eBusiness Weekly
Enacy Mapakame
Stocks continued on a downward trend for the fourth consecutive week as the nation awaited announcement of the Reserve Bank of Zimbabwe’s (RBZ) Monetary Policy Statement.
On Wednesday, RBZ Governor Dr John Mangudya released the long awaited MPS themed “Establishment of an Interbank Foreign Exchange Market to Restore Competitiveness,” in which he floated the rate between the US dollar and Real Time Gross Settlement (RTGS), bond notes and electronic money in a move that is expected to drop or stabilise prices.
The black market exchange rates in the last quarter of 2018 triggered sharp increases in the prices of goods and services, swelling inflation rates to record levels since dollarisation of the economy in February 2009.
Dr Mangudya denominated the existing RTGS balances, other electronic money and bond notes and coins in circulation as RTGS dollars to establish an exchange rate between current balances and forex.
On the equities market, all benchmark indices closed pointing southwards. The primary indicator, ZSE All Share Index dropped 0,43 percent to 152,25 points from previous week’s 152,9 points.
The ZSE Top 10 Index eased 0,89 percent to 150,24 points as the market’s heavy cap counters succumbed to waning demand.
The Industrials Index dropped 0,43 percent to 507,85 points compared to 510,02 points recorded in the prior week.
On the resources side, the Mining Index dropped 0,13 percent to 217,63 points. In his MPS, Dr Mangudya said gold producers will continue to surrender 45 percent of their foreign currency earnings to the RBZ, which now also applies to small scale producers who previously retained 70 percent.
Total market value eased a marginal 0,52 percent to $20,21 billion from $20,31 billion in the previous week on losses across board.
The market was weighed down by losses in property firm Mashonaland Holdings that lost 19,25 percent to 3,23 cents followed by clothing retailer, Edgars that eased 14,93 percent to 12,65 cents.
Seed producer, SeedCo International retreated 12,5 percent to $1,75 from previous week’s $2. At $1,80, industrial giant, Innscor was 10,44 percent below prior week level.
Property firm, Dawn closed the week at 2,5 cents representing a 9,75 percent decline.
Other losses were recorded in Zimpapers that backtracked 4,44 percent to 8,6 cents while telecoms giant Econet fell 1,72 percent to $1,46 as it remains the biggest company by market capitalisation commanding 18,71 percent of the entire market’s value followed by Cassava and Delta at 18,59 percent and 18,27 percent respectively.
The telecoms giant saw the ZSE in record trades in Tuesday session after a block of 81 053 746 shares went through at a bargain price of $1,49 while its fintech business, Cassava also had a block of 66 million shares at $1,47. The two companies recorded a total value of $219 million.
During the week under review, Cassava fell 0,45 percent to $1,45 while Hippo and SeedCo fell 0,55 percent to $1,75 and 1,08 percent to $1,97 respectively.
Further losses were offset by gains in brick molding firm, Willdale that put on 20 percent to close settled at 1,44 cents while FMP rose 17,19 percent to 7,5 cents.
At 81 cents, TSL was 15,71 percent above prior week levels while Meikles put on 6,73 percent 55,5 cents.
Masimba wrapped up the week’s top risers after it ticked 6,25 percent to 8,5 cents.
Other gains were recorded in retail giant, OK that put on 3,7 percent to 28 cents. Beverages maker, Delta rose 3,07 percent to close pegged at $2,91 while regional cement producer PPC rose 1,06 percent to settle at $1,90.
At $1,06, Padenga was 0,95 percent above prior week while Natfoods rose a marginal 0,14 percent to $7,16.
On the resources side, Bindura retreated 0,47 percent to 8,56 cents, weighing down the resources index. RioZim remained flat at $1,85 while the other two resource counters- Falgold and Hwange remain suspended.
ZPI, Turnall and Proplastics remained flat at 3,2 cents, 5,5 cents and 21 cents respectively. also maintaining prior week levels were Nampak, Fidelity Life and BAT that closed at 30 cents, 10 cents and $33 respectively.
Afdis, African Sun, Ariston and Axia also remained flat at $1,56, 15 cents, 2,88 cents and 11,81 cents in that order.
