BULAWAYO - Activity on the Zimbabwe Stock Exchange (ZSE) has nosedived since a fortnight ago when Prime Minister Morgan Tsvangirais MDC party announced it was partially withdrawing from the unity government. (Pictured: The Zimbabwe Stock Exchange)Several foreign are said to have instructed stockbrokers to freeze trading until there is some clarity on the future of the unity government that raised investor hopes at its formation eight months but may yet collapse as coalition partners wrangle over power-sharing.
In a third quarter money markets report, Kingdom Stockbrokers noted that the inclusive government remained fragile and was threatened by policy differences, the slow pace of reforms and feuding over senior state jobs a scenario it said would undermine efforts to revive the economy.
The stockbroking firm said: At every turn thus far, hardliners in the transitional government have resisted moves that would undermine their historic patronage system and power structures. And for the most part, they appear to be succeeding.
In short, Zimbabwe’s transition remains a work in progress, incomplete and clouded with uncertainty. The feuding in the GNU has impacted negatively on revival of industry and building of foreign and local investor confidence.
In line with the depressed atmosphere, the industrial index opened the week last Monday on a low, shedding 2,25 points (1,32 percent) to close at 168,36 points as heavyweight counters lost ground.
Losses of the previous week on Friday and Monday had seen the stock market shed 5,2 percent with only one counter having traded.
On Tuesday last week the market lost 4,25 points (2,52 percent) to close at 164.11 points on the back of widespread losses with the only positive trade being recorded in CAPS up US0, 30c at US2c.
Analysts expect the stock market to continue in the red until a solution to the current political impasse has been found.
Post published in: Manufacturing