The ZSE once again outperformed regional stock markets in real terms, with returns of 123% (using the real effective rate); followed by the Zambian stock exchange, up 97% y/y.
African stock markets closed the year on a positive note reflecting optimism about a global rebound from the pandemic and increased demand for commodities.
Quantitative easing by central banks that lowered interest rates, made equities attractive, while liquidity from stimulus packages found its way to stock markets.
Market capitalisation closed 123% up in real terms, from US$2.7bn in December 2020 to close 2021 at US$6.1bn.
The All-Share Index was up 311% for the year, against annual inflation of 60.74%. Interestingly, the Small Caps Index was up 3,280% compared to the ZSE Top 10 at 307% up y/y. Increased activity from retail investors through ZSE Direct
and C-Trade may explain the movement in Small Caps. Overall activity on the market was driven by a combination of inflation hedging and value investing given real growth in the underlying companies.
The ZSE opened the year with 56 counters and closed with 54 after the delisting of Dawn, Padenga and BNC while MedTech B joined the bourse.
By the end of 2021, CBZ had been displaced by Econet as the largest company on the ZSE by market cap.
Of concern is the continued suspension on PPC and Old Mutual. A reminder of the level of policy risk that exists on the market.
The Old Mutual Top 10 Exchange Traded Fund (RTF) closed it’s first year of trading at a price of $4.40, representing a price movement of 340%. The Morgan and Co Multi Sector ETF joined the bourse in January 2022.
