African Thoughts: May 16, 2016

Nigeria:

It was a better week in terms of activity, but things still remain very slow as turnover increased +51.72% to $48.61m. The market managed to close in positive territory with the ASI gaining +2.88% as banking stocks were the star performers with the sector gaining +8.77%. There were good performances from Skye Bank (+21.21%), Zenith (+11.79%) and GTB (+7.21%). Consumers were also stronger as the sector closed +4.12% higher thanks to Tigerbrands (+50.13%), Unilever (+11.66%), Nestle (+4.64%) and NB (+2.49%). The big news out last week Wednesday was that the federal government finally removed the fuel subsidy, and fixed the pump price of PMS at N145 per litre. Vice president Yemi Osinbajo has said they are substantially re-evaluating the country's foreign exchange policy, adding that a flexible approach should be expected soon.

Kenya:

The market came under pressure for a third straight week with the NSE 20 Index falling -0.9%, taking the YTD loss to -2.8% as foreign investors were net sellers to the tune of $2.9m (the highest in seven weeks). On the positive side, activity was better than the previous week with turnover increasing +62% to $25.8m as foreign participation accounted for 63.3% of activity. EABL unseated Safcom as the most active counter for the week with the brewer seeing net foreign outflows of $3.1m. KNCB recorded the most foreign inflows for the second straight week to the tune of $869k while the bank closed +5.00% higher ahead of Q1 2016 results. There were some big results released last week with EQBNK (+0.6%) releasing Q1 2016 numbers on Monday while Safcom (+2.4%) released FY 2015 numbers on Wednesday.

Zimbabwe:

The rally continued in Harare with the Industrial Index gaining +0.52%, trimming the YTD loss to -6.32%. Delta was one of the drivers behind last week's positive movement as the market heavyweight gained +2.78% after releasing FY 2016 results. There were also some good performances in Innscor (+2.17%) and Seedco (+1.79%). Activity unfortunately remains underwhelming as turnover fell -17.16% to $2.5m with Delta (41%), Innscor (30%), NatFoods (11%) the only names worth mentioning from an activity point of view. The national revenue collector ZIMRA gave a rather depressing update for Q1 2016 which saw the tax debt rise +30.9% to $2.58bn.

Mauritius:

The market closed the week slightly lower with the Semdex falling -0.1% while activity was rather dull with turnover amounting to $4.15m. MCBG closed the week -0.9% lower, but was the most active counter for the week after releasing Q3 2016 results. SBMH on the other hand closed the week +9.5% after announcing a reverse share split and releasing Q1 2016 numbers. Hoteliers came under pressure with NMH (-6.7%), LUX (-1.3%) and SUN (-0.6%) all closing lower.