African Thoughts: June 02, 2014

Nigeria:

The shortened trading week was not enough to stop the surge in turnover with activity increasing 45.56% to $212.8m. A large contributing factor to the increase in activity was the rebalancing of the MSCI Frontier Market Index (increased to 31%) with ETI and Forte Oil now being included in the Index for the first time. The market had a phenomenal week from a performance point of view with the ASI gaining +5.31% lead higher by banking stocks with the bank index gaining +7.49%. Star performances in the banking sector came in the form of tier-1 stocks ETI (+11.04%), FBNH (+10.07%) and Access (+8.60%). Consumers also managed to close the week in positive territory with the index gaining +0.71% thanks to UACN (+12.07%) and Flour Mills (+8.72%).

Kenya:

It was also a very solid week in Nairobi from an activity point of view with turnover increasing 42.4% to record the most active week YTD ($72.93m) as net foreign inflow was also the highest for the year ($25.4m), as KNCB saw the highest net inflows ($17.8m). The market unfortunately closed the week lower with the NSE 20 Index falling -0.9% with Liberty Insurance (-12.7%) being a major drag on the market. EQBNK gained 5.0% as the bank met with stakeholders at the start of the week to share plans of the proposed roll out of products using its Mobile Virtual Network Operator (MVNO) license. EABL gained 1.4% despite the regulator proposing closure of retail outlets located within residential areas. Foreign direct investment increased to $3.64bn in 2013 according to the Kenya Investment Authority.

Zimbabwe:

The market managed to close the week on the front foot with the Industrial Index gaining +1.44% on the news of a possible review of the indigenization and empowerment regulations. Big cap stocks NatFoods( +4.48%), Econet (+3.06%), Seedco (+2.8%) and Delta (+2%) helped drive the market higher. Activity however fell 38.19% to $6.36m for the week on the back of a fall in foreign participation and a shortened trading week. Delta (61%) completely dominated turnover with some action in the likes of African Sun and CBZ.

Mauritius :

The market managed to close slightly higher with the Semdex gaining +0.3% to close at 2,077.87. The banking sector ended the week mixed with MCBG gaining +0.7% while SBM closed unchanged and Bramer fell -1.2%. Activity was skewed towards MCBG, CIEL and SBM which together accounted for 71.3% of turnover as total value traded amounted to $14m. Foreign investors remained net buyers to the tune of $4.29m. NMH was unfortunately the week’s worst performing counter in the sector with the hotelier falling -1.5%.