African Thoughts: September 14, 2015

Nigeria:

The Nigerian ASI finally moved into the green as the index rose by 60bps last week. This was despite news out on Wednesday that JPMorgan was to remove Nigerian bonds from their Government Bond Index - Emerging Markets (GBI-EM). This news triggered an immediate sell-off in bonds and equities although it did prove to be somewhat short-lived. In normal trading the major reason for the outperformance was the consumers which rose by 2.35%. This was mainly due to Guinness (+17.06%, N152.19) after their parent company Diageo announced plans to increase its stake in Guinness Nigeria from 54.3% to 70%. This pulled some other stocks higher such as PZ (+7.99%, N27.30) and NB (+2.37%, N127.77). The NSE Banking Index was also slightly up by 0.60% with gains in Zenith Bank (+8.14%, N16.99), Diamond Bank (+3.88%, N3.74) and ETI (+2.56%, N18.77) being the major drivers. Dangcem was also up by +2.12% (N168.00).

Kenya:

The NSE showed a second straight week of gains as the NSE 20 rose by 1.8% (YTD = -17.7%) and the NASI rose by 1.7% (YTD = -10.1%). However, outside of 1 cross in BATK the market volumes were very low. Among the large cap names the biggest gainer was EABL which closed up 7.94% at KES299. This is probably due to the announcement that their parent company Diageo is planning on increasing its stake in Africa. The banks were also strong with Equity Bank closing up 7.19% at KES44.75 and KNCB ending up 2% higher at KES46.00. Safcom bucked this trend and fell by 2% to KES14.55.

Zimbabwe:

The Industrials fell by a further 55bps last week and is now down 17.62% for 2015. The main reason for the fall was the 8.93% fall in Old Mutual which was partially offset by a 1.66% gain in Natfoods. The major names like Econet (27.02c), Delta (84.75c), OKZim (7c) traded largely unchanged. The ZSE remains incredibly dull though as volumes are still on the low side.

Mauritius:

The Semdex and the Sem-10 fell by 70bps (YTD -7.0%) and 90bps (YTD -4.8%) respectively last week. There was some foreign selling on most of the large caps and this drove the 2 banking behemoths lower - MCBG falling by 60bps to Rs210.00 while SBMH closed down 2.3% at Rs0.85. NMH saw some chunky trading yet closed unchanged at Rs18.50.