Firms’ annual earnings boost stock exchange
Malawi Stock Exchange (MSE) registered an increase in trading activity in May when 265 million shares changed hands raising K10.6 billion, a development analysts attribute to good companies earnings.
Share transactions increased from 80 million shares in April, raising K3 billion, representing a 228.45 percent jump in volumes and 188.65 percent in value, according to MSE Monthly Economic Report for May 2018.
Market analyst Armstrong Kamphoni said in an interview yesterday the performance of the listed firms drove trading activity in the period under review.
He said the demand by growing pension funds for investment in long-term assets could also have had an impact.
The local shares market registered a positive return on index of 10.89 percent, which is above inflation at 9.8 percent, as reflected in the upward movement of the Malawi All Share Index (Masi)—the overall measure of market performance.
This was pushed by gains in FMB Capital Holdings, National Bank of Malawi plc, National Investment Trust Limited, Press Corporation Limited plc, Sunbird Tourism plc, Standard Bank plc, TNM plc and Old Mutual plc.
Kamphoni said the outlook for the stock exchange looks promising as listed companies’ performance continue to impress on account of a stable macro-economic environment and pension fund contributions.
Another Blantyre-based market analyst said some investors are taking positions on some counters as well as opportunities available than the previous month.
“NBM bought 10 percent stake of Sunbird in May. TNM investors on the other hand are taking positions in advance of positive trading statement.
“It should also be noted that for Old Mutual, with the splitting of the company, some may see opportunities to buy the shares cheap on Johannesburg Stock Exchange compared to buying here,” he said.
MSE chief executive officer John Kamanga earlier said the 13-counter market is now moving towards the right direction.
“Last year we saw that there were good returns of about 62 percent and even this year, the returns on stock market will also be good anchored by positive results of listed companies,” he said. n
