DSE turnover decreases 43pc in a week

DAR ES SALAAM: DURING the trading week ending on July 05th, the Dar es Salaam Stock Exchange (DSE) saw a decrease in turnover compared to the prior week.

The total market turnover decreased to 1.142bn/-, reflecting a 43.09 per cent downtick from the previous week’s 2.007bn/-.

There was no activity in the pre-arranged board. Throughout the week, CRDB dominated trading activities, representing 50.81 per cent of the total market turnover, followed by NMB at 33.76 per cent and NICO at 4.05 per cent.

DSE was the top gainer for the week, appreciating by 4.55 per cent to close off the week at 2,300/- per share. NMB gained 3.85 per cent closing the week at 5,400/- per share.

However, MKCB lost 6.67 per cent in its share price closing off the week at 560/- per share. In terms of market capitalization, there was a general increase in the size of the markets, with total market capitalisation increasing by 0.81 per cent to 16.970tri/-on by the week’s end.

Similarly, domestic market capitalisation increased by 0.85 per cent, reaching 11.954tri/-.

Key benchmark indices

• All Share Index (DSEI) closed at 2,033.31 points increasing by 0.81 per cent.

• Tanzania Share Index (TSI) closed at 4,513.24 points increasing by 0.85 per cent. Sector Indices

• Industrial & Allied Index (IA) closed at 5,120.14 points, unchanged from the previous week

• Bank, Finance & Investment Index closed at 5,331.46 points, up by 2.42 per cent

• Commercial Services Index closed at 2,134.27 points, unchanged from the previous week Bank of Tanzania plans to purchase six tonnes of gold in 2024/25.

The Bank of Tanzania (BoT) plans to purchase six tonnes of gold this financial year, it was announced in Dar es Salaam on Thursday.

It will be the biggest amount by far since the government began buying the precious metal from small, medium and large-scale miners as part of efforts to diversify the country’s foreign exchange reserves and reduce reliance on a single currency.

Dr Mwigulu Nchemba, Minister for Finance, said the government’s national gold reserve programme was meant to shore up foreign exchange reserves and support the implementation of the monetary policy.

Highlights: Debt Market Primary market

On Wednesday 3rd July 2024, the central bank was in the market offering 184bn/- to investors through re-opening a 15-year Treasury bond offering a 13.5 per cent coupon rate annually.

The auction was oversubscribed receiving 130.70 per cent subscription – the auction received bids totalling 240.486bn/- and accepted bids worth 184bn/-.

This is the first 15-yr Treasury bond auction since the issuance of the new reopening calendar from BoT for the first half of the year 2024/25.

This auction has seen oversubscription receiving a subscription rate of 130.70 per cent.

The price floor has increased compared to the last auction in May from 89.8237 to 90.1955.

The weighted average yield has decreased in this auction by 10.99 basis points relative to the previous auction held in May from 15.1615 per cent to 15.0516 per cent, the amount offered by BoT has been increased compared to the last auction from 72 billion to 184 billion and the central bank allotted the exact amount they required accepting bids worth 184 Billion. Inflation rate remains at 3.1 per cent in May same as the inflation in April.

Secondary market

During the week ending on July 05th, market activities saw a decrease compared to the previous week. Overall turnover decreased by 67.67 per cent, from 130.7307bn/- to 42.2699bn/-.

Similarly, there was a notable decrease in the number of trades, falling from 277 to 72. Trading activities primarily focused on the long end of the yield curve, with the 20-year and 25-year bonds traded contributing to 98.92 per cent of the total turnover.

In the corporate bond segment, there was an increase in activity compared to the previous week. NMB corporate bond NMB2022/25.T1 recorded a trade with a face value of 1.0m/- at a price of 92/15 while NMB2023/26.T1 recorded two trades totalling 2.0m/- at an average price of 85.7949.

TMRC-2023/28.T1 recorded a trade with a face value of 300m/- at a price of 100/-. CRDB-2023/28.T1 recorded three trades totalling 145m/- at an average price of 84/6667.

Outlook: The general market performance for the first half of the year has demonstrated a bullish trend, marked by significant price increases in various stocks, such as:

• NICOL: 60 per cent increase to 800/-

• DSE: 22.22 per cent increase to 2,200/-

• NMB: 15.56 per cent increase to 5,200/-

• CRDB: 13.04 per cent increase to 520/-

This growth has led to a 3.97 per cent rise in domestic market capitalisation, reaching 11.853tri/-, an additional 452bn/- over the six-month period.

Also read: DSE owners approve 145/- dividend per share

Cross-listed equities have also performed well, contributing 15.21 per cent to the total market capitalisation, which now stands at 16.834tri/-, representing an increase of 2.2tri/-.

In the debt market, fixed-income securities have shown cyclical returns in terms of yields. At the start of the year, yields on the long end of the yield curve were at 14 per cent, peaking at 15.7 per cent in early March following the reintroduction of re-openings.

By the end of June 2024, treasury bond yields on the long end had decreased to 14.6 per cent.

Our outlook for the second half of 2024 is optimistic, as we anticipate that these impressive numbers will positively impact stock prices

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