Stocks recovered by 40 percent in the month of September on the back of firming demand as risk aversion set in on the back of inflationary pressures and
run-away exchange rate on the parallel market.
On the official interbank rate, local RTGS$ depreciated by 30 percent in the month under review as the central bank also tightened regulations for Bureaux de
Change to align their rates with the official interbank rate and be at 7 percent margin of interbank mid-rate.
As a result of the inflationary environment, investors rushed to stocks as a safe haven, pushing the market value ahead by $8,7 billion to $30,5 billion,
subsequently reversing losses accrued in the prior month as well as pushing year to date gains to 57 percent.
The ZSE Top 10 Index paced the fastest in the month of September with a 46,4 percent gain to 218,09 points from 148,96 achieved in the previous month.
Both the Industrials and All Share Indices each closed 40 percent firmer to 744,55 points and 323,52 points respectively on gains recorded across board.
On the resources side, the Mining Index advanced 21,4 percent to close settled at 317,75 points. During the month, gold producer – Falgold’s shares resumed
trading on the ZSE after meeting the local bourse’s requirements.
Total value of trades for September came in at $166 million representing a 56 percent growth on previous month.
This year, the market had reached its peak in June before dwindling in July and August. Statistics from the local bourse shows 45 counters enjoyed a bull run
against three fallers.
Big cap counters drove values for the month. The market’s biggest stock by total value, Delta rose 30 percent to $4,02 while Cassava ticked 36 percent to
$1,70. The fintech group was caught up in a wrangle in the past month with over 4 000 of its EcoCash agents suspended on allegations of selling cash at a
The central bank however extended the punishment with a ban on all cash-out and cash in transactions effective October 01, a decision the fintech group has
since sought recourse with courts.
At $1,86, Econet was 48 percent above the prior month while National Foods put on 25 percent to $9. Industrial conglomerate, Innscor, jumped 64 percent to
$3,06 after reporting earnings growth for the year to June 30, 2019, despite a difficult operating environment.
Cigarette manufacturer, BAT surged 66 percent to $50 maintaining its position as the most expensive stock ahead of Old Mutual which put on 42 percent to $25.
Market watchers are of the view the inflationary environment will continue in the near future and increase the attractiveness of stocks as a safe haven.–