A bullish sentiment prevailed on the Zimbabwe Stock Exchange (ZSE), which saw all indices closing the week in the positive.
Since beginning of the year, stocks have enjoyed a fine run on the back of firming demand as local currency continued to depreciate on the illegal parallel market.
Despite implementing reforms in 2019 meant to restore confidence in the economy and make foreign currency more accessible on the official interbank market, the country is still battling foreign currency shortages that has a knock effect on businesses.
Only those businesses with foreign currency exposure have a lesser burden and have been tipped to stand the economic turbulence brought by forex challenges, inflationary pressures and erratic utilities supplies.
During the week to Wednesday, the primary indicator, the ZSE All Share Index, closed 13 percent stronger to 317,12 points while the market’s heavily capitalised stocks, the ZSE Top 10 Index put on 12 percent of value to 284 points. At 285 points, the ZSE Top 15 Index was 13 percent above prior week’s 251 points. The Medium Cap paced the fastest with a 17 percent jump to 383,25 points while the Small Cap added four percent to 838,21 points.
Total market value advanced 13 percent to close the week at $41 billion from $36 billion recorded in the prior week.
Seed Co headlined gains for the week with a 59 percent jump to $2,99 after reporting sales volumes for both the third quarter and nine months period to December 31, 2019, went down as the market continued to battle an array of economic challenges such as waning disposable incomes together with unfavourable weather forecasts.
During the third quarter, volumes fell three percent while for the nine months the decline was 24 percent compared to same period in the prior year.
Also gaining by 59 percent was Axia, which closed the week pegged at $1,19 while cables maker, CAFCA put on 44 percent to $2,88. The duo of clothing retailers, Edgars and Truworths rose by 43 percent each to settle at 31,05 cents and 2,73 cents respectively completing the top five risers.
Other significant gains were recorded in insurance group, FML that put on 38 percent of value to close at 43,2 cents.
Spirits and wines maker, Afdis advanced 33 percent to $4 from previous week’s $3 while retail giant OK Zimbabwe and NMB rose 36 percent to $1,18 and 35 percent to 50 cents. Padenga put 30 percent to $4,20.
The duo of NatFoods and Simbisa ticked 27 percent each to $12,75 and $2,02 in that order.
The market’s biggest stock by capitalisation, Delta, added 12 percent to $4,50.
The market was, however, not short of fallers. Only listed brick making firm, Willdale led the bears after it went down 28 percent to 3,7 cents. TSL retreated 20 percent to close at 80 cents. The diversified group announced the appointment of Derek Odotoye as its new chief executive officer, replacing Patrick Davenish who held the position since May 2018.
Diversified financial services group, Old Mutual eased eight percent to close at $40 while largest media group, Zimpapers backtracked six percent to 30 cents completing the week’s only four fallers.
Art and Fidelity remained unchanged at 12,3 cents and 9,22 cents respectively. Also remaining flat were Powerspeed, Turnall, Unifreight and Falgold which closed pegged at 29,4 cents, 11,4 cents, 9 cents and 3 cents in that order. Stocks are projected to continue on a growth trajectory fuelled by inflationary pressures as investors pump excess liquidity into the bourse.
Without a clear and immediate solution to challenges experienced in 2019 that drove inflation, the same economic hardships experienced last year are anticipated to continue.