Domestic Bonds

Tanzania: Dse up in January at the expense of the bond market

The Dar es Salaam Stock Exchange’s Tanzania Equity Index (TSI), measuring the depth of local equity activity, rose 126.97 points, driven mainly by the banking and industrial sectors in the first month of this year. .

The TSI is also believed to have performed well in January after primary market treasury yields fell, leaving investors with a limited alternative to looking for stocks.

Market data showed the TSI closed at 3,692.15 after rising 0.88% last week.

Weekly market recaps from Zan Securities showed that the equity market rose remarkably in January, driven by falling long-term bond yields 15, 20, 25 years.

“With yields falling in the fixed income market, the equity section of the capital market performed well in the first month of the year…” the Zan report said.

The All Share Index (DSEI) also rose 0.66% to close at 1,935.29 points.

“… Stocks such as CRDB Bank are up 26.78% year-to-date, showing signs of impressive activity for the rest of the year.” Zan report showed.

Price movement for the week ending last Friday was seen in Simba Cement stock rising 10% to 1,100/-, followed by CRDB up 9.23% to close at 355/- per share, NICO up 3.33% to 310/- -per share and the self-listed DSE also gained 1.52% to 1,340/- per share.

On the other hand, Jatu share price fell 5.13% at the end of the week to 370/- per share.

Total market cap was on the green note up 0.66% to 16.131 tri/- and domestic market cap also rose 0.88% to close at 9.761 tri/-.

Vertex International Securities said in its weekly market review that the equity market echoed its sentiment from last week, having projected continued positive performance.

“We plan [last] the positive momentum from the week will continue into next week as we expect buyers to overwhelm sellers,” Vertex said.

The DSE stock market continues with a positive and bullish performance this week, posting a turnover of 4.69 billion/-, 21% more than the previous week.

The two pre-arranged block deals dominated market share last week, led by CRDB controlling 63.22% of all deals, followed by TBL at 29.19%.

Last Wednesday, the Bank of Tanzania reopened a 13.5% 15-year Treasury note that was first issued last June, offering 136 billion euros to investors.

The bond was oversubscribed by 276% at 376 billion/- but the central bank accepted 160 billion/-, which is the highest subscribed for the 15-year Treasury bond auction so far.

“The auction outcome appears to be a consequence of low yields on the long end of the curve…we see [108/60] have a ripple effect on the respective paper in the secondary market,” Zan said.