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Africa investor Ai40 Weekly Commentary – 27 March 2017

By David | March 27, 2017

Last week, the Ai40 Investor’s Index cooled down following significant upward movements that saw the Index reach a record high for 2017 in the previous week. Kenyan banking equities stole the show as they dominated the Gainers List. The Index was down marginally by 0.27 points, a drop of 0.28% from last week’s value of 94.33. The Index closed Friday at a value of 94.06.

In world markets, the key development investors were watching on Friday was the US Congress’ vote to repeal the “Obama Care” health-care bill. Due to a deficit of votes in favour of overhauling the bill, Republicans pulled the bill and this dealt a blow to President Trump who has faced strong opposition to implement a variety of policies since taking office. US equities closed mostly lower on Friday. European shares were also lower for the week as investors were anxious following the terrorist attack in the UK. Meanwhile in Asia, investors remain wary of China’s rising corporate debt levels. Oil prices were up slightly on Friday, buoyed by Saudi Arabia’s cut in exports to the US. A barrel of West Texas Intermediate (WTI) was trading at $47.85.

At Friday’s close, the Dow Jones Industrial Average was in negative territory and lost 0.29%, or 59.86 points, to close at a value of 20,596.72. The Nasdaq Composite Index closed marginally up by 0.19% or 11.05 points to end the session at 5,828.74. The S&P 500 was down -0.08%, or 1.98 points, to close Friday on a value of 2,343.98. In Europe, Germany’s DAX 30 dropped by 0.26% and Britain’s FTSE 100 was down 1.2%. Japan’s Nikkei 225 fell 1.76%.

Nairobi-listed banking stocks were the best performers over the week as the NSE’s benchmark index hit new highs thanks to gains by large-cap stocks. Equity Bank was the best performing stock on the Index with a gain of 5.2%. Last week the founder of the bank, Peter Munga, reaffirmed the current CEO’s position for the next few years in order to navigate the changing regulatory environment amongst other challenges. Shares for Kenya Commercial Bank performed just as well with a 5% gain while Barclays Bank Kenya was up by 2.9%.

Safaricom – a Kenyan telecoms firm – also featured on the Gainers with an increase of 2.8% over the week. Ghana-listed Tullow Oil was up 2.4%.

Stock for Vodafone Egypt fared the worst on the Index with an 8.8% drop last week. Guinness Nigeria was in similar territory as the shares suffered an 8.6% decline. The Central Bank of Nigeria’s Monetary Policy Committee maintained the Monetary Policy Rate at 14% last week. Shares of Brvm-listed Ecobank Transnational were down by 8.6%.

Two Moroccan equities in the form of Lafarge and Douja Prom Adohha (a Moroccan real estate firm) lost 7.8% and 7.4% respectively over the week.

Topics: Ai Press Office, All Sectors |