African Thoughts: September 26, 2016


Nigerian volumes tried to pick up although activity still remains extremely thin across the board. Market direction also continues to be rudderless in the absence of any clear catalysts. Banks closed down 73bps while consumers fell by 53bps. The major movers in the banks were Guaranty (N25.09, -7.25%), Stanbic (N16.95, +9.35%) and Zenith Bank (N15.60, +7.59%). Guinness (N93.00, -7.01%) led the losers chart in the consumer sector while there were gains recorded in the likes of Cadbury (N15.75, +14.13%), PZ (N20.75, +6.41%), Flourmill (N20.04, +4.98%) and 7up (N150.00, +2.42%).


The NSE 20 fell by 1% last week thereby extending its YTD loss to 21.4%. For 4 out of the 5 sessions the market was extremely quiet although on Thursday we witnessed some extremely chunky crossing in both Safcom and EqBnk. Among the large caps, we saw some solid gains for Safcom (+2.6%, KES19.40), EqBnk (+4.9%, KES26.75) and EABL (+11.8%, KES284.00). KNCB was the only faller as it closed down 1.9% at KES25.75. In economic news, the MPC reduced the CBR by 50bps to 10%.


The market closed the week ever so slightly lower in Harare with the Industrial index closing -0.01% lower, taking the YTD loss to -13.90%. Heavyweight counters Delta (-2.79%) and Econet (-1.01%) were drags on the market. It was a better week from an activity point of view with turnover increasing +50.13% to $2.77m. This should however be taken with a pinch of salt as Delta accounted for 48% of total value traded for the week. There were a few results released last week with Innscor and NatFoods both releasing FY 2016 numbers. The markets were seemingly pleased with the figures as both Innscor (+16.16%) and NatFooods (+0.48%) closed the week in positive territory.


It was a decent week from a performance point of view in Port Louis with the Semdex closing +0.75% higher, trimming the YTD loss to -0.11%. Banking stocks lead the charge with both SBMH (+3.0%) and MCBG (+2.5%) closing the week firmly on the front foot. Hoteliers had a mixed week with NMH closing unchanged while SUN closed +0.3% higher. It was a rather dull week from an activity point of view with turnover amounting to $4.43m, with MCBG, SBMH and CFS accounting for the bulk of activity.

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