Tight liquidity bites ZSE, as VFEX faces slower trading post-ZiG devaluation

Tapiwanashe Mangwiro

Platinum Securities has projected that the Zimbabwe Stock Exchange (ZSE) will face continued pressure in the coming weeks, with lower trading volumes following the Central Bank’s recent devaluation of the ZiG.

In their weekly review, the brokerage firm noted that liquidity remains tight, causing investors to remain cautious.

On the Victoria Falls Exchange (VFEX), they expect subdued trading activity, as USD-denominated assets dominate the market and foreign investor participation stays minimal.

Despite these challenges, the ZSE closed the week with gains, driven by positive performance across key indices.

“We expect the stock market to remain under pressure, with lower trading volumes following the recent official devaluation of the ZiG by the Central Bank. Liquidity remains tight and investors are likely to remain cautious,” Platinum Securities commented in their weekly review.

On the Victoria Falls Exchange (VFEX), the brokerage firm added, trading activity is expected to remain subdued as USD – denominated assets compete for attention and foreign investor participation remains low.

The Zimbabwe Stock Exchange (ZSE) All-Share Index ended the week on a positive note, closing 1,33 percent higher compared to the previous week. The ZSE Top 10 and ZSE Top 15 Indices also saw gains of 2,41 percent and 1,98 percent, respectively, driven by 15 counters that finished the week in the green, compared to 13 that posted losses.

Notable risers included EcoCash, which surged by 30,02 percent to ZiGc 41.61, and FML, which gained 12,78 percent to close at ZiGc 450. Econet also saw an 8,48 percent rise, ending the week at ZiGc 379.68.

Total market turnover for the week stood at ZiG 61,80 million, with Delta and Econet driving the bulk of the trades, contributing ZiG 30,3 million and ZiG 16,4 million, respectively.

In the Exchange Traded Funds (ETFs) segment, all except the Datvest Modified Consumer Staples ETF recorded gains. The Morgan & Co Made in Zim ETF was the standout performer, with a remarkable 6839 percent weekly rise.

However, on the VFEX, the All-Share Index declined by 0,51 percent, from 104.96 points to 104.42 points, largely due to losses in 8 of the 15 listed counters. Zimplow led the gains, closing the week 11,02 percent higher at USc 1.31.

In corporate news, African Sun, a VFEX-listed hospitality company, announced the termination of its pending sales of the Great Zimbabwe Hotel and Beitbridge Express Hotel, valued at US$4,45 million and US$2,5 million, respectively.