ZSE performance depressed

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ACTIVITY on the Zimbabwe Stock Exchange (ZSE) continues to be depressed due to the poor performance of the economy characterised by serious liquidity constraints.

BY VICTORIA MTOMBA

Official statistics show that the industrial and mining indices went down during the month of April while the turnover increased.

The industrial index has been on a downward trend after opening the year at 164,90 points in January. It went down to 167,16 points in February, 158,22 points in March and it closed the month of April at 156,26 points.

Companies that are listed on the ZSE published their financial statements and most of the companies were bemoaning the business operating environment which is difficult as well as the unavailability of working capital due to liquidity constraints.

The Confederation of Zimbabwe Industries shows that most firms are operating at below 40% capacity utilisation which makes it difficult for companies to make good profits as they are not utilising the full capacity they have.

A local analyst said: “Nothing much has changed on the local bourse between March and April.Companies published their financial results and it was not all rosy.”

The performance off the mining counters that include Bindura, Falgold, Hwange and Rio Zim in April was low as the index declined during the month of April. The resources index closed the month of April at 42,93 points from 43, 93 points in March. Bindura Nickel Corporation has been a major drive of the mining index since last year, but the other three counters have been affected by the environment and have been registering poor performances.

The index since the beginning of the year has been on a decline path. The mining index opened the year at 58,13 points and in February it went down to 55,38 points.

Turnover stood at $29 million from $18 million March.