Published by the government of Zimbabwe
7 August 2008
Harare — ZIMBABWE Stock Exchange shares rose the most in three days yesterday after fractional gains in heavyweight counters and other lightweights but volume remained thin.
Yesterday, the sell off in second liner shares persisted, and the hawkish outlook that the Zimbabwe Stock Exchange had adopted over the past months fizzled out.
At the close of trade yesterday, the main index was up 10 percent or 1 428.7 points to 15 845.39 points halting huge losses posted on Monday and Tuesday.
Minings pushed higher 7,1 percent to 17 110.08 points after gains in RioZim offset losses in all other counters but Halogen and Hwange.
Volume remained thin with 4,7 million shares worth around $2 billion changing hands. ZSE market capitalisation moved marginally to nearly US$3,3 billion from nearly US$3,7 billion two weeks earlier.
The main index lost 20 percent of its value on Tuesday, and was down 22 percent at week opening, as investors pocketed profits from an earlier rally.
On Monday, the resource index slumped 37,1 percent and lost 13,7 percent on Tuesday. Over the year, the main index is up more than 8 million percent while minings have grown by 7,2 million percent since January.
Over the past few days, there has been a reasonable flight of capital from the stock market to the foreign currency market where the cash rate has doubled to $2 000 per US dollar.
Yet, other punters have been taking positions in lightweight stocks on the ZSE, whose prices have fallen sharply with the bear market.
Investors are more concerned about the inflation outlook, which has been the biggest driver for the stock market in the last five years.
Zimbabwe's annual inflation rose to 2,2 million percent at the end of June. There is concern the figure could climb higher on rising food and service prices.
Investors are betting on weak inflation forecasts, and moving funds into equities as inflation hedge.
Of the index shares yesterday, hotel group RTG led movers rising 100 percent after the group said it was introducing two loyalty cards, Sethule and Pachedu, aimed at increasing market share.
Starafricacorporation doubled it price to $6 followed by KMAL which gained 88 percent. Econet rose 79 percent after saying subscriber base had hit 1 million from 650 000 and TA Holdings ended 78 percent stronger.
Of the ZSE shares, Art ZDR paced decliners falling 40 percent. Barclays and NTS fell by similar margins. Seed Co lost 36 percent while Pearl Properties shed 33 percent to $2.
In minings, Rio Zim gained $40 to $220 while losses were reported Bindura and Falgold that closed weaker $4 and $1 in that order.
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