Stock Market Weekly Review

09 Apr, 2021 - 00:04 0 Views
Stock Market Weekly Review

eBusiness Weekly

After last week’s attempt to rally towards previous record levels, the Zimbabwe Stock Exchange’s market capitalisation stumbled this week and closed 4.1 percent lower $509.9 billion.

Market watchers believe the ZSE is going through a market correction given the preceding rallies in the previous two quarters.

The bourse recorded losses across the board with more pronounced losses being recorded among the ZSE Top 15 counters.

By the close of trading for the week to Wednesday 7 April 2021, the ZSE Top 15 Index was the biggest loser down 3.70 percent to 2,867.82.

Small Cap stocks were a bit resilient losing just 0.72 percent, while the ZSE Top 10 Index eased 3.34 percent to 2,523.29.

Struggling miner Rio Zimbabwe was the week’s biggest loser down 14.54 percent. The company released its financial results to December 2020 showing a 27 percent drop in gold production to 1.21tons from 1.66tons achieved in the prior year. 

The miner blamed the decline on low grade ore from its One Step Mine. Gold production at Dalny Mine also declined by 46 percent in the current year to 198kgs due to major breakdowns in the milling section of its ageing plant which directly impacted milled output.

Clothing retailer Edgars Stores also lost 14.18 percent to 300.39 cents. The company’s last set of results for the full year to January 10,2021 showed a 17 percent drop in turnover on depressed volumes. Units sold for the year to date declined to 2,4 million from 3,4 million last year.  

Crocodile breeder, Padenga Holdings Limited was the third biggest loser down 13.95 percent to 2549.97 cents. In March, the company warned of a significant fall in profitability for the year to December 31, 2020 relative to prior year due to the negative effects of the COVID-19.

The market was however not short of risers with Nampak leading the gainers up 13.18 percent to 850 cents. 

In its last trading update released in February, Nampak said the three month period from 1 October 2020 to 31 December 2020 was marked by an increase in volumes for all the Group’s entities, “an indication that the overall trading environment had benefited from the easing of the lockdown compared to the previous quarters”.

Revenue in historical terms for the first quarter was 411 percent ahead of prior year, as a result of improved sales volumes, greater availability of raw materials and inflationary pricing.

ZimRe Holdings (ZHL), which is currently the least performer on the ZSE with a year to date loss of 26.63 percent was the week’s second top riser, up 11.23 percent to 230 cents. ZHL recently acquired a a controlling block in Fidelity Life Assurance Company Limited.

NMB came third among risers, up 10.52 percent to 918.18 cents. 

In its year end results to December 2020, NMB reported a profit before taxation of $705 million (2019 – $691 million) and this gave rise to total comprehensive income of $1 billion. The Group achieved a basic earnings per share of 210.12 cents up from 96.49 cents prior year comparative.

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