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Nigeria’s MPC retains existing policy measures as election looms…… Nigeria’s MPC met over Monday the 19th and Tuesday the 20th of January in its first sitting for 2015, which came under the backdrop of the continued pressure on the oil price, the naira and of course the upcoming February presidential election. Key takeaways from the communiqué issued by the MPC included:
The National Bureau of Statistics (NBS) estimated real GDP growth at
6.23% in Q3 14 vs. 6.54% in Q2 14. The non-oil sector continued to
dominate, with services contributing 2.53 percentage points, agriculture
1.21pp and trade 1.08pp.
The MPC was, however, concerned about the weakening contribution of
the oil sector to overall growth, which is now being exacerbated by the
rapid drop in oil prices since June 2014.
Headline inflation for December 2014 was 8.0%, which was within the
range of 6.0% - 9.0% for inflation set by the CBN. The December inflation
rate reflected a reduction in core inflation, seasonal factors related to
the holiday period, as well as the stabilisation in food prices. The MPC
did, however, note upside risks to inflation including higher import prices
due to naira weakness and possible food supply bottlenecks linked
insecurity in the North.
Interest rates in all segments of the money market trended upward
between 26th November 2014 and 13th January 2015. The significant
increase in rates was mainly attributed to the further tightening measures
introduced at the November 2014 MPC meeting.
The naira continued to weaken, during 2014, with the exchange rate at
the rDAS-Spot opening at NGN 157.34/USD (including 1% commission) and
closing at NGN 164.08/USD, representing depreciation of 4.28%. The
inter-bank selling rate opened at NGN 165.7/USD and closed at NGN
180/USD, (depreciation of 8.63%) while at the BDC segment, the selling
rate opened at NGN 170/USD and closed at NGN 191.50/USD,
(depreciation 12.64%).
Gross official external reserves as at 31 December 2014 stood at USD
34.3bn compared with USD 42.9bn at the corresponding period of 2013,
largely due to increased funding of the CBN’s foreign exchange market
interventions to stabilise the exchange rate. This equated to 7.44 months
import cover.
Noting the above, all eleven MPC members voted to retain the MPR at 13%; retain the CRR on private sector deposits at 20%; retain CRR on public sector deposits at 75%; and retain the liquidity ratio at 30%. One member, however, voted for an asymmetric corridor around the MPR.
Country Performance
Country Daily % YTD% (USD)
Tanzania 0.03% 51.33%
Uganda 0.69% 14.53%
Kenya -1.13% 13.24%
Malawi 0.01% 8.07%
Namibia 0.00% 6.54%
Rwanda 5.49% 1.20%
Zambia 0.00% 1.20%
Botswana -0.05% -4.21%
BRVM 0.01% -9.66%
Mauritius -0.38% -9.70%
Zimbabwe -0.13% -17.75%
Ghana -0.24% -24.31%
Nigeria 0.15% -38.07%
Source: IAS/S&P
Source: IAS
Country Value traded (USD m)
Nigeria 21.82
Kenya 5.85
Mauritius 2.57
Zimbabwe 1.84
Botswana 0.81
Country Volume traded (m)
Nigeria 311.27
Kenya 35.24
Mauritius 24.21
Zimbabwe 3.93
Uganda 2.23
TOP 5 VALUE TRADED
TOP 5 VOLUME TRADED
1 100
1 300
1 500
1 700
1 900
2 100
2 300
Nov-13 Mar-14 Jul-14 Nov-14
US$ price index US$ total return
S&P Africa Frontier Index
Equity Research
Sub-Saharan Africa
21 January 2015
Africa Rising
Source: IAS/S&P
-
CLOSING MARKET SUMMARIES - 20 JANUARY 2015
While no further tightening was expected, particularly ahead of the election, it was a bit surprising that there was no further movement on the currency given the widening gap between the rDAS and inter-bank/BDC (parallel market) exchange rates. The CBN governor said the rationale behind keeping the exchange rate steady was that the MPC felt it was currently at the correct levels for “legitimate” fx demand, and that the bank would continue to intervene to support the market where required. As much as the bank is trying to discourage what it deems speculative demand, the fact that such a wide gap exists between the official and parallel rates means of course this will continue to fuel speculative behaviour. The Governor also took the time to address the issue of JP Morgan placing Nigeria’s government bonds, which are included in its global emerging markets bond index, on negative watch, citing what it viewed as a lack of liquidity on the Nigerian fx and bond markets. The liquidity was exacerbated by some of the measures the CBN put in place to try and curb “speculative” behaviour, which reduced the banks Daily Foreign Currency Trading positions initially to 0%, (subsequently revised to 0.1%) and introduced a timeline for the utilisation of fx purchased from the inter-bank market, which had resulted in the unintended consequence of disabling the price discovery mechanism for fx and virtually stopping trading. The market has since resumed trading following the changes made to the initial rules, and the CBN while disagreeing with the liquidity concerns put forward by JP Morgan, noted its commitment to Nigeria remaining on the JP Morgan index and will engage with JP Morgan in this regard. The Governor also noted that its fx rules are flexible and will be adjusted on a needs basis, and so should not be seen as permanent by any means. We expect the currency to remain under pressure given the above, especially with the oil price remaining weak as well as the normal nervousness that one sees ahead of elections. The equities market will thus, in our view, continue on a weaker bias in the short to medium term.
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CLOSING MARKET SUMMARIES - 20 JANUARY 2015
BOTSWANA
Index Today Previous Day % YTD %
BSE DCI 9 508.59 9 513.06 -0.05% 5.03%
Trading Activity Volume Daily % Turnover (USD) Daily %
20-Jan-15 2 056 691 23.05% 806 481 31.18%
Top Traders Volume Turnover (USD)
CHOPPIES 1 658 059 700 681
Top Gainers Bottom Losers
CHOBE 0.23% LETSHEGO -1.92%
BRVM
Index Today Previous Day % YTD %
BRVM 10 257.46 257.56 -0.04% 4.51%
BRVM Composite 249.14 249.12 0.01% 7.38%
Trading Activity Volume Daily % Turnover (USD) Daily %
20-Jan-15 210 723 447.08% 248 008 -53.06%
Top Traders Volume Turnover (USD)
ETI TG 200 371
OANTEL BF 99 895
Top Gainers Bottom Losers
PALM 7.48% SERVAIR ABIDJAN -4.39%
SAPH 7.48% SGB -3.09%
SODE 2.65% BAO BF -2.17%
AIR LIQUIDE -1.49%
FILTISAC -0.78%
GHANA
Index Today Previous Day % YTD %
GSECI 2 220.32 2 225.73 -0.24% 3.50%
Trading Activity Volume Daily % Turnover (USD) Daily %
20-Jan-15 155 150 -87.33% 56 971 -83.82%
Top Traders Volume Turnover (USD)
CAL 81 600 25 623
Top Gainers Bottom Losers
EBG 0.27% SIC -2.86%
UNIL -1.40%
GCB -1.31%
HFC -0.67%
KENYA
Index Today Previous Day % YTD %
NSE All Share 164.00 165.88 -1.13% 20.01%
NSE 20 5,139.06 5,177.38 -0.74% 4.30%
Trading Activity Volume Daily % Turnover (USD) Daily %
20-Jan-15 35 239 600 183.89% 5 846 011 112.01%
Top Traders Volume Turnover (USD)
Safaricom 14 468 900 2 203 665
Top Gainers Bottom Losers
Olympia Capital 7.19% Marshalls (E.A.) -8.47%
Housing Finance 6.59% National Bank -5.61%
Eveready East Africa 3.90% Scangroup -4.32%
NIC Bank 3.17% Mumias Sugar Co. -4.29%
Trans-Century 2.61% E.A.Portland Cement Co. -4.17%
MALAWI
Index Today Previous Day % YTD %
DASI 11 737.18 11 735.44 0.01% 19.16%
MASI 14 907.18 14 904.99 0.01% 18.96%
Trading Activity Volume Daily % Turnover (USD) Daily %
20-Jan-15 36 000 -38.83% 1 977 -40.46%
Top Traders Volume Turnover (USD)
FMB 26 000 1 068
Top Gainers Bottom Losers
FMB 0.21% There were no losers
MAURITIUS
Index Today Previous Day % YTD %
Semdex 2 031.53 2 039.21 -0.38% -3.06%
Sem 7 376.81 378.33 -0.40% -6.65%
Trading Activity Volume Daily % Turnover (USD) Daily %
20-Jan-15 24 214 600 958.38% 2 565 124 244.8%
Top Traders Volume Turnover (USD)
SBM 23 265 900
MCB 1 487 190
Top Gainers Bottom Losers
ROCKCASTLE(USD)* 8.33% United Docks -11.43%
Rogers 1.54% Policy -4.79%
NIT -3.92%
NAMIBIA
Index Today Previous Day % YTD %
NSX Local 390.34 390.34 0.00% 17.67%
NSX Overall 1 063.15 1 053.72 0.89% 6.66%
Trading Activity Volume Daily % Turnover (USD) Daily %
20-Jan-15 1 834 511 -33.99% - -100.00%
Top Traders Volume Turnover (USD)
MMI 772 435 -
Anglo-American -
Top Gainers Bottom Losers
B2Gold Corp 3.24% Paladin Energy -4.66%
Anglo-American 2.71% Barloworld -2.08%
Vukile Property 2.51% Oceana -0.92%
Truworths 2.25% MMI -0.71%
Nedbank 1.57% Shoprite -0.59%
NIGERIA
Index Today Previous Day % YTD %
NSE All Share 29,819.39 29,773.40 0.15% -27.85%
Trading Activity Volume Daily % Turnover (USD) Daily %
20-Jan-15 311 269 135 -26.97% 21 817 626 19.53%
Top Traders Volume Turnover (USD)
Fbnh 72 889 022
Zenithbank 3 384 985
Top Gainers Bottom Losers
Guaranty 5.28% Okomuoil -6.13%
Ubn 5.00% Rtbriscoe -5.00%
Upl 4.99% Uniondicon -4.96%
Uacn 4.98% Dangflour -4.90%
Guinness 4.37% Evansmed -4.82%
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CLOSING MARKET SUMMARIES - 20 JANUARY 2015
RWANDA
Index Today Previous Day % YTD %
RSI 239.01 226.58 5.49% 2.84%
RSE All Share 136.42 133.27 2.36% -1.23%
Trading Activity Volume Daily % Turnover (USD) Daily %
20-Jan-15 2 400 -85.28% 1 326 -81.69%
Top Traders Volume Turnover (USD)
Bralirwa 2 200 1 242
Top Gainers Bottom Losers
Bralirwa 6.85% There were no losers
Bank of Kigali 2.81%
TANZANIA
Index Today Previous Day % YTD %
TSI 4 817.38 4 816.07 0.03% 69.42%
DSEI 2 669.33 2 650.33 0.72% 43.01%
Trading Activity Volume Daily % Turnover (USD) Daily %
20-Jan-15 59 760 -81.95% 93 583 -28.31%
Top Traders Volume Turnover (USD)
CRDB 23 595
NMB 44 631
Top Gainers Bottom Losers
EABL 2.25% TCCL -2.67%
NMG 0.95%
KCB 0.89%
JHL 0.82%
ABG 0.50%
UGANDA
Index Today Previous Day % YTD %
USE All Share 2 000.88 1 987.09 0.69% 31.42%
Trading Activity Volume Daily % Turnover (USD) Daily %
20-Jan-15 2 233 790 160.49% 30 493 -67.61%
Top Traders Volume Turnover (USD)
SBU 2 165 890 25 399
Top Gainers Bottom Losers
UCHM 18.18% NMG -1.82%
EBL 1.92% KA -1.34%
KCB 1.64% CENT -0.82%
EABL 0.28% JHL -0.49%
UMEME -0.20%
ZAMBIA
Index Today Previous Day % YTD %
LuSE All Share 6 257.37 6 257.37 0.00% 18.06%
Trading Activity Volume Daily % Turnover (USD) Daily %
20-Jan-15 - na - na
Top Traders Volume Turnover (USD)
Market did not trade - -
Top Gainers Bottom Losers
ZIMBABWE
Index Today Previous Day % YTD %
Industrial 166.24 166.46 -0.13% -17.75%
Mining 58.14 58.14 0.00% 26.97%
Trading Activity Volume Daily % Turnover (USD) Daily %
20-Jan-15 3 934 223 653.37% 1 837 595 737.36%
Top Traders Volume Turnover (USD)
INNS 2 201 807 1 321 084
Top Gainers Bottom Losers
There were no gainers DZLH -11.11%
Imara Africa Securities (A division of Imara SP Reid) Imara House Block 3, 257 Oxford Road, Illovo Johannesburg 2146 South Africa Tel: +27 11 550 6200 Fax: +27 11 550 6295
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Exchange
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Zimbabwe Tel: +263 9 74554 Fax: +263 9 66024 Members of the Zimbabwe Stock Exchange
Imara S.P. Reid (Pty) Ltd Imara House 257 Oxford Road Illovo 2146 P.O. Box 969 Johannesburg 2000 South Africa Tel: +27 11 550 6200 Fax: +27 11 550 6295 Members of the
JSE Limited
Stockbrokers Malawi Ltd Able House Cnr. Hanover Avenue/ Chilembwe Road Blantyre Malawi Tel: +265 1822803 Members of the Malawi Stock
Exchange
Namibia Equity Brokers (Pty) Ltd 1st Floor City Centre Building, West Wing Levinson Arcade Windhoek Namibia Tel: +264 61 246666 Fax: +264
61256789 Members of the Namibia Stock Exchange
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