By JOINT REPORT The EastAfrican
In Summary
- Analysts project that the region’s bourses will benefit from relatively low inflation rates, which should leave consumers with more money to invest.
- Several initiatives are anticipated to boost the bourses’ performances.
Regional bourses are expected to post stronger
performances in the second quarter of 2014 than they did in the first
quarter, capping what has been a rewarding period for investors across
the region.
Most firms have doled out increased dividend
payouts on the back of better financial results for 2013 and the first
quarter of 2014.
Stocks are expected to perform well in the coming
months due to projected stable inflation and initiatives introduced by
the Uganda, Rwanda, Tanzania and Kenya bourses.
Analysts project that the region’s bourses will
benefit from relatively low inflation rates, which should leave
consumers with more money to invest.
Steady foreign interests in regional stockmarkets
is expected to see indices rise significantly this year, alongside the
turnover.
By last week, turnover at the Rwanda Stock
Exchange (RSE) had risen 28-fold to Rwf222.5 million ($322.021) from
Rwf7,878,200 ($11,400) in March, riding on huge volumes of shares traded
on Bank of Kigali (BoK) and Bralirwa counters.
In Tanzania, banking, investment and manufacturing
companies continue to perform strongly attracting more long-term
investors with the aim of making huge profits. The Dar es Salaam
Securities Exchange (DSE) index last week reached 2023.9 points,
compared with 1958.09 in March.
A number of stocks at the Uganda Securities
Exchange (USE) are forecast to remain flat in the second half of 2014,
with many investors apparently jittery about interim earnings while
anticipated increases in government borrowing are likely to pile more
pressure on interest rates earned on treasury bonds.
This trend could mirror similar patterns witnessed
at the local bourse since the beginning of the year, with many stocks
posting little or no gains while a few blue chip shares have accounted
for sharp gains in the All Share Index (ALSI) and Local Stock Index
(LSI).
Data obtained from the USE shows that the ALSI
opened at 1,522.46 points in January; it hit a high of 1,571.16 later
that month but fell to 1,420.16 in early February. It closed at 1,503
points at the end of March.
“Conclusion of the dividend season between April
and May usually leads to modest performance in share prices after June.
We expect accelerated economic recovery during the last quarter of 2014
and this in turn will encourage some investors to take up fresh
positions on various counters so as to profit from a rebounding
economy,” said Arthur Nsiko, stockbroker and research analyst at African
Alliance Uganda.
“This will spur upward movements in share prices
but the impact of rising interest rates on treasury bonds seems mixed,
with some investors more determined to wait out the difficult economic
spell,” he added.
At the Nairobi Securities Exchange (NSE), banking
stocks continue to drive activity, riding on improved profitability that
saw Equity, KCB Group, StanChart and Co-operative Bank post improved
2013 earnings.
No comments :
Post a Comment