The Dar es Salaam Stock Market registered mixed results in this year’s quarter one as domestic market capitalization plunged and dividend yield surged.
DSE local market cap plunged by 3.0 per cent to Tshs 7.5trillion in quarter one in comparison to last year’s fourth quarter. And trailing weighted average dividend yield registered an increase of 0.2 percentage points to 5.6 per cent. DSE Chief Executive Officer, Moremi Marwa, attributed the domestic market cap drop yesterday to foreign investors’ activities and demand to fulfil social economic needs.
“This was a result of selling pressure emanating from social-economic needs during the quarter and decreased foreign investors activity,” Mr Marwa said on DSE CEO Quarterly Report. The bourse chief said apart from market cap decline, liquidity —trading turnover — decreased by 8.0 per cent to Tshs 75billion from Tshs 83billion in the quarter.
The Tanzania Share Index (TSI), the index that tracks domestic listed companies, also went down by 3.0 per cent from 3,677.82 points at end of December 2016 to 3,572.68 points at end of March.
However, the total market cap and DSE Index (DSEI), tracking performance of all listed companies, went up 5.0 percent in Q1 assisted by cross-listed counters. The DSEI increase pushed up total market capitalization from Tshs 19.12trillion recorded at the end of last December to Tshs 20.13trillion at the close of the quarter Q1 2017.
The DSEI moved from 2,198.40 points to settle at 2,315.06 points, a rise of 5.0 per cent. “There has been lesser than envisaged global growth in trading and investment activities, the collapse of commodity prices that affected many countries in the continent, as well as rising of debts for many African economies,” Mr Marwa said. On the valuation: Weighted Average market Price Earnings (PE) Ratio for domestic listed companies was trailing at 13.82 times compared with the trailing PE ratio of 14.04 times as of December 2016.
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