ZSE Market Commentary 11 Mach 2024
The ZSE All Share Index opened the new week on a positive note, wholly recouping prior session’s losses to close at a 1-week high as investors chase value-preservation amid the heightening hyperinflation. The mainstream ZSE All Share Index surged by 2.73% in early week trades to close at a 1-week high of 520,465.3 points. The positive performance was evenly spun between market heavies and medium caps while penny stocks sailed stable. Overall year-to-date gains stretched to 146.9% in nominal terms, while the US$ YTD loss position closed at -11% amid a heightened exchange rate depreciation on interbank market. The bourse closed the month of February at a nominal loss of -3.16% in nominal terms, and -34% in US$ terms. The ZSE has slipped from being the best performing bourse in Africa on a year-to-date US$ return basis to 12th position.
The US$ denominated bourse, VFEX, opened the new week in positive territory, partially countering prior session’s losses as activity substantially improved amid anticipated improved liquidity with the expected added listing of Edgars. The mainstream VFEX All Share Index firmed by a mild 0.33% to close at 96.36 points. The All Share Index was rebased to 100 at the end of 2023 following the addition of six new listings in 2023. Today’s positive outturn was driven by the duo of First Capital Limited and Innscor which outweighed sell-offs in 2 counters. Overall year-to-date losses trimmed to -3.6% while on a month-to-date basis the bourse has shed off -2.3% barely 2-weeks into the month. An aggregate of US$139,579 exchanged hands in today’s session, substantially up from US$29,640 traded in the prior session.
On the currency markets, a recent tightening of the money supply has resulted in reduced activity on the parallel currency market, allowing the interbank exchange rate to close in on the gap. The exchange premium has shrunk from 86% in January to a circa 30%. Meanwhile, the Auction market remains suspended since December 2023 as the government seeks to revise the operational model in a bid to stabilize exchange rates. However, at the close of the most recent auction trading week, the ZWL shed off -0.65% against the US$ on the Auction market to close at ZWL5,827.8 per US$. On the interbank market, the ZWL depreciated by -1.82 against the US$ today to close at ZWL16,878.37.
An aggregate of 27 counters exchanged hands in today’s session, with 7 sailing stable while 14 emerged risers. Turnall came out as the top performer in the session on rising 55.3% to settle at 6500c, extending the positive streak to a 3rd straight session while CAFCA buttressed prior session’s gains by a further 15% to close at 1163800c. Unifreight firmed by 14.82% to settle at 48800c, followed by Meikles which rose for a 3rd consecutive session by a further 14.39% to close at 350028.43c. ZHL buttressed prior session’s gains by a further 10.58% to close at 29314.29c, capping off the Top 5 risers’ set.
On the downside, a total of 6 counters partially weighed on the market. Hippo performed the worst in the session on plummeting -14.99% to close at 397398.04c, extending the negative trend to a 4th straight session while Edgars fell for a 3rd consecutive session by a further -11.17% to settle at 35000c. ARTD lost ground by -3.23% to close at 21000c, trailed by Nampak which reversed prior session’s gains on dipping -1.71% to settle at 46080.46c. EcoCash Holdings extended prior session’s losses by a further -0.01% to close at 58790.12c, capping off the Top 5 laggards’ pack.
Total turnover rose by 480% from prior session’s record to ZWL16,112 today against a 175% increase in overall shares traded. Delta led turnover contributors in the session, contributing 59% of the aggregate turnover and was trailed by Econet, OK Zim, Masimba and AFDIS in that respective order. Overall foreign outflows contributed 27% to aggregate turnover in the session while inflows held a foothold of 26%.
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