African Thoughts: July 04, 2016

Nigeria:

With all the attention still firmly focused on the E.U. and the U.K. it was a very dull week in Lagos as activity slowed -35.38% with turnover falling to $60.88m. There were a few decent crosses in the likes of GTB, Zenith and NB over the course of the week, but nothing to write home about. The market came under a fair amount of pressure with the ASI falling -4.39%. Banking stocks were the hardest hit with the sector falling -5.38% with heavy losses in Zenith (-8.24%), Stanbic (-7.35%), ETI (-7.29%), UBA (-5.92%) and GTB (-3.93%). Consumers did not fair to much better with the sector closing -5.07% lower thanks to losses in NB (-9.59%), Guinness (-6.11%), Cadbury (-3.61%) and Nestle (-0.54%). On the positive side; the market closed the first half of the year with a gain of +3.3%. The Federal Government is planning to borrow between N305bn and N395bn ($1.08bn-$1.40bn) in local currency denominated bonds with maturities ranging from 5 to 20 years in the third quarter of this year. Unfortunately with the market closed on Tuesday and Wednesday for the Eid celebrations, we expect another dire week from an activity point of view.

Kenya:

The market closed lower for the second straight week with the NSSE 20 Index falling -1.4%, taking the YTD loss to -9.6% as foreign investors were net sellers to the tune of $1.9m. Another negative was that activity was very dull as turnover fell -12.6% to $33m. Safcom was the only name worth mentioning from an activity point of view as the telco accounted for 32.2% of activity, while the name recorded the highest net foreign outflows ($1.6m). On the positive side, EQBNK managed to close +1.3% higher on foreign buying as the name had the highest net foreign inflows ($1.8m). EABL was amongst the worst performers as the brewer fell -4.2% on foreign selling while KNCB also had a torrid time, closing -2.2% lower. The Kenya National Bureau of Statistics released Q1 2016 GDP numbers which saw growth of +5.9% y/y thanks to growth in accommodation and food services (+12%), Agriculture, forestry and fishing (+4.8%), transport and storage (+8.4%) and mining and quarrying (+6.9%). Please note that the market will be closed on Thursday due to the Eid celebrations.

Zimbabwe:

It was a very pleasing week from a performance point of view in Harare as the Industrial Index managed to close +3.87% higher, trimming the YTD loss to -11.91%. Delta was the main driver behind the market's performance with the name closing +13.03% higher. On the negative side, it was a woeful week from an activity point of view as turnover fell -70.18% to $1.53m with SeedCo (25%), Old Mutual (18%), Delta (18%) and Econet (10%) driving proceedings.

Mauritius:

It was a sub-par week from an activity point of view in Port Louis as turnover amounted to $4.93m with MCBG and SBMH together accounting for 50% of total value traded. The market closed the week slightly lower with the Semdex falling -0.21(YTD -3.2%). Banking stocks closed the week in negative territory with SBMH falling -1.6% while MCBG closed -0.5% lower. Hoteliers finished the week mixed with NMH falling -1.0% while SUN closed +1.5% higher. Please note that the market will be closed either on Wednesday or Thursday, depending on the visibility of the moon.