African Thoughts: March 24, 2014

Although global markets had a positive week the African markets remain somewhat quiet. Having said that though, activity did pick up towards the latter part of the week.

Zimbabwe:

There is still a general lack of interest in the Harare bourse from both local and foreign investors. The ZSE continues to drip lower as results releases continues. In economic news, inflation statistics showed a negative year-on-year stats of -49bps raising questions about deflation. On the market, the Industrials lost 2.75% for the week as liquidity remains low (ADV last week was a disappointing $672k). Market heavyweights were weak as losses were recorded in Innscor (-5.56%, 68c), Econet (-4.6%, 62c) and Delta (-3.28%, 117.99c). These losses were partially offset by gains in Natfoods (+4.88%, 215c) and Old Mutual (+2%, 255c).

Nigeria:

The NSE ASI shed 1% last week. In the banks, it was a poor start to the week although the sector rallied on Thursday and Friday as the banks eventually gained 2.72% for the week. Tier 1 names typically led the rally with names like GTB (+8.23%, N25.65), FBNH (+6.68%, N12.45) and Zenith (+2.90%, N22) all outperforming. Tier 2 names also did well and these were led by Stanbic (+7.69%, N21) and FCMB (+3.96%, N3.41). Unfortunately the consumers could not follow suit and lost 3.1% despite NB rallying by 5.08% to N152.89. Flourmills (-11.51%, N67.25) and Intbrew (-10%, N23.14) were big contributors to the weakness. During the week we saw FY13 results come out from Lafarge Wapco while the CPI data for February was released showing a drop to 7.7% compared to 8% in January.

Kenya:

The NSE 20 fell by a mere 20bps last week although turnover was markedly improved. As usual, trading was dominated by the usual suspects while foreign participation remains skewed to the sell side. Safcom gained an impressive 4.6% to KES 12.60 while EABL grinds higher and rose by 40bps to KES 261. The banks had a mixed week as we saw KNCB rise by 1.6% to KES 46.75 while Equity Bank fell by 5.9% to KES 32.00.

Mauritius:

It was a generally dull week in Port Louis outside of a few local fund bookovers. Both the Semdex and the Sem-7 marginally lost ground. In the banks, MCB remains strong and gained 30bps to Rs215.75 while SBM ended the week unchanged at Rs1.06. Bramer Bank rose by 60bps to Rs131.50. The hotel sector was soft with losses in NMH (-2.5%), Lux Island (-70bps) and Sun Resorts (-1.3%).