Tanzania: DSE Turnover Increases By 3pc in Week

8 October 2024
Tanzania Daily News (Dar es Salaam)
By Raphael Masumbuko

During the trading week ending on October 04th, the Dar es Salaam Stock Exchange (DSE) saw a decrease in turnover compared to the prior week.

The total market turnover decreased to 1.958bn/-, reflecting a 2.62 per cent downtick from the previous week's 2.011bn/-. The pre-arranged board registered some activities as CRDB recorded a block trade.

Throughout the week, CRDB dominated trading activities, representing 85.88 per cent of the total market turnover, followed by NMB at 5.23 per cent and TPCC at 2.54 per cent. TCCL was the sole gainer for the week, appreciating by 9.09 per cent reaching 1,920/- per share.

However, TPCC lost 6.25 per cent reaching 3,600/- per share while MKCB share price decreased by 3.57 per cent concluding the week at 540/- per share. DSE depreciated by 1.63 per cent reaching 2,420/- per share.

In terms of market capitalisation, there was a general increase in the size of the markets, with total market capitalisation increasing by 0.44 per cent to 17.848tri/- by the week's end.

However, domestic market capitalisation decreased by 0.28 per cent, reaching 12.150tri/-.

Key benchmark indices All Share Index (DSEI) closed at 2,138.47 points increasing by 0.44 per cent.

Tanzania Share Index (TSI) closed at 4,587.07 points decreasing by 0.28 per cent.

Sector Indices Industrial & Allied Index (IA) closed at 5,049.67 points, down by 0.57 per cent

Bank, Finance & Investment Index closed at 5,671.81 points, down by 0.03 per cent

Commercial Services Index closed at 2,138.48 points, unchanged from the previous week

Market news round up Monetary Policy Committee Statement

The Monetary Policy Committee (MPC) met on 2nd October 2024 and decided to maintain the Central Bank Rate (CBR) at 6.0 per cent for the quarter ending December 2024. The decision was reached on the consideration that inflation is projected to remain low, consistent with the target of 5.0 per cent. The MPC also projects growth to be steady in line with the improving domestic and global conditions.

Highlights: Debt Market

Primary market

On Wednesday 02nd October 2024, the central bank was in the market offering 156bn/- to investors for a new 15-Year Treasury bond offering a 13.5 per cent coupon rate annually.

ALSO READ; DSE soars 22pc in nine months

The auction was undersubscribed receiving 66.91 per cent subscription, the auction received bids totalling 104.381bn/- and accepted bids worth 101.563bn/-.

This is the third 15-yr Treasury bond auction since the issuance of the new reopening calendar from BoT for the first half of the year 2024/2025. This auction has seen under subscription receiving a subscription rate of 66.91 per cent. The price floor has decreased compared to the last auction in September from 90/- to 89/1317.

The weighted average yield has increased in this auction by 41.11 basis points relative to the previous auction held in September from 15.35 per cent to 15.7611 per cent. The central bank allotted less than what they required accepting bids worth 101.563bn/-. Inflation rate was recorded at 3.1 per cent in August.

Secondary market

During the week ending on October 04th, market activities saw an increase compared to the previous week. Overall turnover increased by 142.69 per cent, from 44.9733bn/- to 109.1445bn/-.

Similarly, there was a notable increase in the number of trades, rising from 59 to 118. Trading activities primarily focused on the long-end of the yield curve, with the 20-year and 25- year bonds traded contributing to 74.2 per cent of the total turnover.

In the corporate bond segment, there was a decrease in activity compared to the previous week. CRDB corporate bond CRDB-2023/28.T1 recorded two trades totalling 5.0m/- at an average price of 100/-.

Outlook:

Equities: The All-Share Index (DSEI) and Tanzania Share Index (TSI) opened the last quarter of 2024 with mixed signals. The DSEI gained 0.44 per cent, while the TSI declined by 0.28 per cent on a week to-week basis. With the release of the much-anticipated third-quarter results in the final week of October, we expect these to drive gains in the local market. Pricing movements are likely to intensify in the last weeks of October, extending into early November.

Debt:

A recent surge in the yield of bond No. 500, maturing in March 2034, has caused a kink in the yield curve, with 10-year maturities now reaching a weighted average yield of 15.7 per cent. This is expected to exert upward pressure on yields across other maturities, particularly in upcoming long-term auctions, where we may see discounted prices.

The Monetary Policy Committee (MPC) convened on October 2, 2024, and maintained the Central Bank Rate (CBR) at 6 per cent for the quarter ending December 2024. This decision reflects their assessment that inflation will remain low, aligned with the 5.0 per cent target. The MPC also forecasts steady growth in line with improving domestic and global conditions.

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