Online Reporter
Nelson Gahadza
ZIMBABWE’S equities market was marked by contrasting performances in August, with the Zimbabwe Stock Exchange (ZSE) recording a sharp increase in turnover driven by a significant block transaction in CBZ, while the Victoria Falls Stock Exchange (VFEX) experienced softer trading activity and increased foreign selling.
The ZSE equities turnover more than quintupled during the month to ZiG2,83 billion from ZiG530,57 million in July, representing a 433,6 percent increase, market statistics obtained from the bourse show.
According to the ZSE statistics, the substantial rise in turnover was accompanied by an 87,6 percent increase in the volume of shares traded, from 76,61 million in July to 143,76 million.
However, the surge in activity did not translate into broad-based gains, with the ZSE’s benchmark indices closing lower.
The All-Share Index declined by 0,7 percent, from 480,81 points to 477,39 points, while the Top 10 Index fell by 1,4 percent, from 486,86 points to 480,09 points.
The Mining Index provided some support, gaining 15,3 percent to 169,11 points from 146,68 points. IH Securities described the August performance as a pause in the ZSE’s 2026 rally rather than a reversal, with weakness in heavyweight counters weighing on the major indices, while retail-driven buying supported smaller counters, exchange-traded funds (ETFs) and real estate investment trusts.
The brokerage firm said trading on the ZSE was dominated by a major block transaction in CBZ involving the Public Service Pension Fund (PSPF). CBZ recorded ZiG2,67 billion in value traded, with ZiG2,58 billion arising from a single transaction involving 62,3 million shares at ZiG39,99 each. The transaction saw the PSPF acquire an 11,91 percent stake, taking its holding in the banking group to 21,67 percent.
At approximately US$100 million, the transaction dwarfed other activity on the ZSE and accounted for most of the market’s monthly turnover, highlighting the continued concentration of liquidity in large block trades.
According to the statistics, the sharp rise in turnover was, therefore, not accompanied by broader market participation.
The number of trades fell by 17,2 percent to 2 087 from 2 521 in July, reinforcing the view that August’s higher market value was largely driven by sizeable transactions rather than a broad increase in trading activity.
Foreign participation remained a drag on the ZSE, as foreign purchases by value fell by 32,2 percent to ZiG59,45 million, while foreign sales increased by 7 percent to ZiG119,86 million. This resulted in net foreign selling of about ZiG60,4 million, compared with ZiG24,3 million in July. In volume terms, foreign investors bought 12,59 million shares, up from 9,73 million, while sales increased to 14,98 million shares from 12,66 million, leaving a net foreign outflow of about 2,39 million shares.
During the month under review, ZSE market capitalisation also eased, declining by 0,8 percent to ZiG106,88 billion from ZiG107,71 billion in July.
IH Securities put the month-end figure at ZiG105,19 billion, representing a 0,87 percent decline, and leaving the market 13,41 percent higher year-to-date.
Among individual counters, ZSE Holdings was the strongest performer, surging by 114,81 percent in nominal terms. Willdale followed, gaining 40 percent, supported by stronger earnings and improved operating performance. On the other hand, the VFEX presented a different picture, with trading activity weakening despite a substantial increase in market capitalisation following the listing of Old Mutual. VFEX equities turnover declined by 3,2 percent to US$13,74 million from US$14,20 million in July, while volumes fell by 17,7 percent to 26,11 million shares from 31,73 million. The number of trades declined by 10 percent to 3 239 from 3 600.
The weaker activity was accompanied by a 1,7 percent decline in the VFEX All-Share Index to 258,9 points from 263,5 points.
In the month under review, the VFEX recorded a slightly sharper monthly decline of 1,75 percent, with the index closing at 258,90 points. IH Securities said the decline demonstrated that the substantial increase in market value had not been matched by broad-based price appreciation. During the month under review, VFEX market capitalisation nearly doubled in August, rising by 95,7 percent to US$8,07 billion from US$4,12 billion in July.
IH Securities put the increase at 95,15 percent, taking the exchange’s year-to-date growth to 263,04 percent. The sharp increase was largely attributable to the listing of Old Mutual on August 12, rather than to widespread gains across the market.
Old Mutual quickly became a significant contributor to trading activity, recording US$1,89 million in value traded during the month. IH Securities ranked it third among the exchange’s largest value contributors, behind Padenga at US$2,79 million and Caledonia at US$2,55 million. In volume terms, 2,17 million Old Mutual shares changed hands, placing the counter third behind Econet InfraCo, with 6,65 million shares, and Seed Co International, with 3,72 million.
IH Securities said the immediate trading activity following the listing demonstrated pent-up demand for quality US dollar-denominated securities and strengthened the case for the VFEX as the preferred market for large, dual-listed and hard-currency counters.
“In our view, the Old Mutual listing is a strong endorsement of the VFEX as the natural home for large, dual-listed and hard-currency counters,” the brokerage firm said.
However, IH Securities cautioned that the decline in the All-Share Index showed that broader price performance remained soft, while liquidity continued to be concentrated in a handful of counters. During the month under review, Seed Co International was the strongest-performing VFEX counter, gaining 27,32 percent to US36 cents, as investors responded positively to the group’s earnings performance.
Zimplow rose by 11,55 percent to US11,40 cents, while FCB advanced 6,91 percent to US15 cents, amid continued interest in counters with improving financial performance.
The contrasting performance of the two exchanges came against a relatively stable economic backdrop, according to IH Securities.
It said ZiG (Zimbabwe Gold) maintained its value against the US dollar, with the interbank rate closing at ZiG26,68 to the US dollar, compared with ZiG26,68 at the end of July.
Annual ZiG inflation eased to 2,9 percent from 3,2 percent in July, while monthly ZiG inflation remained at 0,1 percent.
US dollar-denominated monthly inflation fell to zero from 0,3 percent.
