Southern African markets rally behind in February


Southern African markets rally behind in February

THE SouthernTIMES Mar 19, 2018

    February ended with Ghana remaining the best performer year-to-date followed by Nigeria on the African stock markets.  

    The Southern African markets rallied behind with a few increases in the shortest month of the year. Below is a momentary overview of the markets’ events across the southern African region.

    In South Africa the equity market was lower in the first half of the month, with positive local developments driving gains in the latter half of February 2018, according to Momentum Investments. The FTSE/JSE All-Share Index went down 2.0 percent in February 2018, dragged lower by a 4.8 percent collapse in the FTSE/JSE Resources Index. Resource shares were hurt by rand appreciation in the month, related to increased optimism that South Africa’s (SA) economic trajectory was likely to improve under the new administration.

    The report by Momentum Investments indicated that a number of positive political developments lowered expectations for a sovereign ratings downgrade by Moody’s Rating Agency, scheduled to release its review on March 23, 2018. The swearing in of Cyril Rampahosa as the new president of South Africa, a well-received national budget and the appointment of a few key reformists in the latest Cabinet reshuffle buoyed financial shares.

    The FTSE/JSE Financial Index lifted 2.6 percent by the end of the month. A firmer currency weighed negatively on rand-hedge shares, leaving the FTSE/JSE Industrial Index 3.0 percent lower by the end of the month. The FTSE/JSE Small-cap Index edged 0.3 percent higher in February 2018, while the FTSE/JSE Mid-cap Index traded broadly sideways. The FTSE/JSE Listed Property Index slumped nearly 10 percent in February 2018, over allegations levelled at resilient and its associate companies.  The report also showed that the Inflation-linked Bond Index (ILBI) fared well, increasing by 1.3 percent in the same period.

    In Malawi, the market was bullish for the second month in a row, as it registered a positive return on investment of 4.32 percent (4.32 percent in US dollar terms) in February 2018 and an increase in both total traded value and total traded volume. The exchange officially listed a 5-year Treasury Note with a coupon rate of 10 percent on  February 26, 2018.

    According to the Malawi Stock Exchange, the market transacted a total of 245,801,275 shares at a total consideration of MK7,696,394,315.30 (US$10,606,029.73) in 118 trades. In the previous month, January 2018, the market transacted a total of 36,519,356 shares at a total consideration of MK1,318,037,153.35 (US$1,816,341.81) in 108 trades. 

    This reflects a 573.07 percent increase in terms of share volume and a 483.93 percent (483.92 percent in US Dollar terms) increase in share value. Of the shares traded, 131,787,578 NBS shares were traded as a Special Bargain. Daily average share trades exhibited similar trends where the market registered an average daily volume of 11,704,823 shares compared to 1,739,017 shares traded in January 2018. The average daily turnover for February 2018 was MK366,494,967.40 (US$505,049.03) compared to MK62,763,673.97 (US$86,492,47) in January 2018, reflecting an increase of 483.93 percent (483.92 percent in US dollar terms).

    The market registered a positive return on the index as reflected in the upward movement of the Malawi All Share Index (MASI) from 22223.44 points registered in January 2018 to 23182.59 points registered in February 2018, giving a return on  index of 4.32 percent (4.32 percent in US$ terms). 

    The price gains registered by FMBCH, NBS, NICO, TNM and OML were the drivers resulting into an upward movement of the Malawi All Share Index, arising from an increase in both the Domestic Share Index (5.05 percent) and the Foreign Share Index (0.88 percent). Market capitalisation increased in both Kwacha and United States Dollar terms from MK984,410.21 million (US$1,356.58 million) in January 2018 to MK1,026,897.03 million (US$1,415.13 million) in February 2018

    In Namibia, the NSX Overall decreased 1 point or 0.09 percent to 1,459 on Wednesday, March 7, 2018, from 1,460 in the previous trading session. As of the end of February 23, the Namibia market saw the ETF trade funds end at 547,477 in terms of shares and in N$68,947,803 with 12 trade deals. In terms of the currency, the exchange rate of USD to NAD increased 0.0340 or 0.29 percent to 11.8070 on Wednesday, March 7, from 11.7730 in the previous trading session. Historically, the Namibian dollar reached an all-time high of 16.87 in January.

    With regards to the interest rates, the Bank of Namibia left its benchmark lending rate unchanged at 6.75 percent on its February 14, 2018, meeting, saying the decision aims to continue to support growth and maintain the one-to-one link between the Namibia dollar and the South African rand. Namibia’s economy remained weak during 2017, mainly due to a decrease in the construction, wholesale and retail trade sectors and a slower growth in manufacturing, utilities, transport and communication. Growth is expected to recover in 2018. Meantime, annual inflation rate averaged 6.2 percent in 2017, easing from a 6.7 percent in 2016 and it is expected to be around 5 percent in 2018. Interest Rate in Namibia averaged 7.10 percent from 2007 until 2018.

    In Kenya, the Kenyan Finance Minister expects the economy to grow 5.8 percent this year, recovering from drought and political uncertainty that impacted growth in 2017. The budget deficit is projected to decrease to 6 percent of GDP in the next financial year starting July, and to 3 percent by 2022, from 8.9 percent in the financial year to end of last June. The NSE gained 0.16 percent. The NSE All Share Index ended at 180.91 on March 5, 2018, and the NSE 20 SHARE index was at 3,726.74. There was no change in terms of the EFT with funds ETF in Units-Total Deals being 0.00 and ETF turnover in Kenyan shillings also being 0.00. The FTSE NSE Kenya 15 Index ended at 225.30, while FTSE NSE Kenya 25 Index, FTSE NSE Kenya Govt. Bond Index and the FTSE ASEA Pan African Index ending at 232.89, 93.27 and 1,206.04 respectively market capitalisation (KES Billions) was 2,665.12 total shares traded was 45,441,500 on the day and total equity deals were 1,316.The exchange rate The USD to KES traded at 101.2000 on Wednesday, March 7. 

    The Zambian markets on March 6, 2018, saw the Lusaka Stock exchange having 8 trades with a total of 17,011 shares worth K15,697 being transacted. Trading occurred in CECZ, MAFS and ZNCO. Trading also occurred in CCAF on the quoted tier. The LuSE All Share Index (LASI) maintained the previous close of 5,586.64 points as there were no share price changes on the main board. 

    The market remained on a capitalization of K63,427,420,898 including Shoprite Holdings and K29,188,214,918 excluding Shoprite Holdings. The exchange rate on the same day for USD to ZMW increased 0.0022 or 0.02 percent to 9.7300 from 9.7278 in the previous trading session. The benchmark interest rate in Zambia was last recorded at 9.75 percent. 

    The consumer price inflation in Zambia slowed to 6.1 percent in February of 2018 compared to 6.2 percent in the previous month. high of 22.90 percent in February of 2016 and a record low of 6 percent in December of 2011.

    In Zimbabwe, the Zimbabwean Stock Exchange on March 6, 2018, saw the All Share index inching down 0.01 points (0.01 percent) to end at 86.70 points as four counters lost ground. The ZSEINDX ended at 290.3 with a 0.065 percent increase while the ZSEMNGX ended at 120.56, which was a drop of -3.483 percent. The Market Cap ended at US$8,263,320,125 with a market turnover of US$5,112,202.71. Foreign buys were US$4,356,927.10 while foreign sales ended at US$2,179,805.54. The total trades for the day were 111. The benchmark interest rate in Zimbabwe was last recorded at 9.39 percent.

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