The Zimbabwe Stock Exchange (ZSE) has raised the market-wide trading halt (circuit breaker) threshold for index movement on the ZSE All Share Index from plus or minus 10 percent to plus or minus 15 percent starting today in line with individual securities threshold.
The ZSE has seen its stocks continue to rally as investors seek a safe-haven for fast depreciating Zimbabwe dollar currency prompting the bourse to introduce circuit breakers to cool off the market.
In a stock market, a circuit breaker refers to an emergency-use regulatory measure that temporarily halts trading on an exchange. It the case of the ZSE, it is being used to limit the extend equities are rallying due to massive Zimbabwe dollar balances being dumped as investors seek to store value.
“The Zimbabwe Stock Exchange Limited (“ZSE”) would like to notify all stakeholders of the following operational changes effective 12 June 2023: i. The ZSE will change the market wide trading halt threshold from ±10% to ±15% for index movement on the ZSE All Share Index,” said the ZSE in a statement.
“This is in line with Rule 4.13.1 of the ZSE Trading procedures. ii. The ZSE circuit breakers for individual securities will remain at ±15%. The above changes have been necessitated to align the index halt thresholds with the individual securities movement. The ZSE will also continue to review its operations in line with market developments.”
Last week alone the ZSE initiated circuit breakers three times to allow the market to cool off.
