Investors on the Malawi Stock Exchange (MSE) held on to their shares between July and September, witnessed by a 65.63 percent decrease in share volumes traded during the period.
The development resulted in a 32.98 percent decrease in share value traded during the third quarter of the year.
This is according to the Third Quarter Market Performance Report published by MSE on Wednesday.
However, the report shows that the market registered a positive return on index as reflected in the upward movement of the Malawi All Share Index (Masi) from 35144.56 points registered on July 1 to 41550.15 points on September 30 2021.
This translates into a return on index of 18.23 percent compared to 6.58 percent recorded in the third quarter of 2020.
In an interview Thursday, Alliance Stockbrokers Operations Manager Thokozani Saulosi said, considering the current economic situation embedded with the effects of the Covid pandemic and uncertainty in the economy, the market has performed above expectation.
He said despite the reduction in value and volume traded, prices in several counters have increased due to half-year results and expectation from the companies which led to an increase in Masi.
“In the last quarter of the year, we expect the market to perform much better considering that, in the last quarter, investors are eager to restructure their portfolios,” Saulosi said.
MSE Operations Manager Kelline Kanyangala concurred with Saulosi, saying reasons for share price increases in the counters that triggered such a performance varie among the firms but for some it is a reflection of trading statements released as well as improved business prospects for other entities.
“Trading activity in the quarter was subdued partly due to the impact of the third wave, where new infections rose significantly in July.
“Looking ahead, we are hopeful that the market will close better than it did last year. Currently, the year-to-date return stands at 28.27 percent which is above inflation. That is good for investors,” Kanyangala said.
The market transacted a total of 189,419,282 shares at a total consideration ofK8, 301,397,301.65 in 975 trades.
In the corresponding period of 2020, the market transacted a total of 551,047,767 shares at a total consideration of K12, 385,612,653.56 in 923 trades.