By Weekly Markets Synopsis
BOTH major indices
were on the green during the week that ended on 28th August 2020
following appreciation of some domestic and cross listed counters.
The Tanzania Share
Index (TSI) added 7.36 points to close the week at 1,792.90 points while
the All Share Index (DSEI) gained 20.43 points to close the week at
1,792.90 points.
The points added to
the TSI resulted from the 9.09 per cent appreciation on the Twiga
Cement (TPCC) counter, from a price of 1,980/- during the previous week
to 2,160/- during the end of the week under review.
Twiga traded a
total of 18,937 shares at a price of 2,160/- during the week, accounting
for 30.8 per cent of the total equity turnover realized during the
week. Most of the transactions on the Twiga counter were among local
investors, complimented by some investment from foreign investors.
The price of Twiga
has been pushing its upper boundary since the company reported a 33 per
cent profit growth for the first six months of 2020. The company's
prospects are highly positive as the cement manufacturer operates in the
fastest growing sector in the economy, the construction sector.
The appreciation of
the price of Twiga was large enough to offset the 3.03 per cent price
decline on the CRDB counter. CRDB traded a total of 0.56mln shares
during the week, at a weighted weekly average of 159.64/- per share
. CRDB accounted
for 67.7 per cent of the total equity turnover making it the top mover
counter for the week. The bank's counter saw increased supply after its
price appreciated during the previous week. The increased supply
suppressed the price back to 160/- per share.
Cross listed
counters that moved the DSEI upwards were National Media Group (NMG)
which grew by 10.2 per cent and KCB Bank which grew by 7.04 per cent.
Jubilee Holdings (JHL) declined marginally by 0.85 per cent despite
positive half year results. Kenya Airways remained constant due to the
trading suspension. The airline's revenues along with the profits almost
halved during the first six months of 2020, cementing the need for the
government of Kenya to nationalize the airline.
The domestic market
capitalization grew by 0.21 per cent while the total market
capitalization grew by 1.15 per cent. The domestic market cap and total
market cap closed the week at TZS 9,188.93bln ($3.98bln) and TZS
14,885.10bln ($6.45bln) respectively.
The total equity
turnover realized during the week under review dipped by 89.7 per cent
to a total of TZS 132.8mln ($0.057mln) as the TBL counter traded only 5
shares at the market price. The total volume of shares also fell by 54
per cent to a total of 588,938 shares sold in 79 deals. As narrated
above, the most active counters were CRDB and TPCC which collectively
accounted for 98.5 per cent of the total weekly turnover.
Local investors
were still dominant of the market while maintaining almost wholly
dominance on the investment side and splitting almost half with foreign
investors on the divestment side. Locals accounted for 99.28 per cent of
the total investments during the week and 49.71 per cent of divestments
while foreign investors accounted for the balance.
Market, Bills and Bonds
The interbank rate
on the Interbank Money Market (IMM) gained 25bps during the week under
review which resulted from a sudden upward movement on Friday 28th
August 2020. The interbank rate closed the week at 3.25 per cent
compared to 3 per cent during the end of the previous week. The total
value of transactions amounted to TZS 138.6bln ($60mln) which is 9.8 per
cent less than the amount traded during the previous week.
The Bank of
Tanzania issued a 10 years Treasury bond in an auction held on 26th
August 2020 with an offer size of TZS 110.03bln ($47.65mln). The tender
size from the public amounted to TZS 262.68bln ($113.76mln) marking an
oversubscription rate of 138.7 per cent, higher than the previous 105
per cent.
Highest bids were
still on premium of the par value while the spread between highest bid
and minimum successful price tightened from 3.27/- to 2.11/-. The
weighted average yield to maturity (WAYTM) was 11.49 per cent which is
53bps down compared to the previous auction.
Currency Market
The shilling
maintained strength after recording a weekly appreciation for the fifth
week in a row on the Interbank Foreign Exchange Market (IFEM). The
shilling gained a marginal 3 pips during the week while the amount
traded on the IFEM slowed down by 1.6 per cent. The total value of
transactions recorded on the IFEM totaled to $8.17mln compared to
$8.3mln during the previous week.
orbit@orbit.co.tz; imani@orbit.co.tz,
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