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Bruce Ndlovu, Sunday News Reporter
THE Zimbabwe Stock Exchange (ZSE) is set to start trading again, with Old Mutual PLC, Seedco International and PPC the only stocks that will remain suspended on resumption on 3 August.
Last month, Government suspended all trading on the ZSE in a bid to curtail unethical practice in the financial sector which it believed was fueling black market activity.
In a statement announcing the return of trafe on the local bourse, the Minister of Finance and Economic Development Professor Mthuli Ncube said while there was no evidence unearthed of the direct involvement of the three entities in driving black market rates, the Old Mutual Implied Rate (OMIR) had become the default benchmark being used by market players.
“Whilst there was no observed evidence of the direct involvement of the listed entities themselves, significant evidence of a strong link between the price behavior, and transaction patterns on internationally-listed shares, namely Old Mutual PLC, Seedco International and PPX, and the behaviour of the parallel market exchange rate was also established, with varying degrees of causality.
“In particular, Old Mutual Implied Rate – OMIR), was observed to be the key driver of parallel rate pricing behaviour, with many market games players in the real economy using this highly visible rate as a benchmark for forward pricing and costing of goods and services, as well as determination of foreign exchange rates in the market,” he said.
Consultation on the return of the three were still ongoing, Prof Ncube said.
“However, the three internationally listed stocks, namely Old Mutual PLC, Seedco International and PPC remain suspended from trading on the local bourse for the time being, whilst further consultations continue on the best way forward regarding their re-listing, under suitable rules. The public will he updated periodically on the progress.”
Online Reporter