African Thoughts: February 08, 2016

Nigeria:

It was a better week in terms of activity in Lagos, but still nothing to write home about as turnover increased +33.16% to $63.21m. There were a few crosses in select names but nothing really too exciting. It is however worth noting that there were two off-market crosses in Zenith on Friday, one for 120m shares at N11.00 and the second for 90m shares at N11.00. The market closed the week lower with the ASI falling -1.73% thanks mostly to consumers as the sector fell -3.17% with big losses in Unilever (-13.90%), Nestle (-5.00%) and NB (-3.96%). Banks also closed the week slightly lower with the index falling -0.67% thanks to GTB (-4.76%) and Access (-1.93%). On the economic front, The Federal Inland Revenue Service projected a revenue target of N4.95tn for the 2016 fiscal period. Unfortunately we expect the trend of lack of interest from global investors to continue for the short term as they are more concerned with what is going on in the developed world.

Kenya:

The market managed to close higher for the second week in a row thanks to foreign investor demand with the NSE 20 Index closing +1.6% higher. There were strong moves in heavyweights Safcom (+6.9%), KNCB (+4.6%), EABL (+3.0%) and EQBNK (+1.3%). There was a slowdown in activity with turnover falling -14.7% to $33.07m with foreigners being net buyers for the second week in a row to the tune of $11.68m (the highest in 4.5 months). KNCB was the most active name for the week and accounted for 30.2% of activity with foreign inflows of $3.68m while EABL had the second highest foreign inflows ($3.3m). The National Treasury has targeted a budget deficit of 6.9% in 2016/17. Inflation for January fell to 7.78%.

Zimbabwe:

It was another poor week from a performance point of view in Harare as the disastrous start to 2016 continues, with the Industrial Index falling -1.33%, taking the YTD loss to -11.48%. There were losses in heavyweights Innscor (-4.59%), Econet (-4.01%) and NatFoods (-2.62%). Another negative was the drop in activity as turnover fell -46.98% to $1.72m with Delta (51%) accounting for the majority of activity. The one positive was the announcement that foreign ownership holding limits on ZSE listed stocks had been increased from 40% to 49% and individual holdings were also increased to 15%.

Mauritius:

Mauritius continues to buck the global trend with the Semdex closing +0.8% higher for the week, taking the YTD gain to +2.6%. The move higher was thanks to the likes of SBMH (6.1%), NMH (+2.6%) and MCBG (+1.8%). Activity was relatively average with total turnover amounting to $6.1m, which was largely geared towards MCBG with the name accounting for 53.6% of activity. One negative was that foreigners were net sellers to the tune of $970k.