African Thoughts: February 20, 2017

Nigeria:

Every day and every week feels like Groundhog day in Lagos these days, and last week was no different. The ASI drifted aimlessly lower on very thin trading yet again. The ASI closed down 69bps with both the banks (-44bps) and consumers (-4.63%) closing lower. The main losers in the banks were Stanbic (-5.90%, N16.75), Diamond Bank (-5.75%, N0.82) and FCMB (-2.99%, N1.30) with Zenith Bank (-2.91%, N15.00) and Access Bank (-1.73%, N6.82) also weak. The major fallers in the consumers included UACN (-4.97%, N14.35), NB (-8.00%, N115.00), Guinness (-6.23%, N60.95) and Nestle (-3.91%, N599.99) which were partially offset by a 21.29% jump in PZ to N13.39. In economic news the National Bureau of Statistics released January inflation figures which saw inflation rise from 18.55% in Dec16 to 18.72% in Jan17.

Kenya:

It was a fairly average week on the activity front in Kenya as turnover fell 33% to $26.9m with the highlight being some action in Safcom on Wednesday as 45.4m shares changed hands as the telco came under some pressure from foreign sellers, closing the week down 2.43% at KES18.05. The market closed the week slightly lower with the NSE 20 Index softening by 0.10%. It was a mixed bag in the banking sector with KNCB taking some serious strain and closing 3.92% lower at KES 24.50 while EQBNK inched higher to KES27.25. However, both names saw tiny volumes over the week. There was some average activity in EABL this week with foreign sellers pushing the brewer 0.44% lower to KES224.00.

Zimbabwe:

The lack of interest from foreign investors in the Zimbabwean market continued this week with the market seeing very average turnover of $2.4m with no large crosses worth mentioning. The market also continued to come under pressure with the Industrial Index closing the week 1.73% softer (now down 5.23% YTD). The main reasons for this softness included Econet (-15%, 17c) and Delta (-3.90%, 82c). The Reserve Bank of Zimbabwe has announced a series of measures anchored on four pillars which the bank believes will ultimately stimulate the national economy and solve the currency challenges. These 4 pillars include institutional discipline, financial inclusion, financial integrity (which is hoped to stimulate domestic output and productivity necessary to increase jobs and exports) and ensure monetary and financial sector stability.

Mauritius:

In Port Louis, the Semdex rose by another 1.71% to reach an impressive +6.53% YTD. A large portion of this can be attributed to MCBG which rose to an all-time high of Rs227.00 (+90bps) while also witnessing some decent volumes. MCBG released 2017 H1 results during the week which showed a 10.8% increase in attributable profits which encouraged foreign buying in the group. SBMH tagged along for the ride and rose by 30bps to Rs7.02 also seeing decent volumes. NMH (-70bps, Rs21.00) released 2017 Q1 results during the week.