African Thoughts: June 27, 2015


It was a slightly better week in terms of activity, but still nothing to write home about as turnover increased to $118m (+15.87%) thanks mostly to a large book over done in Zenith on Tuesday (ca. $65m). There was also a small bit of activity (mostly block trading) in GTB and Nestle. Banking stocks came under some pressure with the sector falling -1.65% thanks to ETI (-10.00%) and Unity Bank (-6.56%). Consumers (+0.42%) managed to close in positive territory with good performances in 7UP (+7.18%), Dangote Sugar (+5.08%) and Dangote Flour (4.92%). There were a few companies releasing results last week with the likes of Flour Mills (FY-15), FBNH (H1-15) and Diamond Bank (H1-15) all releasing numbers. The Monetary Policy Committee held the benchmark rate at 13% last week.


The market came under some serious pressure, albeit on low volumes, as the NSE 20 Index fell -3.0% on local selling while foreigners were net buyers. The likes of Carbacid (-17.4%), Uchumi (-16.1%) and Britam (-15.1%) were major drags on the market. Another negative was the drop in activity as turnover fell -53.5% to $28.6m with foreigners (70.6%) dominated proceedings. Safcom ($1.5m) saw the largest net foreign inflows as foreigners looked to take advantage of the recent fall. EABL managed to gain +1.8% ahead of FY 2015 results which are due out on the 31st of July 2015. KNCB will be releasing H1 2015 results on the 30th of July 2015.


Another rather dull week in Harare from an activity point of view as turnover fell -31.56% to $3.47m as Econet was the biggest contributor towards value traded (35%) while there was also a small bit of activity in Delta, BAT and Innscor. The market managed to close the week in positive territory as the Industrial Index gained +1.68%, despite Delta's disappointing Q1 trading update. There were good performances in market heavyweights Seedco (+3.60%), Delta (+3.36%), Econet (+2.50%) and innscor (+2.02%).


The market closed slightly higher with the Semdex gaining +0.2%, trimming the YTD loss to -5.8%. It was a relatively slow week from an activity point of view as turnover amounted to $6.8m as most of the activity was centered on MCBG, LUX and SBM which together accounted for 69% of total value traded for the week. The two major banks managed to close the week higher as MCBG gained +3.0% while SBMH gained +1.1%. The hotel sector had a rather rough time last week as NMH fell -4.4%, SUN shed -2.6% while LUX closed unchanged.

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