As the US dollar increasingly became scarce, local investors feared the return hyperinflation, precipitating the scramble for equities.
The bull-run lasted for a whole year.
“Market turnover will however remain depressed as witnessed in the past days, due to few buyers as investors wait for the market correction to continue. Rational investors don’t buy when the market is going down, so we are likely to see higher turnover either after the self correction or if it happens that the bullrun resumes – maybe when the so called ‘good news’ turn out to be bad,” said another equities analyst.
The heavyweights, Delta and Econet lost 58.88 percent and 52.52 percent in the last 8 days to 132.23 cents and 88.68 cents. However in a year to date, Delta and Econet have gained 49.41 percent and 195.6 percent respectively.
BAT, Innscor and National Foods dropped 7.5 percent, 33.81 percent and 10.96 percent to 3 700 cents, 111.92 cents and 650 cents in that order.
Padenga and Seedco shed 32.79 percent and 54.32 percent to 54.43 cents and 147.08 cents respectively while Simbisa and Hippo Valley dropped 20.3 percent and 3.68 percent to settle 54 cents and 170 cents.
Old Mutual, which is trading at a premium relative to its primary listing on London Stock Exchange (LSE), has so far lost 68 percent to 457.55 cents. However, in the year to date Old Mutual has gained 31 percent. In the same period, OK Zimbabwe shed 46 percent to 14.05 cents.
Analysts also say foreign investor sentiment is expected to improve in the short-term.
“We are likely to see a renewed interest from foreign investors in the medium term when the dust settles down. We need foreign inflows from portfolio investments just like we need foreign direct investment in our country,” an analyst said.
Disposing of penny stocks will be a mammoth task. These include counters such as Medtech, General Beltings and Zeco whose share prices has risen during the bullrun era but have very poor fundamentals.
Struggling miners, Falcon and Hwange have also seen their share prices grow by 266.7 percent and 26.7 percent.
“Those holding penny stocks will find it difficult to dispose of their shares and take advantage of the profit taking as the market pulls back, due to their lack of liquidity,” said an analyst. – The Source