African Thoughts: November 04, 2013

Good morning. A mixed week last week globally and Africa was no exception. Below is a brief summary of what happened last week.

Zimbabwe:

The Industrials index gained a slight 7bps for the week with large cap names leading the outperformance. However, volumes remain light on the ZSE. Delta gained 74bps to 136c for the week after they launched the super sip brand (a ready to drink dairy beverage). Econet rose by an impressive 1.83% to 61.1c after releasing a solid set of results for the H1 ended 31 August 2013 – top line revenue grew by 11% as they continue to expand their mobile money business. Natfoods was another rise as it gained 42bps to 241c. These gains were offset by losses in Innscor (-2.35%, 83c) and BATZ (-4.17%, 1150c). In general, foreign activity remains muted.

Nigeria:

The ASI gained 81bps last week as strong foreign demand in the consumer sector pushes the index. Consumers closed the week up 2.92% with foreign buying pushing the likes of Nestle (+7.4%, N1128.76), NB (+3.29%, N175.60) and Guinness (+3.58%, N246.53). Banks were down marginally with performance very mixed across the sector as results season continues in earnest. The best performing banks were UBA (+5.79%, N8.04), Guaranty (+2.78%, N25.90) and Diamond (+3.81%, N6.82) and this was offset by weakness in Access (-10.39%, N9.31) and Skye Bank (-11.45%, N4.10). Wapco rose by 6.60% to N105 after releasing their Q3 results. As mentioned, it is results season in Nigeria and last week we saw the following results announced, inter alia: Glaxosmithkline, UBA, Nestle, Dangote Cement, FCMB, ETI, Cadbury, Fidelity, Access Bank, Diamond Bank, Skye Bank, Stanbic IBTC Holdings, Dangote Sugar and Wapco.

Egypt:

The EGX30 index was broadly unchanged for the week as it ended up just 16bps with most of the local interest shifting towards mid/small caps for quick technical trades leaving big names such as COMI, HRHO, and TMGH trading in a narrow range. PHDC witnessed increased trading activity with many investors booking profits ahead of its rights issue which started trading today Monday Nov 4th.

Kenya:

The Kenyan NSE 20 gained a solid 1.10% for last week as strong foreign buying in the blue chips continues to drive the market. The results season has also begun with KNCB releasing late last week. Equity Bank released their results early this morning while Safcom is due out tomorrow. In the banking sector, KNCB closed the week unchanged at KES 48.50 and Equity Bank gained a modest 70bps to KES 35.75 while Barclays Bank also ended the week unchanged at KES 18.65 on some unusually high volumes. EABL saw some strong foreign trading on both sides yet inched up by 31bps to KES 320 for the week. Safcom was absolutely on fire last week, both in terms of turnover and performance – it was the highest traded stock and closed the week up 1.06% at KES 9.55.

Mauritius:

The Port Louis bourse rose by 1.6% last week while the Sem-7 gained a more modest 80bps. The gains were mostly due to the hotel sector as we saw strong gains in NMH (+3.1%), Lux Island (+22.5%) and Sun Resorts (+11.3%). The top tier banks also performed solidly as we saw MCB gain 10bps and SBM gain 1% which was offset by a fall of 2.9% in Bramer Banking.

Francophone Region:

Despite a short week last week as the BRVM market took Friday off for All Saints Day, we saw a plethora of results come out. The index gained a mere 14 bps for the week although YTD the BRVM Comp is up 25.82% while the BRVM 10 is up 23.65%. Sonatel gained 62bps to XOF 18,615.