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Dar es Salaam Stock Exchange weekly activities surge

Dar es Salaam Stock Exchange weekly activities surge

THE DSE bourse this week has seen a surge in activities as foreign investors are increasing their holding in some domestic companies. The equity market alone transacted a total of 10.5million shares that generated a total of TZS 5.07Bln ($2.2Mln) equity turnover. The turnover generated is close to double the previous week’s transactions where the market generated a total of TZS 2.59Bln ($1.13Mln). The number of shares traded is more than 3 (three) folds increment from the 2.4million shares that were traded in the previous week. Despite the surge in market activities, both total and domestic market capitalization have slipped by 0.75% and 0.24%, respectively. The total market cap closed at TZS 16.12Trn ($7.01Bln) from TZS 16.24Trn ($7.06Bln) of last week. While the domestic cap has closed at TZS 10.23Bln ($4.45Bln). The slight drop in the market cap is to a large extent influenced by the bearish trend in the cross-listed market together with some few domestic stocks. The cross-listed market during the week maintained its downward trend, where all counters declined in share price except for two that remained unchanged. The top loser on the cross-listed stocks was East African Breweries (EABL) which declined by around 2.6% from TZS 3,080 to TZS 3,000 per share. KCB bank (KCB) and Jubilee Holdings (JHL) both declined by 1.14% and 0.91% respectively from TZS 880 to TZS 870 per share for KCB and from TZS 5,500 to TZS 5,450 per share for JHL.

On the domestic stocks, while most are still maintaining their bullish prices, some few counters have taken a back seat this week. CRDB has declined by 2.56% from TZS 395 to TZS 380 per share. The counter transacted approximately 32% of all shares traded during the week, generating over TZS 1Bln turnover. TCCL (Simba) has also declined this week, despite gaining expeditiously for the past quarter.

This week the counter declined by a mere 40 spreads and closed at TZS 1,960 per share from TZS 2,000 of the previous week. Notwithstanding the decline mentioned some few counters had edged upwards during the week including NICO and JATU.

NICO which has become busy in the past month has gained a whopping 18.4% closing the week at TZS 610 per share while JATU also went up 10 spreads to close at TZS 205 per share.

The surge in activities on the DSE was chaired by the VODA counter which traded approximately 5.9 million shares that were generated over TZS 2.9Bln ($1.26Mln), the counter accounted for over 57% of the market activity on the bourse.

Despite the massive volume that the counter transacted the price remained unchanged because the transaction went through the prearranged board. Foreign investor remains market leaders this week.

The foreign investors had bought shares worth TZS 4.3Bln ($1.87Mln) which is about 85% of the buy side activities. On the same note, they sold shares worth TZS 4.31Bln ($1.88Mln) which is also about 85% of sell side activity.

This leaves local investors with 15% on the buy and sells side, buying shares worth TZS 769Mln and selling shares worth TZS 760Mln.

Bond Market

The Bank of Tanzania (BOT) on behalf of the government administered the treasury bills auction during the week. The bank received a total of TZS 202.3Bln ($87Mln) tender from the public, from an offer amount of TZS 78.4Bln ($34.08Mln), an oversubscription of about 158%.

The bank ended up only taking about TZS 65.5Bln ($28.4Mln) of the tendered amount which was even lower than the offered amount.

The yield for the 1-year treasury bills has declined by 40bps to 3.62% down from the 4.02% that was recorded in the previous auction. Furthermore, during the week the central bank on behalf of the government had reviewed the fixed- coupon rate of its long-term securities and it wasn’t necessarily appealing to investors as the rates have been reviewed downwards.

The 2-year paper now carries a 7.6% coupon down from 7.82%, 5-year paper down to 8.6% from 9.18%, and 7-year paper at 9.48% down from 10.08%. The long-term papers also now carry less coupon rates and have been much affected.

The 10-year paper is now at 10.25%, 15-year paper at 11.15% 20-year paper at 12.1% and 25-year paper at 12.56%, these have been reviewed from 11.44% to 13.5%, 15.49% and 15.95% respectively. With mixed reactions from investors, we believe the adjustments of these rates will boost rate adjustments from banks and will likely attract more corporate bonds.

Money Market

The interbank Cash market (IBCM) during the week traded a total of TZS 43.5Bln, this is about half TZS 110Bln that was transacted the previous week. The interbank rate has slightly improved to 1.76% from 1.5% of the previous week, albeit still one of the lowest rates to be recorded by the BOT in recent years.

The trend on the IBCM suggests that the banking system has sufficient liquidity hence the competitive rates. The TZS has kept on weakening against the USD, where the exchange rate has now reached TZS 2,310.07 up from TZS 2,310.02 the previous week.

With worsening trade terms due to the ongoing war, while the country is a net importer, the pressure on the shilling is expected shortly. The banks traded a total of 7Mln on the foreign exchange market during the week.

You might be bright, but a brighter fellow exists

DEAR nephew Milambo Greetings from this confused ...

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Author: WEEKLY MARKET

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