Zimbabwe stocks slide 21% after resumption as foreigners flee

0
184

Zimbabwe stocks slide 21% after resumption as foreigners flee

Zimbabwe’s benchmark stock index has slid by 21% since the government allowed trading to resume just over two weeks ago, with traders attributing the slump to foreign investors cutting their holdings.

Zimbabwe stocks slide 21% after resumption as foreigners flee

The Zimbabwe Industrial Index had surged almost 700% in 2020 before trading was halted on June 26 by authorities who blamed dealing in stocks for contributing to a plunge in the local currency.

The government said shares of Old Mutual Ltd., PPC Ltd. and Seedco Ltd., which have listings outside the country, were being used to manipulate foreign-exchange rates. They remain suspended.

The slump since the Harare exchange’s Aug. 3 resumption is “driven particularly by foreign selling post the market suspension,” said Lloyd Mlotshwa, head of equities at Harare-based IH Securities, coupled with low liquidity.

“There’s very little currency locally to absorb the stocks, so prices inevitably get hammered.”

Foreigners have sold Z$208 million ($2.5 million) worth of stocks since the bourse reopened, according to data provided Tuesday by the Zimbabwe Stock Exchange.

LEAVE A REPLY

Please enter your comment!
Please enter your name here