Stock market ignores Kasukuwere threats — analysts

The decline in prices at the Zimbabwe Stock Exchange was in line with trends on the international market not the indigenisation ultimatum issued by Indigenisation and Economic Empowerment minister Saviour Kasukuwere, analysts said.

A Harare-based analyst said the share price of Barclays Bank, one of the banks that was given a 14-day ultimatum by the government, had been on a decline path since June.

He said the share price as of June 22 was at 6,68 cents, while yesterday it traded at 5,7 cents.

British American Tobacco, the other company that was given a seven-day ultimatum by Kasukuwere to comply or risk losing its licence, had its share price rising to 115 cents from 110 cents on Tuesday.

“I think the market treated the threats as empty threats. The consensus is that the sentiments are negative. The indices are going down due to the unavailability of foreign buyers as a result of what is happening on the international market,” he said.

Another local analyst said the market was not responding to the threats as they had been there since 2009.

Meanwhile in Johannesburg, Aquarius Platinum Ltd, the fourth-largest producer of the metal, declined by 14% on Monday, the biggest intraday slump since July 2010, and closed down 6% at R27,27 rand by 5pm.

Mimosa received a letter from Kasukuwere rejecting the company’s indigenisation plan and asking the company to submit a revised proposal by the end of August.

“The majority of the concerns are probably largely priced in. There isn’t going to be a speedy resolution given the divided nature of the government in Zimbabwe,” Edward Sterck, an analyst at Bank of Montreal told Bloomberg.

“Given the number of companies they need to have dialogue with, it’s not going to be a quick one and I don’t think the government is putting forward suggestions on how this will be achieved,” he added.

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