THE Dar es Salaam Stock Exchange (DSE) equity market performance has plunged once again as the Jatu rally continued last week.
The equity market performance registered one of its lowest turnover of the month as the downward momentum trend for also volume and prices observed.
Vertex International Securities said in its weekly market review report for a week ending last Friday that the turnover declined by 19.5 per cent to 250.58m/- while share exchanged hands were 0.63 million.
"Equities market continued with the downward spiral [last] week as turnover, and volume tumbled,” Vertex report showed.
Last week top gainers were Jatu, which gained 43.06 per cent to close at 1,030/- and Simba Cement, which gained 9.18 per cent to close at 535/- and TOL Gases went up by 6 per cent to 530/-.
CRDB Bank was the top loser after losing 1.92per cent to close at 255/- despite being a top mover of the week.
CRDB counter contributed 68.25 per cent of total market turnover followed by Jatu with 10.47per cent and DSE with 6.67per cent.
"However," Vertex said, "We expect Jatu’s momentum to spread into other counters as we approach the end of this quarter."
Zan Securities said in its weekly market wrap-ups that Jatu continued to appreciate for the second consecutive week after relisting following a temporary suspension to pave way for a primary offer.
"We also noticed the continuous share price appreciation for Jatu, as the counter has doubled in value in less than two weeks," Zan Securities said and projected that: "We anticipate the appreciation momentum to carry on this week."
However, other stock brokerage firms urged that low activities were due to the lack of prearranged block transactions which has suppressed equity turnovers to a second consecutive weekly drop.
Orbit Securities said in its weekly market synopsis that since August 2019, after the lowering of the minimum eligible value of the transaction to go through a prearranged block transaction, the prearranged market, almost similar to an over the counter (OTC) market, has been responsible for more than 85 per cent of the total equity turnover on the DSE.
"Flexibility of transaction prices on the prearranged market is not restricted by the allowable price spreads from the closing price, for that reason, and the fact that prices of large counters on the exchange have been stagnant for years, the prearranged market has gained a lot of traction over the last two years," Orbit said.
According to Orbit, with a lack of prearranged transactions, the collective total turnover for the last two weeks is less than 10 per cent of the turnover for the final week of last month.
During the week ending last Friday, foreign investors’ interest waned along with the prearranged transactions, leaving market dominance to domestic investors who accounted for 88.56per cent of the total investments made during the week.
Domestic investors also accounted for 95.52 per cent of the total divestments for the week. Foreign investors, remained net buyers with minimal participation, while the net inflow stood at 0.0075million US dollars.