The Sunday Mail
THE Zimbabwe Stock Exchange (ZSE) gained the most in three months as investors “cherry picked” stocks in an oversold market. By close of trade on Thursday, the ZSE’s mainstream industrial index had risen 8 percent since May 21 at 184,86 points.
Heavyweights and mid-tier stocks led the recovery.
Telecommunications giant Econet gained 13 percent as the market cheered the launch of EcoCash Diaspora in partnership with international money concern WorldRemit.
Beverages manufacturer Delta Corporation also added 7 percent, while British America Tobacco rose 22,5 percent on news the tobacco processor was not going to exit from Zimbabwe.
Hippo Valley climbed 33 percent as stockbrokers urged shareholders to hold on to the company’s shares despite recent depressed results. The firm’s top line declined 22 percent for the year ended March 31 2014 as cheap imports flooded the market.
Lower sugar prices realised from exports into the European Union also took their toll.
Industrial giants Old Mutual, Innscor, National Foods and Pretoria Portland Cement have jumped between 4 percent and 15 percent in the past month.
Similarly, the mining index has been on an upward trajectory in the review period spurred by gains in nickel producer Bindura Nickel Corporation. The miner, which announces its annual results on June 30 2014, has since advised the market that its second-half profits are likely to be higher than the US$3 million reported in the first half.
The mining index, made up of four counters — Falgold, Hwange, RioZim and Bindura — has doubled in value in the past three weeks, closing at 57,78 points on Thursday.
After struggling for most of the first half, minings are now up 96 percent on a year-to-date basis.
Bindura shares have soared above 100 percent in the past fortnight to US4,61 cents.
On Thursday, Bindura rose 9,5 percent.
While activity by foreign buyers slackened in May as investors bought US$21,8 million worth of stocks, a 32 percent decline from a month earlier, market watchers expect foreign buys to be relatively higher this month.
The return of foreign capital into emerging and frontier markets is being helped by improvements in major European economies.
There are, however, other fundamentals pushing stocks higher.
Analysts say the renewed focus on policy issues may have been contributing to the local bourse’s performance.
“. . . May saw renewed focus on policy issues, with clear signs that the country has reached an inflection point where the economy is beginning to take the forefront.
“Government announced that it is in the process of reviewing the indigenisation and empowerment policy to facilitate sector specific implementation, to be followed by the necessary amendments to the Indigenisation (and Empowerment) Act,” said stockbrokers IH Securities in a recent report.
There is recognition that investors must be able to recover their capital investment and attain proper return on investment, the stockbrokers added. “We believe that if Government advances this process in a clear and transparent manner, it could herald a positive catalyst for the economy going forward.”
But some analysts maintain a bearish outlook for the equities market, arguing that the obtaining liquidity crunch will continue to affect the corporate world.
Investor Diary
26 June — Pioneer 44th Annual General Meeting of Shareholders, Venue: Pioneer Corporation Africa Limited Boardroom, Corner Hood/Hermes roads, Southerton, Harare, Time: 1000 hours
26 June — Masimba Holdings Limited Thirty-Ninth Annual General Meeting of Members for the period ended 31 December 2013 Place: 44 Tilbury Road, Willowvale, Harare, Zimbabwe, Time: 1200hours
30 June — TA Holdings 79th Annual General Meeting of the ordinary members
Venue: Miti Room, Sango Conference Centre, Cresta Lodge, Harare, Time: 1400 hours
30 June — ZIMRE 16th Annual General Meeting of members, Venue: Nicoz Diamond Auditorium, 7th Floor Insurance Centre, 30 Samora Machel Avenue, Time: 1230 hours
30 June — Hwange Colliery Company Limited Ninety First (91st) Annual General Meeting (AGM) of Shareholders,
Place: 7th Floor, Coal House, 17 Nelson Mandela Avenue, Harare, Time: 1030 hours
30 June — MedTech Holdings Fifteenth Annual General Meeting of the members,
Venue : MedTech Holdings Boardroom, Stand 619, Corner Shumba/Hacha roads, Ruwa, Time: 1500 hours.
30 June — TA Holdings Limited 79th Annual General Meeting of the ordinary members,
Venue: Miti Room, Sango Conference Centre, Cresta Lodge, Harare, Time: 1400 hours.
