During the trading week ending on November 24th, a notable uptick in activities was observed on the Dar es Salaam Stock Exchange (DSE) compared to the previous week. The total market turnover amounted to 107.54bn/-, marking a 6,750 per cent increase from the preceding week.
This increase in turnover can be attributed to the acquisition of 68.33 per cent (43,504,403 ordinary shares) in Tanga from Afrisam Mauritius Investment Holdings Limited by Scancem International Da a subsidiary of Heidelberg Materials which was completed on November 22, 2023. Furthermore, the domestic market capitalisation slightly increased due to increased prices of domestic listed counters.
Throughout the week, the counters that saw significant trading activity included TCCL, CRDB, and NMB, accounting for 99.42 per cent, 0.38 per cent, and 0.12 per cent of the total market turnover, respectively.
In the same week, TCCL was the only domestic counter that registered price gain within the week, appreciating by 4.17 per cent to end the week at 2,000/- per share.
On the downside, two domestic counters lost value within the week, TICL lost 10 per cent of its value closing at 225/- per share, NICO lost 3.33 per cent of its value reaching 435/- per share as it traded ex-dividend
In relation to market capitalisation, there was a slight decrease of 0.23 per cent in the total market capitalization, closing at 14.603tri/-. Conversely, the domestic market capitalisation experienced a slight gain of 0.02 per cent, with a closing value of 11.435tri/-.
Key benchmark indices
- All Share Index (DSEI) closed at 1,751.28 points decreasing by 0.23 per cent.
- Tanzania Share Index (TSI) closed at 4,321.49 points increasing by 0.02 per cent
Sector Indices
- Industrial and Allied Index (IA) closed at 5,153.62 points up by 0.09 per cent.
- Bank, Finance & Investment Index closed at 4,636.31 points, down by 0.07 per cent.
- Commercial Services Index closed at 2,148.58 points, unchanged from the previous week.
Primary market
On November 22, 2023, the Central bank was in the market offering treasury bills to investors. The offerings consisted of 9.9bn/- for the 35-day maturity Treasury bill, 19.9bn/- for the 91-day T-bill, 49.9bn/- for the 182-day T-bill, and 72.67bn/- for the 364-day T-bill.
The 35-day has seen low demand in the past three auctions and this time it wasn't subscribed at all, the 91-day maturity bills in this auction did not receive any subscription as well. The 182-day bill received 45.09 per cent subscription. The 364-day bill was undersubscribed receiving 93.45 per cent slight improvement from the last two auctions.
Average yields have edged higher from the last auction. The 182-day has shown an increase from 8.56 per cent to 8.90 per cent gaining 34 basis points in the average yield from the last auction. The price floor in the 364-day maturity has been further lowered to 90.78 from 91.10 in the previous auction, the average yield has advanced upwards gaining 43 basis points to reach 9.71 per cent from 9.28 per cent in the previous auction.
Inflation rates have slightly dropped from 3.3 per cent in September 2023 to 3.2 per cent recorded in October 2023. However, the central bank's policy still stands on lessened monetary policy accommodation.
Secondary market
During the trading week ending on November 24th, there was a downtick in market activity compared to the previous week. The total turnover saw a decrease of 10.85 per cent, from 19.07bn/- to 16.99bn/-. Similarly, the number of trades decreased slightly, going from 58 to 51.
Within the week, the on-the-run 20-year treasury bond dominated trading, accounting for the majority, at 88.2 per cent, of the total turnover. Despite changes in activities along the yield curve, yields on the long end continued to rise significantly, averaging 14.4 per cent.
Activities in the corporate bond segment increased this week, one NMB bond traded with a face value of 5.0m/- at a price of 85 and one NBC bond traded at a face value of 100m/- at a price of 90.
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Outlook
Market activities increased in relation to turnover and domestic capitalization. Looking ahead, recent release of 3rd quarter reports will solidify year-end estimates further propelling stock prices upwards and are expected to maintain their favourable valuations in the coming weeks.
In the secondary market, the focus remains on the longer end of the yield curve. Specifically, we anticipate more trading activities centred around off-the-run 20-year treasury bonds. This is expected to push yields to approximately 14.2 per cent.
In the weeks ahead, activity in the secondary market will be driven by investors who missed out on the primary market auction and hence we anticipate significant trading activities for the 20-year treasury bond no 649.
