Staff Writer 
ZIMBABWE’s stock markets have got on to a slow start in 2025 with trading activity so far being sluggish due to a combination of sustained liquidity challenges and the general cautiousness by investors.
The country’s primary bourse- the Zimbabwe Stock Exchange (ZSE) has been the major loser while the US-dollar denominated Victoria Falls Stock Exchange (VFEX) has performed relatively better albeit on marginal gains.
At the close of trading on Friday January 10, 2025, the ZSE All share index had lost 4,2 percent since the start of the year settling at 208,36 points from 217,58 points on December 31, 2024.
In addition, the ZSE had lost over ZiG3 billion in market capitalization, closing at ZiG62 925 200 618,05.
On the other hand, the VFEX market capitalization as at January 10, 2025, had gained US$9,8 million since the start of the year.
Analysts have expressed cautious optimism on the prospects of the local stock markets stressing the need for improved policy support to consolidate meaningful growth.
“While it remains the dominant exchange (ZSE), its performance is increasingly driven by inflationary trends and local speculative activity rather than fundamental growth. Policy consistency and improved forex liquidity could sustain gains in 2025,” FBC Securities said in its 2025 outlook report.
“VFEX has potential for growth if macroeconomic conditions stabilize and international investment inflows improve.
Overall, policies that boost profit margins and cash flows for formal businesses will increase investable funds available directly to those firms, and indirectly to pension funds.”
Last year the VFEX All Share index added 4,08 points to close December 2024 at 104.08 with the number of trades totaling 12,529 from January to December 2024, with an average of 1,044 per month.
Market Capitalization growth was mainly due to the addition of new counters and the improved liquidity of the USD.
The VFEX witnessed the listing of Edgars Stores and Invictus Energy Depository Receipts last year in addition to the launch of Contract For Differences (CFDs) in May 2024.
“However, while VFEX attracted additional listings, overall trading volumes remained modest due to limited liquidity and subdued foreign investor activity.
“High country risk perception and limited international capital inflows constrained VFEX’s growth potential,” FBC Securities said.
With regards to ZSE’s performance last year, FBC Securities said, “Forex shortages and high transaction costs discouraged foreign investors, who remained largely absent from the market.
Small-cap companies struggled due to weak earnings, tightening regulatory requirements, and constrained growth prospects.”
Authorities have insisted on tight liquidity conditions this year to continuously contain exchange rate movements and inflation.
Critics say this will adversely impact on companies’ performance and stock market activity this year insisting on improved cash injection into the economy.
Meanwhile, the ZSE has reviewed indices for the first quarter of this year to improve tracking of market performance.
The Top 10 Index comprises British American Tobacco, CBZ Holdings, Delta Corporation, Econet Wireless, Ecocash Holdings, FBC Holdings, First Mutual Holdings, Hippo Valley, Mashonaland Holdings and Rainbow Tourism Group.
NMB, SeedCo, Tigere Property, ZB Financial Holdings and First Mutual Properties make the five additions to the Top 10 to complete the Top 15 index. By Kudzanai Gerede
Companies and Markets Editor
