent respectively.

Market turnover for the week reached ZiG 48,60 million, with Delta and Econet leading the charge with turnovers of ZWG33,4 million and ZWG11,21 million respectively. Meanwhile, the VFEX All-Share Index also saw positive movement, rising by 2,16 percent from 101.20 points to 104.91 points, buoyed by gains in National Foods and FCB.

Commenting on the market’s performance, Platinum Securities noted: “The week saw a notable uptick in trading activity driven by strong demand in blue-chip stocks such as Delta and Econet. The reduction in Capital Gains Tax on marketable securities from 4 percent to 2 percent provided a significant incentive, bolstering investor sentiment and contributing to the overall market momentum.”

Looking ahead, market analysts anticipate continued firmness in trading, particularly driven by sustained interest in key stocks.

However, activity on the VFEX is expected to remain subdued due to limited investor participation in USD-denominated assets and low foreign investor involvement.

The Reserve Bank of Zimbabwe’s recent increase in mineral reserves backing the Zimbabwe Gold (ZiG) currency from US$285 million to US$370 million is also expected to support price and exchange rate stability, potentially curbing inflationary pressures in ZiG terms.

Overall, the ZSE’s performance reflects a cautiously optimistic outlook, supported by strategic policy adjustments and robust investor interest in select equities.-ebusinessweekly