African Thoughts: March 18, 2013

The developed world had a rather strong week last week from a performance point of view with the Dow Jones closing at new all-time highs on numerous occasions. There was however panic yet again in the Euro zone over the weekend as Cyprus announced a new levy on bank deposits in order to fund their debt. It will be interesting to see how this affects African markets from a risk perspective over the coming sessions.

Kenya:

To say that the Kenyan market was volatile last week is a complete understatement. Things got off to an absolute flyer with the NSE 20 Index gaining 2.96% and 3.95% on Monday and Tuesday respectively as the optimism surrounding the recent elections continued. Profit taking was however very evident towards the end of the week as the market only managed to gain 2.5% for the week. EABL was very active with foreign participation prevalent on both sides of the name. Access Kenya announced an increase of 38.8% in EPS while Britam posted FY EPS of 1.40 Shillings. The MPC retained the benchmark rate at 9.5%.

Maurtius:

It was a rather solid week in Mauritius with the Semdex gaining a very satisfactory 1.3% to close at 1,915.93. MCB was unfortunately the only name to talk about as the banking giant dominated from an activity and performance point of view, gaining 2.5% to close the week at 195.00 as foreign investors continue to push it higher. On a positive note, tourist arrivals for February rose 2.3% to reach 81,185 as arrivals from China increased 271.6% after the introduction of direct flights from Shanghai. The Bank of Mauritius left the key repo rate unchanged at 4.90% at its meeting held on the 11th of March.

Nigeria:

Subdued week in Lagos last week as the ASI gained a rather dull 0.31%. Profit taking was very evident across the banking sector as the Bank Index fell 0.80% with Access (-11.30%) being the biggest loser in the sector after announcing Q2 forecast of PAT N9.181bn. On the positive side consumer stocks had a positive week thanks to a rally in a number of the blue chip names with the Consumer Goods Index gaining 2.01%

Zimbabwe:

The Zimbabwean market came under some pressure last week with the Industrial Index falling 1.64% while the Mining Index fell 4.07%. Foreigners dominated trading as they continue to seek exposure to the blue chip names such as Econet, Delta, Innscor, DZL etc. Inflation for February rose to 2.98% from 2.51%. The much anticipated referendum took place over the weekend and so far as we understand it voting went on peacefully and initial results show a landslide YES outcome for the new constitution. We expect full and formal results by tomorrow. This being the case, the next hurdle is the main electoral poll which whose date should be announced soon. We hope it proceeds in an equally peaceful manner.