eBusiness Weekly
Mamvura’s Market Minute
January on the ZSE has ended with trades totalling $34,71 million. At first this may appear to be a reasonable amount following on from the record 2017.
Yes, it is the biggest in recent years, but January has proven to be a good month in the past due to corporate deals.
January 2018, was the fourth best since dollarisation, being slightly behind January 2013 ($36,75 million), January 2012 ($55,79 million) and the record holder January 2014 ($63,97 million).
Driving the value of trades in 2012 was the Moxon family rearrangement in Meikles with the formation of Gondor, and the Seed Co-Limagrain deal in 2014.
However, the Industrials index lost 6,35 percent over the month and was the second worst on record, beaten only by January 2016, which posted the second worst turnover for January, which was beaten only by last January.
We had started 2017 thinking that the ZSE would record a deficit again, only for the post Command Agriculture liquidity to totally change the outcome for the year.
Outside observers would find the fall in January 2018 odd given the new regime thrust, but as we in the market know, market capitalisations were inflated considerably in the last quarter of 2017 with all the liquidity floating about.
Is there any conclusion to draw from this? Well no.
But we did discover after hyperinflation that throughout the period the market was very good at reflecting the real value of the equities market and broadly it averaged $4 billion.
If all goes according to plan and we get balance of payments support (ie the RTGS/Nostro mismatch goes a good way towards balancing — “payment problems” become a thing of the past), we may see the market fall by as much as quarter in 2018 — which won’t make sense to anyone that does not understand it.
