African Thoughts: June 10, 2013

It was a mixed picture on the global stage last week as the northern hemisphere enters the summer period with Europe closing lower for the most part while the United States managed to rebound towards the end of the week after a good jobs report out on Friday. African markets also enjoyed mixed fortunes as a result of the global uncertainty, and as per usual we take a look at some of the best and worst performing markets from across the continent.

Nigeria:

The Nigerian bourse was the best performing market on the continent last week with the ASI gaining a rather impressive 4.70%. Both major indices put in solid performances with the Consumer Goods Index gaining 2.90% while the Bank Index gained 2.54%. Consumers in the form of Dangote Sugar (+13.1%), Flourmills (7.6%) and Nestle (7.4%) drove performance as foreigners and local investors alike continue to seek exposure to these tightly held names. In the banking sector it was the likes of UBN (+15.5%) after releasing better than expected Q1 2013 results, Stanbic (+7.1%) and Access (+4.4%) that drove the market higher. Market heavyweight DangCem put in a stellar performance last week with the counter gaining 17.2% to close at 210.00 after a few large crosses in the stock throughout the week. Activity was largely concentrated on block trading last week and this form of activity is expected to continue over the next few months.

Zimbabwe:

It was good to see both major indices move in the same direction in Harare last week with the Industrial Index gaining 3.04% while the Mining Index gained 1.04% even in the event of the political noise taking place last week with the constitutional court compelling the president to announce dates for the national elections. Econet and Delta once again completely dominated activity while the later closed at a new all-time high of 155c as foreigners continue to show interest in the counter. Econet however closed the week slightly lower as some form of profit taking ensued. Innscor announced that through their subsidiary Bakers Inn, they are targeting bread production capacity of one million loaves a day by 2015.

Egypt:

The market traded the week with a notable panic lead by selling from local investors leaving the EGX30 to end the week down 7.17% yet volumes were relatively low compared to recent averag. The selling last week came on the back of growing fears regarding the political and economic instability in the country with increasing calls for a massive protest on the 30th of June where all opposition parties agreed to join calling for an early election, adding to this the lack of catalyst to drive the market higher. The main sellers were local retail and local institutional investors, targeting names such as EKHO, CCAP and ORTE, yet international institutions ended the week as net buyers.

Kenya:

There was a slight bit of profit taking in Nairobi last week as the NSE 20 Index fell 0.9% to close below the psychological 5,000 level, turnover however increased 105% w/w on large volumes in EABL and Safcom early on in the week as a number of block trades took place in both counters. Safcom and Kenya Commercial Bank were the main drags on the market as they fell 0.7% and 1.2% respectively as foreign investors looked to lock in some decent profits. KenolKobil fell 4.8% despite positive news on a settlement case involving the oil marketer. The Kenya National Bureau of Statistics released May inflation figures which saw a 9% drop to 4.05%. Microsoft has pledge to support the Kenyan Government’s plan in training all primary school teachers to enable the laptop plan which begins in January 2014.

Mauritius:

The Mauritian market closed the week lower with the Semdex falling 0.4% despite MCB reaching a new record high of 196.25 but then closed the week at 195.00. The two major banking stocks MCB and SBM accounted for 56% of turnover as foreign participation was prevalent in both names. Lux Island Resorts was surprisingly active last week and accounted for 15% of weekly turnover. New Mauritius Hotels experienced mixed fortunes last week with the hotelier rallying to 72.00 but then witnessed some form of profit talking and closing the week unchanged at 71.00.