Choppy heavy cap trading weighs on ZSE

HARARE-  Trading on the Zimbabwe Stock Exchange has generally remained firm with strong demand characterising trading over a period of 3 months to date.

The average value of daily trades over the last 3 months stands at $8 million a session which dwarfs prior year averages by a huge margin.

In the mid-week session, the top 3 counters on the exchange however came off and these are Econet, Delta and Cassava, resulting in a weaker broader market outturn. The 3 counters’ losses overturned gains in 15 counters as market breadth remained positive.

Effectively the stock market curtailed a 7-day rally over which it had gained 15.5% cumulatively which deduces to an average of 2.2% gain per session. The strong performance is largely derived from risk aversion as investors seek comfort in stocks.

The cash shortages, spiking prices and weakening exchange rates are catalysing the growth in strong market demand which is believed to be safe haven in period of macroeconomic volatility.

Analysts at Equity Axis expect demand for stocks on the ZSE to remain firm despite the volatility in heavy caps. The volatility in heavy caps is viewed as speculative and tapping from profit taking and buying on dips as investors strategically play the market.




Respect Gwenzi

Respect is the Lead Analyst and Managing Director at Equity Axis. He has 8 years experience in respective fields of finance and media. Particular areas of expertise include Asset Management, Stockbroking and Financial Media. Respect is on a mission to change the course of Financial Media in Africa through digitalization

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