African Thoughts: October 07, 2013

Last week we saw the start of Q4 for 2013. It seemed like there were some fund inflows into African/Frontier focused funds for the last quarter of the year. In general, market activity remains low with crosses evident in most markets. Nigeria had their Independence Day holiday celebration on Tuesday and was thus closed for the 1 session. The Nigerian market also moved to the new X-Gen trading system which witnessed a few teething problems but seemed to correct itself as the week went.

Zimbabwe:

2 “special bargains” took place during the week which really highlighted the week as the main Industrials Index rose for the 14th consecutive day. 12% of Dawn Properties crossed at a special price of 1.47c while Econet also saw a chunky block trade. The Industrials Index grew by 5.33% with demand across most heavyweight counters remains strong. Buying took place in Delta (+10.2%, 135c), BAT (+18%, 1365c), PPC (+9%, 261.51c), Innscor (+3.66%, 85c) and OK Zim (+3.7%, 28c).

Nigeria:

It was a shortened week in Lagos as Tuesday 1 October was a holiday for Independence Day. The week saw some foreign fund inflows which gave a bid to the market, in particular banks and consumers as the ASI rose 1.34% for the week. Consumers rose by 2.59% for the week with strength across the board while banks increased by 1.87% as Tier 1 names found themselves in favour yet again. In general, the market remains on the quiet side with crosses punctuating the landscape.

Egypt:

The EGX30 witnessed a poor start to the week, and reached the weekly low on Monday at 5,608.13, mainly due to FI profit taking in the likes of ETEL, ESRS, and TMGH. However, by mid-week Foreign investors returned, along with local institutions and started their buying spree in blue chips, such as COMI, JUFO, and HRHO. Accordingly, the market managed to end the week on a positive note gaining 0.38% to close at its week high at 5,726.22.

Kenya:

The NSE-20 rose by 1.54% last week while the All Share rose by 3.05%. Strong foreign buying in the blue chips was the most notable trend during the week while foreign activity also meant that overall activity was higher than normal. Banks were very much in demand with every banking name closing in the green for the week, led by Equity Bank (+1.48%, KES 34.25) and KNCB (+1.08%, KES 47). EABL saw some chunky crossing earlier in the week and eventually closed the week up 29bps at KES 340. Safcom remains highly in demand and finished the week up at an impressive KES 8.90, with demand for the name still very strong. The name touched an all-time high of KES 9.00 during the week.

Francophone Region:

The BRVM index grew by 1.50% last week but the strength was mostly due to the more illiquid and smaller names. The main name that trades there, Sonatel, actually fell by 27bps which dragged down the telecoms sector by 50bps.