Suppressed sentiments across the capital markets

Published: 13 December 2013

The week saw the industrial index continue to perform bearish, improvements may only be anticipated after the budget presentation as the forecast economic performance is uncertain.

Speculators are of the view that many companies may be forced to close operations in the coming year if the liquidity constraints prevail.

However some analysts forecast that the stable macroeconomic conditions, political stability and the clarity on the indigenization policy may attract foreign interests in some sectors and enhance the inflow of capital in the coming year as the year has seen interests from Brazil, Canada, France Iran and others.

The industrial index opened the week in the red dropping 1.58 points to close at 209.59 points during a trading session. The drop was mainly contributed by negative trades from the cement company PPC, Delta, Fidelity Life and Meikles. Activity remained confined to the heavyweight counters with Econet pooling in more than $2.5 million in the first day of the week session.

Continued economic anxiety persistently held the market at ransom.

The Wednesday turnover struggeled to make it across the $ 1 million mark at $1.042 million, with over 86 percent of it coming from deals in Econet and Innscor.

Selected heavyweights dragged the mainstream Industrial index to a further retreat after it dropped 0.63 points at 208.29 points. Delta lost 0.34 at 146 cents while Econet shed 1.6 percent at 62 cents as Old Mutual dropped 0.37 percent at 270 cents.

Falgold recorded the biggest retreat after shedding off 14 percent to anchor at 6 cents and consequently dragging the Mining Index further down to trade at 43.77 points to bring the year to date loss to 33 percent.

Yesterday the Bearish trend continued to echo suppressed sentiment across the capital markets as the mainstream Industrial Index recorded its fifth consecutive loss after shedding a further 0.58 percent to anchor at 207.09 points.

The FBC 52 Week range analysis shows that the Industrial Index has gained 42 percent to November 2013 after closing the month at 214 points.

Foreign contribution for the 11 Months to November has increased by 11 percent to 59 percent from 48 percent in the same period last year. As the year ends, marginal movement is expected as portfolios realign their Equity positions in line with 2014 strategy.

Zimplow's block deal in of over $1.3 million lifted turnover to $1.85 million in a session that saw 27 counters exchange hands.

Weighing down on the index were minor retreats in Delta and Innscor along with other light weight counters.
- bh24

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