adminof harmonised elections set for the end of this month as the market has started trading sideways. In its June monthly market snapshot equities research firm IH Securities said the month marked a subdued ending to the first half with the market cap declining.
“We believe the announcement of an election date, being July 31, 2013, or assuming an extension August 14, caused some softening with light profit taking occurring particularly in liquid names,” the equities firm said.
“Turnover fell by a significant 35,13 percent to US$25,62 million in June, after recording some improvement in May while average daily value traded declined by 28,64 percent to US$$1,28 million,” IH Securities said. Investors across the world tend to sit on the fence ahead of an election until they get an idea of the policies of the incoming Government.
“We anticipate that the market will largely trade sideways in this season as we await both the election process and outcome,” IH Securities said this week. Beverages manufacturer Delta Corporation dominated the trading accounting for more than half of the value shares traded at US$12,87 million.
Financial group FBC Holdings was a distant second in terms of shares sold coming in at US$7,49 million followed by Econet at US$5,87 million. IH Securities said despite the beginning of the interim reporting season for companies with December year ends stress in run run-rates would continue.
The equities firm cited persistent liquidity challenges for its assertion.
The market, however, reversed gains made in the prior month of May, with total market capitalisation declining 2,15 percent to close June at US$5,99 billion (plus 36, 64 percent year to date), including shares on foreign registers.
The industrial index eased 0,08 percent as all heavyweights closed the month in the red; Econet (US140c) lost 5,71 percent, whilst Delta (US66c)and Innscor (US91,02c) gave up 4,12 percent and 1,07 percent respectively.
There was mixed trading in mid-caps with OK Zimbabwe, ABC, Old Mutual and National Foods declining 18,37 percent, 16,81 percent, 10,83 percent and 9,26 percent respectively while BAT, Seed Co, and Hippo gained 21,21 percent, 12,50 percent and 1,17 percent respectively.
OK closed the month of June at US22,04c, ABC US60c, Old Mutual US214c, Natfoods US245,01 while BAT was at US1000c, Seed Co US81c and Hippo US115c.
The mining index recorded weakness, declining 0,93 percent despite gains in Hwange at US17,5c was 16,67 percent up as Bindura at US2,75c had slipped 3,85 percent while Riozim lost 10 percent to US45c.
IH Securities also said it had noted that several banks are not compliant with the June 31 minimum capital deadline of US$50 million by June 30, 2013.
The equities company contends that following agreements that have been signed between the IMF and the WB foreign investors were likely to increase their investment into the banking sector.
Online Reporter