ZSE sees 32 percent drop in trading

Golden Sibanda Senior Business Reporter
The Zimbabwe Stock Exchange saw a 32 percent dip in trading in the first six months of the year, as most heavyweight stocks registered declines in volumes of trading.

Statistics from the stock market show that trades on ZSE amounted to $136,72 million between January and June from $200 million in the same period last year when more people bought and sold shares.

Stock market liquidity depicts the degree to which an asset or security can be traded without affecting its price. It is characterised by a high level of trading activity.

Trading on ZSE has since dollarisation been dominated by foreign investors due to tight liquidity in the domestic economy, as Zimbabwe uses foreign currency, exclusively.

As such, foreign investors bought $73,96 million worth of shares and sold $68,79 million on ZSE between January and June.

Seed producer Seed Co recorded the single largest decline in trades in the first six months of the year at 86 percent after turning over just $6 million from $44 million in 2014.

Financial services behemoth, CBZ Holdings, registered the second biggest fall, plunging 70 percent in the period under review, after a total of $2,8 million was traded.

Also on the downward spiral was Delta Corporation, which took a 40 percent knock to $39,4 million, followed by Econet Wireless, which fell 34 percent to $33,1 million.

Not to be outdone, tobacco processor BAT Zimbabwe, joined the bandwagon of stocks that saw trades falling when only $3,3 million was traded, a 41 percent drop.

In terms of heavy weights, only Innscor defied the principle of gravity after heading 6 percent northward at $10,7 million compared to $10 million in the prior year.

Generally, the largest gain was recorded in alcoholics and spirits manufacturer, African distillers, which put a weighty 717 percent after registering $1,9 million trades.

Thus far this month, only $1,5 million trades have been recorded compared to a total of $25 million turned over for the month of July in the same period last year.

Meanwhile, the market continued to retreat in June, falling 3,22 percent to end the month a total market capitalisation of $4,15 billion.

The industrial index fell 2,98 percent to 148.40 points on the back of weakness in the heavy weight counters.

Activity remained subdued in June with falling turnover of just about $11,94 million, representing a 69,01 percent retreat while trades averaged $0,54 million.

The heavy weights trio of Innscor (25 percent), Delta (23 percent) and Econet (22 percent) accounted for the largest contribution of trades undertaken in last month of the first half.

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