THE Dar es Salaam Stock Exchange (DSE) equity market performance has defied the odds of rising rates and inflation to register positive performance.
The domestic equities prices continued with last week’s recovery trend as most indices closed in green despite inflation reaching 4.9 per cent the highest in the last five years.
Vertex International Securities Chief Executive Officer Mateja Mgeta, said the domestic equity market performance echoed their last week’s forecast as equities continue to “defy odds of rising rates and inflation”.
“We expect further positive performance next week as strong earnings factor continues to fuel investors’ buying appetite,” Mr Mgeta told Daily News on Monday.
The total market capitalisation increased by 0.16 per cent to 15.603tri/- and domestic market capitalisation increased by 0.36 per cent to 10.196tri/-.
NMB share gained by 2.74 per cent to 3,000/-, being a top gainer of the last week followed by NICOL whose share prices climbed by 1.54 per cent to 330/- while Swissport went down by 6.94 per cent to close the week at 1,340/-.
Nevertheless, the price of Swissport shares is still 44 per cent up since the beginning of the year following investors’ excitement of the company’s recovery after the pandemic.
The weighted average coupon yield of 20 years Treasury bond that was auctioned a fortnight ago went up by 11.5bps to 12.2209 per cent while the central bank accepted all 286 bids including the lowest bid price of 93/7684 compared to the minimum successful price of 98/5224 during the previous 20 years Treasury bond auction.
“…Making this the fourth consecutive 20 years bond auction with an upward movement of the yield,” Mr Imani Muhingo, Head of Research and Financial Analytics at Alpha Capital said.
Headline inflation has hit five years high at 4.9 per cent for the year ending October.
Mr Muhingo said despite the core inflation is at the bottom of the policy range of between 3.0 per cent to 5.0 per cent, the non-core inflation was 10.6 per cent.
The food inflation hit 9.1 per cent as the price of rice reached its record high according to reports by the central bank, while energy, fuel and utilities hit 8.7per cent.
“Generally,” Mr Muhingo said, “headline inflation is pushed up by food and energy inflation of which reasons are at a large extent independent from the domestic money supply.”
Rising food prices are caused by the shortage of food in the East African region which faces the driest period in the last 40 years, according to FAO.
However, the market recorded a weekly turnover increase of 3.7 per cent to 1.14bn/- from 2.01 million shares traded.
The top mover for the last week was CRDB Bank which accounted for 58 per cent of the total equity turnover for the week, followed by TBL and NMB which accounted for 21 per cent and 14per cent respectively.
Collectively, the three counters account for 93per cent of the total weekly turnover.
