On Tuesday, the Zimbabwe Stock Exchange closed in the red zone as investors profited from recent gains.
The market rerouted south amid concerns of depressed activity on the local bourse occasioned by continued constraints in RTGS liquidity.
“Month on month, the market shed off 12.2% in nominal terms to a MCap of $1.64 trillion whilst the local currency depreciated 5.6% on the parallel market versus a -3.59% movement on the auction,” advisory firm, Inter Horizon Securities (IH) said in its latest monthly snapshot.
“As a result, the stock market in real terms lost 16.9% to close the month of November at US$1.94 billion, trending below the 5-year average market cap of US$4 billion. Average daily value traded for the month of November fell from an equivalent of US$0.55 million in October, down to US$0.43 million.”
Total volumes traded were also down 55.2% to 90.8 million.
“Notably, smaller denomination gold coins were introduced within the period to the investing public further providing alternative asset classes to the ZSE,” it said.
IH stated that the market is nevertheless appealing at the current levels, trading at a significant discount to fair value despite underlying business growth over the previous three years and themes of rising corporate transactions.
“Whilst trading updates covering the period June- October pointed to softening volume in official channels due to lack of ZWL liquidity, portion of sales done in USD has however been steadily increasing as the country dollarizes providing a hedge to earnings against an inflationary environment.”
It expects the local bourse to stay sluggish in the near future as long as the government keeps a tight handle on liquidity.
“With evident buying opportunities we recommend selective buying into counters with strong industry positioning and a culture of management execution and prioritizing long-term shareholder value creation,” it said.
At close, the mainstream ZSE All Share lost 0.45% to close at 14,778.48 points. Market breadth was negative, as 14 losers were reported compared to 8 gainers.
The Top 10 Index was off 0.83% to end at 8,658.72 points on Econet which garnered 0.43% to finish at $73.74.
On the flip side, BAT and CBZ shed 3.54% and 3.16% to end at $2990.00 and $124.00 respectively. Innscor eased 0.67% to finish at $345.80.
Axia led gainers, appreciating by 1.87% to close at $64.19 after the board approved the delisting of the company from the ZSE, immediately followed by its listing on the Victoria Falls Stock Exchange.
“We believe that the steady increase in USD sales for listed companies will sustain the trend in ZSE listed companies migrating to the VFEX,” IH said.
First Capital grew 1.22% to end the day at $9.98. SeedCo Limited went up by 0.07% to $75.35. Tanganda rose to $80.50, notching up 0.04% in the process.
On the other hand, NMB shed 3.23% to end today’s trade at $30.00. Mash Holdings fell to $17.14, losing 4.57% in the process.
Market turnover declined by 73.05% to $269 million. Transactions in the shares of Delta topped the activity chart with 528,900 shares worth $129.58 million.
Market capitalisation was down 0.45% to $1.65 trillion.
The Datvest ETF gained 0.02% to $1.68, while the Morgan & Co Made In Zimbabwe rose 0.63% to $1.3887. Others remained flat.
Tigere REIT recovered 0.15% to $33.5507 – Harare