TURNOVER on the Zimbabwe Stock Exchange (ZSE) is expected to fall to $250 million on the back of a slugging economy, the bourse has said.
BY VICTORIA MTOMBA
Last year, turnover was $452 million.
In an interview, ZSE chief executive officer, Alban Chirume said as at the end of December 10 this, month the turnover was $220,14 million.
“We are going to do less than $250 million by end of this year. We believe in 2016, the capital markets will be under pressure. Lately, there has been more foreign sellers than purchases. This is worrying because traditionally, foreign investors transactions on the market are more than 50%,” he said.
The stock exchange turnover in 2016 will be the same as 2015 and the industrial index will remain depressed, Chirume projected.
“This outlook can change if it can be demonstrated that companies can access finance,” he said.
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Chirume said the fact that foreigners are net sellers in a market that is depressed meant they are willing to take huge losses and move their money elsewhere.
“This tends to give an impression that they may not be in the market in 2016. The local investors are changing their portfolio from equities to fixed income securities since they have suffered over 29% loss on their portfolios this year,” he said.
Finance minister Patrick Chinamasa said in the 2016 National Budget statement the local bourse was depressed due to illiquid conditions and high trading costs.
He said in the interim, it was necessary that measures be instituted to lower trading costs and broaden the variety of products on the market.
