African Thoughts: September 19, 2016


Nigeria:

It was a rather woeful week from an activity point of view, compounded by the fact that it was a shortened trading week due to the Eid celebrations, with turnover falling -46.65% to $17.44m. On the positive side, the market managed to close in positive territory with the ASI gaining +1.02%, trimming the YTD loss to -2.74%. Consumer stocks were the top performers for the week with the sector closing +2.30% higher thanks to gains in Unilever (+14.23%), PZ Cussons (+4.56%), GSK (+2.56%) and NB (+2.29%). Banking stocks came under a bit of pressure with the sector closing -0.92% lower with losses in UBA (-6.87%) and Zenith (-0.68%). August CPI data showed that consumer prices increased +17.6%.

Kenya:

It was also a shortened trading week in Kenya with Monday being closed due to the Eid celebrations, and as such, we saw a decrease in market activity. EQBNK and Safcom dominated what little activity there was as the market heavyweights accounted for 23% and 21.3% of total turnover respectively. The market closed the week marginally lower with the NSE 20 Index falling -0.1%, taking the YTD loss to -20.7%. KNCB (-7.1%) was amongst the worst performers after the bank followed EQBNK in cutting mobile lending rates. EABL was one of the better performers for the week with the brewer gaining a rather pleasing +7.6% thanks to foreign buying interest. On the news front, Equity Bank held a briefing on Thursday where management noted a change in strategy following the new banking act. Going forward, the bank will primarily focus on increasing loan volumes (targeting increased affordability due to lower rates) as well as improve efficiency of the bank to support profitability. According to management, the new rate will be applied across all its credit facilities, including mobile lending and credit cards.

Zimbabwe:

The market managed to close the week slightly higher in Harare with the Industrial Index gaining +0.19%, trimming the YTD loss to -13.72%. There were some decent performances in Innscor (+2.59%), NatFoods (+2.44%) and Econet (+0.56%). Activity continued to underwhelm with turnover falling -26.13% to a dismal $482k for the entire week. Econet (37%) and Delta (37%) dominated what little activity there was.

Mauritius:

The market closed the week slightly lower, with the Semdex falling -0.53%, taking the YTD loss to -0.85%. Banking stocks ended the week mixed with MCBG closing unchanged while SBMH fell -2.9%. Hoteliers came under some pressure with SUN (-1.2%), NMH (-1.0%) and LUX (-0.8%) all closing lower. It was a relatively average week from a turnover point of view with value traded amounting to $5.18m. This should however be taken with a pinch of salt, as MCBG accounted for 56.4% of turnover for the week. Foreigners were net sellers to the tune of $2.4m.

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