HARARE, Zimbabwe – The Zimbabwean Stock Exchange (ZSE) continues to experience a remarkable rally, driven by the newfound stability of the country’s latest currency, the Zimbabwe Gold (ZiG).
The All Share Index (ASI) surged by an impressive 6.07%, while the Top 10 Index saw a substantial gain of 6.87%. Heavyweight stocks such as Delta Corporation and Ecocash recorded double-digit gains, reflecting growing investor confidence.
The introduction of the ZiG in April has been a game-changer for Zimbabwe’s economy, aiming to curb exchange rate volatility, control inflation, and restore macro-economic stability.
The currency is backed by precious minerals, primarily gold, and foreign currency reserves. Currently, Zimbabwe holds 2.5 tonnes of gold and US$300 million in cash reserves to support the ZiG. Of these reserves, 1.5 tonnes of gold are stored at the Reserve Bank of Zimbabwe (RBZ) vaults, while the remaining tonne is held offshore.
Stock market analysts have attributed the recent rally to the stability brought about by the ZiG.
Rufaro Hozheri, a well-known Zimbabwean stock market analyst, commented, “The introduction of the ZiG has instilled a sense of stability and confidence in the market. Investors are feeling more secure, and this is reflected in the substantial gains we’re seeing across the board.”
Delta Corporation, a major player in Zimbabwe’s beverages industry, saw its shares rise significantly. Ecocash Holdings, the country’s leading mobile money service provider, also recorded double-digit gains, further boosting the Top 10 Index. These gains highlight the market’s positive response to the stability of the ZiG.
However, not all stocks enjoyed the upward momentum. Financial services company First Mutual Properties (FMP) and brick manufacturer Willdale were the only two stocks to close in the negative. Despite this, the overall market sentiment remains overwhelmingly positive.
Another analyst, Tapiwa Nyatanga, remarked, “The market rally is a direct reflection of the confidence investors have in the ZiG and the broader economic reforms. The ZiG has provided a much-needed anchor for our economy, and as long as this stability continues, we can expect sustained growth in the stock market.”
The gains on the ZSE are a welcome development for Zimbabwe’s economy, which has faced numerous challenges over the past years, including hyperinflation and currency instability. The ZiG’s stability appears to be addressing these issues, fostering a more predictable and secure economic environment.
Investor confidence is further bolstered by the government’s commitment to supporting the new currency. The Reserve Bank of Zimbabwe has been actively involved in managing the currency’s reserves and ensuring its stability. This proactive approach has been crucial in maintaining the positive trajectory of the ZSE.
The rally on the ZSE has not gone unnoticed by international investors either. There is growing interest from foreign investors looking to capitalize on the stability and growth potential of Zimbabwe’s stock market. This influx of foreign investment is expected to provide additional momentum to the market.
Overall, the Zimbabwean stock market is experiencing a period of unprecedented growth and stability, thanks in large part to the introduction of the ZiG. As Rufaro Hozheri aptly put it, “Good times on the ZSE indeed!” Investors and analysts alike are optimistic about the future, with the hope that the current rally is just the beginning of a long-term trend of economic stability and growth for Zimbabwe.
For more updates and detailed analysis on the Zimbabwean stock market, stay tuned to ZSE News.
