The market capitalisation for Zimbabwe's Stock Exchange (ZSE) fell 11 percent to $4 billion in the first half of this year as foreign investors sold shares and the economy stagnated, data from the bourse showed on Thursday.
Foreigners bought shares worth 70 million US dollars in the six months to end-June compared with 133 million US dollars during the same period last year, accounting for 52.5 percent of trading on the exchange versus 70 percent a year ago.
Zimbabwe's government says the economy is expected to flatline this year as a result of low global commodity prices which will impact mining production, low foreign direct investment and company closures as a result of power shortages and expensive finance.
The bourse's main industrial index fell to 148.40 points from 164.90 points in January as companies reported weak earnings due to depressed domestic demand, power shortages, high interest rates and competition from cheaper imports.
"The underperformance could reflect fatigue on the average risk-averse investor as the economy continues to underperform," stockbroker MMC Capital said in a research note.
Data showed that overall foreign investor interest had declined, with preference for shares in large consumer-oriented firms such as mobile phone service provider Econet Wireless, brewer SABMiller's local unit Delta and food retailer Innscor, which were seen as being well managed and had an expanding consumer base.
The ZSE, which has 61 listed companies, is expected to begin live electronic trading on Friday as the bourse seeks to cut red tape and attract more investors.