African Thoughts: April 30, 2012

Please note that due to all the markets that Securities Africa covers being closed as a result of the Workers Day Holiday on Tuesday May 1st we will be closed and can be reached on trading@securitiesafrica.com.

With world markets in rally mode last week there were some good performances across the African continent. There were however a few markets that came under a slight bit of pressure and closed the week in negative territory. Below is a list of selected bourses and their performances from last week.

Zimbabwe:

The Zimbabwean market closed the week very mixed with the Mining Index being the continent’s top performer and managing to gain a whopping 11.6% while the Industrial Index was the worst performer in Africa and fell 2.9%. The move higher in the Mining Index can be attributed to the 41% rally in Bindura after the company announced that Mwana Africa will underwrite their rights issue to raise funds ($35m) needed to finance the re-opening of the Trojan Nickel mine. Econet released full-year results last week which saw EPS increase to $1 up from $0.83 a year earlier. Murray and Roberts South Africa announced that they intend to dispose its 47% shareholding in Murray and Roberts Zimbabwe.

Egypt:

Good week in Egypt with the EGX managing to gain 1.9%, albeit on rather weak volume as investors were focused on the FT and EMOB deal. With the long awaited catalyst needed to drive the market higher, the EFSA finally approved FT's tender offer for EMOB at EGP202.5, EMOB and OTMT resumed trading after the news was announced, both names led the market in terms of volumes. It is worth noting that the Real estate sector continued to surge after taking the strongest hit in the recent sell-off.

Nigeria:

Nigeria put in a rather solid performance last week with the ASI managing to gain 1.62% driven once again by the banking sector which drove both volume and performance (Banking Index gained 1.84%). IBTCCB released Q1 2012 numbers which saw profit after tax increase to N2.5bn from N1.1bn a year earlier. Inflation figures for March released last week came in at 12.1%. The NSE signed an agreement with NASDAQ OMX platform to create an option market before 2014 and a futures market before 2016.

Mauritius:

Mauritius managed to close the week slightly higher with the Semdex gaining 0.20%. MCB was the driver behind the move higher with the name gaining 0.60% while SBM fell 0.60%. On the news front exports for the first quarter increased 2.8% from a year ago. Air Mauritius announced that they are on the brink of implementing their “7 Step – Recovery and Game Changer Plan” which is expected to decrease expenses by 10% annually.

Kenya:

There was a bit of profit taking in Kenya last week after the East African market has enjoyed a rather good run of late, the NSE 20 Index fell 0.60%. Reporting season was still well under way with a number of the big banks reporting Q1 numbers. Equity Bank released Q1 numbers which saw net profit increase by 13% to Ksh2.6bn, the name managed to gain 2.76% for the week. Kenya Commercial Bank announced that Q1 net profit increased by 36.7% to Ksh2.42bn with the name falling 5.26% for the week. East African Breweries was extremely active last week and contributed 45% towards market turnover with foreigners heavily involved on both sides of the counter.