The local bourse is still driven by foreign investors as net purchasers on the market. However, a financial analyst warned against reading too much into the foreign traffic visiting the ZSE website.
“It is more a case of hoping that the cart will pull the horse,” Takunda Mugaga said.
He added that basic economic and political fundamentals needed to be addressed. “The Government must address economic and political fundamentals to attract foreign investors. What the stock exchange is doing has already been done by the private sector,” he said. “The good news is, people from over 104 countries have visited the ZSE Data Portal in the past three weeks.”
In response to questions posed on the site, ZSE made the following statement:
“The limit for an individual foreign investor is 10 percent of total issued share capital whilst the aggregate limit per counter is 40 percent. Foreign investors may exceed these thresholds with prior approval from the Reserve Bank of Zimbabwe and the ZSE,” ZSE said. Outside investors’ participation on the bourse has been on an upward trend since 2010. Trends for the first quarter of 2013 show that the stock market rally in January and February slowed down during the month of March as foreign investor participation declined. Data from the finance ministry shows that the industrial index oscillated in March 2013, opening at 183.98 points, before firming at 190.96 points, and then softening to 185.6 points on March 22.
The mining index remained subdued, recording 84.07 points in January, slightly losing to 83.0 points and further to 63.9 points by March 22.
Consequently, total market capitalisation marginally increased from $4.751 billion at the end of February 2013 to $4.761 billion as of March 22.
Post published in: Business