Weekly commentary on African equity markets

Overall sentiment on African equity markets was bullish with most markets advancing this week. Once again, Zimbabwe led the pack. Its benchmark index jumped another 11.43%, while, conversely, Nigeria’s declined 1.66% over the week.

West Africa

BRVM – The Western Africa regional exchange confirmed its positive momentum. The Composite Index gained 1.74% in a week that saw XOF 922m (USD 1.68m) worth of shares change hands every day on average, up 2.5x from the last week of January.

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The market is now down 6.34% year-to-date and the total market capitalization stands at XOF 4,091bn (USD 7.5bn). The top performer this week is the Bank of Africa – Mali. The stock soared 23.75% over the 5-day period and is now up 32% since the beginning of the year. The market heavyweight, Sonatel, closed the week at XOF 11,290, up 2.63% over the week. Shares in the telecom operator are down 16.37% year-to-date.

NGSE – Bears set the tone on the Nigerian market this week. The ASI declined each day of the week to close at 41,709.09, down 1.66%. Analysts at Greenwich Merchant Bank attributed the bearish performance to “the profit booking activities across counters that gained in the previous week’s rally and the gradual uptick in the stop rates at Primary Market Auctions (PMAs)”. A daily average of NGN 5.3bn (USD 14.0m) worth of shares was traded over the last five days.

The total market capitalization stands at NGN 21.8tn (USD 57bn), up 3.57% year-to-date. The top performer on the main board this week is Jaiz Bank Plc. Shares in the non-interest Nigerian bank operating under Islamic banking principles jumped 10.77%. They are up 9.09% so far this year. Dangote Cement, on the other hand, lost some ground and closed the week at NGN 230 (-2.54%). The shares in the cement producers are down 6.08% YTD.

North Africa

BVC – Morrocan equities had a good week. The MASI gained 0.72% in a thinly traded week as MAD 83.4m (USD 9.3m) worth of shares changed hands every day on average. Total market capitalization stands at MAD 605bn (USD 67bn). Wafa Assurance is the top performer this week. The shares in the insurer rose 7.49%. The heavyweight Maroc Telecom closed at MAD 146.8 on Friday, up 1.24% so far this year.

EGX – The Egyptian market edged up this week. The EGX 30 added 0.17% and closed at 11,598.85 points on Thursday. Average daily turnover stood at EGP 1.73bn (USD 110m) and the total market capitalization amounts at EGP 706.3bn (USD 45bn). The benchmark index is up 6.95% so far this year. The top performer this week is, once again, GlaxoSmithKline SAE.

The counter soared another 75.85% over the week. Remember, the London-listed drugmaker Hikma announced on January 26th it entered negotiations with the international pharmaceutical company GSK to acquire some of its assets in Egypt and Tunisia as part of a wider deal. Shares in GSK’s Egyptian subsidiary have gained 127% since the news broke.

East Africa

NSE – Kenyan equities advanced this week. The Nairobi Securities Exchange’s benchmark index edged up 0.98% over the week. Average daily turnover stood at KES 624m (USD 5.7m) and the total market capitalization amounts to KES 2,414bn (USD 22bn). The market is up 3.29% year-to-date. The top performer this week is East African Breweries. The stocks jumped 10.35%. The company announced on January 28th that it recorded a net sales decline of 3% to KES 44.5bn for the half-year ended December 2020 compared to the same period a year before.

The performance is however 53% better than the previous half (January to June 2020) that was significantly impacted by Covid-19 restrictions. Off-trade and the eCommerce segment, i.e. the online distribution platform it set up where consumers could order drinks and have them delivered straight to their homes, will remain key drivers of sales this year as the brewer continues making investment in can beers and spirits.

Safaricom’s performance is less flamboyant. Nonetheless, the telecom operator’s stocks hit a new high on Thursday at KES 36.85 as the company continued to attract interest from foreign and local investors alike. The stocks closed at KES 36.20 on Friday, up 5.69% this year.

Southern Africa

JSE – South African equities recovered this week. The JSE ASI jumped 2.91% to cross the 64,000 mark and closed at 64,289.48. The benchmark index closed just shy of the record high it reached on January 25, tracking firmer global markets as progress on stimulus, vaccines and positive global economic data lifted sentiment. South African equities are up 8.22% so far this year. The top performer this week is Rex Trueform Group. The shares in the relatively small clothing retailer soared 64.95%.

ZSE – The Zimbabwean market had another stellar performance this week as the ASI jumped 11.43%. Daily average turnover declined by half approximately to ZWL 104m (USD 1.3m) and total market capitalization reached ZWL 485bn (USD 5.8bn). The logistics group Unifreight Africa Limited remains the continent’s top performer this week. The company’s stocks gained 106.23% WoW.

Source: African-markets