The Malawi Stock Exchange (MSE) was bearish in the first quarter (Q1) as it registered a negative return on investment of negative 3.56 percent, a market report has shown.
However, on a year-to-year basis, the return on investment is higher than what was achieved during the same period last year at negative 5.8 percent.
The sluggish performance was seen in the downward movement of the Malawi All Share Index (Masi)—the measure of local shares market performance—from 30252.20 points registered in January to 29176.23 points in March, according to the Q1 market performance report.
Says the report: “The price gains registered on Airtel at 37.9 percent, Mpico at 28.01 percent, Nitl at 18.75 percent, NBS Bank at 18.52 percent, NBM at 2.86 percent, Sunbird at 1.7 percent and Standard at 0.001 percent were not enough to offset share price losses registered by five counters.”
In the quarterly report released on Monday, the MSE attributed the price losses in TNM by 1.77 percent, FMBCH by 46.67 percent, Illovo by 38.24 percent, Icon by 0.10 percent and BHL by 0.08 percent as the key drivers in the downward movement of the Masi.
During the review period, the market transacted 70 million shares at K1.8 billion in 761 trades, lower than 420 million shares transacted at K14.1 billion in 721 trades in the corresponding period of 2019 which reflects an 83.15 percent decrease in volume and an 87.13 percent decrease in value.
MSE performance has lately been poor as evidenced by the 4.77 percent drop in value last year from K46.8 billion the year before.
A Blantyre-based market analyst who told Business News on Monday that counters that have contributed to the decline are large as such the performance was anticipated.
In its Q1 review report issued on Monday, investment and advisory firm Cedar Capital Limited also indicated that the market was reacting to available trading and financial statements from the listed companies.
MSE operations manager Keline Kanyangala is, however, upbeat 2020 will be a good year for the MSE as it builds momentum and brings more listing on the local shares market.