• Sun. May 26th, 2024

FBC Securities says cautious sentiment will prevail among stock investors

ByEconomic Times

Jul 11, 2023

…as ZSE starts the week negative

The Zimbabwe Stock Exchange ended Monday’s trading session in negative territory.

Today’s performance comes as the mainstream ZSE ALL Share Index, which tracks all stocks listed on the exchange, saw a gain of 779% from June 1 to June 30.

FBC Securities said in its latest first half of 2023 review and outlook report that it expects local economic events, especially governmental interventions that may have an impact on liquidity circumstances and company performance, to continue to have a significant impact on the local bourse.

“Ahead of the 2023 general elections, we expect a cautious sentiment to prevail among investors as they continue to assess the impact of the elections on business. Historically, election periods have been marred by economic volatility and bouts of violence, which may dampen investor confidence,” FBC Securities said in its latest first half of 2023 review and outlook report.

The research firm indicated that the ZSE’s performance is still influenced by the local money supply.   

“As liquidity increases, funds are directed to the stock market, boosting performance. While elections have generally been characterized by increased money supply as election related government expenditure rises, the local economy is faced with a unique challenge as authorities continue to target inflation and exchange rate volatility through liquidity tightening measures.

“Loosening the grip on money supply may have a destabilizing effect on the economy, increasing inflationary pressures and exchange rate volatility,” it said.

At the close of trades, the ZSE All Share Index lost 2.10% to close at 152,053.02 points. Eleven companies recorded price losses on Monday, with Truworths falling the most as it lost 12.50% to close at $10.50.

The gainers’ chart, which consisted of 13 gainers, was led by CAFCA with a 14.99% increase, closing at $3320.06.

Losses in Delta saw the Top 10 Index fall 3.51% to end at 75,798.71 points.

Market capitalisation declined 1.22% to $12.29 trillion.

Turnover for the day fell 23.75% to $2.52 billion.

Transactions in the shares of Delta topped the activity chart with 861,300 shares valued at $2.24 billion – Harare

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