Published: 27 August 2013

THE Zimbabwe Stock Exchange is forecast to reach the $6,2 billion mark in terms of market capitalisation by 2014, provided there is sustained economic development and greater fiscal prudence, a local advisory and securities firm has projected.

FBC Securities, in a report titled Zimbabwe - post-election synopsis, said with a stable government in place, sustained economic development was a distinct possibility and was forecasting a target market capitalisation of $6,2 billion next year - implying an upside potential of 27% on current levels.

The local bourse exhibited a bullish streak in the first half of the year due to sustained movement in heavily capitalised counters. As a result, market capitalisation for the period breached the $5 billion point mark recorded at $5,4 billion which the securities firm said reflected improved market sentiment in the first half of the year.

FBC Securities, however, said there were downside risks largely beholden to the empowerment and indigenisation thrust, with the major concern being an essential side-way movement of major indices in the post-election era.

FBC Securities said the stock market losses in the post-election period are perception-driven despite immaterial changes in the core macroeconomic fundamentals. The firm, however, said with a stable government in place, sustained economic development was a distinct possibility.
- southerneye

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