ZSE closes week soft

Business
The industrial index closed the week lower on Friday at 101,67 points, indicating the growing challenges that the economy is facing.

The industrial index closed the week lower on Friday at 101,67 points, indicating the growing challenges that the economy is facing.

Our Staff

The industrial index had closed the previous week on 103,04 points.

ZSE

The mining index was flat at 19,53 points on Friday.

An equities analyst said he expected the economic headwinds to continue mounting in 2016 and to impact negatively on the upside potential of the Zimbabwe Stock Exchange (ZSE).

“Economic theory stipulates that there is a strong positive correlation between stock market performance and economic growth and since there is no economic stimuli in sight, activity on the ZSE will continue to be depressed,” he said.

The performance of a stock exchange is closely followed by investors who use it to gauge the state of the economy.

Government has rolled out a number of measures to boost trade on the bourse. On Thursday, Central Bank chief John Mangudya said a foreign investor was now permitted to buy shares in a counter on ZSE up to 15% from the previous 10% as a measure to enhance market liquidity.

Mangudya also raised foreign investors’ overall ownership in a listed company to 49% from 40%.

Foreign investors are the key players on ZSE, accounting for more than 50% of the trade.