ZSE slows as investors wait

HARARE - Growing uncertainty characterises trade on the Zimbabwe Stock Exchange, prompting the financial markets to remain largely directionless as investors adopt a 'wait and see' attitude in the wake of  government-imposed price slashes.
Analysts forecast the reduced investor sentimen

t – which has been worsened by the absence of a monetary policy review, owing to the postponement of the mid-term review by Zimbabwe’s central bank – would persist.
“The price slash directive by the Government has dealt a major blow to investors as some listed companies have reported restocking problems due to difficulties in sourcing the stocks from suppliers.
“Also, given that the mid-term monetary policy review has been postponed, the outlook now depends on the policy issues that will be articulated in the supplementary budget expected to be announced soon,” said Kingdom Stockbrokers.
The Finance Minister will announce its supplementary budget at a date yet to be given.
Reflecting on the uncertainty trend, the key industrial index tumbled by about five percent during the past week to close at 32 909 293.59 points.
“Given the current hyperinflationary environment characterized by monthly inflation rates of at least 50%, returns on the money market are negative. This, coupled with the continued weakness on the equities market – a rare phenomenon as the two markets normally have an inverse relationship – has left investors with no option but to keep their assets in cash form for speculative reasons and in foreign currency for importing basic goods which are currently in short supply in Zimbabwe,” said a ZSE stockbroker. – CAJ News

Post published in: Economy

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