DSE up as supply increases

Dar es Salaam. The weekly turnover at the Dar es Salaam Stock Exchange (DSE) rose by 28 per cent last week amid a continuous rise in supply as the economic situation bites, market data show.

Faced by a challenging economic situation – fuelled by the government’s decision to implement a number of austerity measures – the supply of shares has been high at the DSE for a couple of months as some investors sell some of their stocks to offset the biting economic situation.

As a result, prices for some stocks have been going down during the past few months.

“For some months now, many investors are selling their stocks and this is quite unusual since normally, supply increases rapidly between November and December when investors start looking for money so they can attend to their year-end and year-year obligations. This year’s trend would explain the fact that most people do not have money so they sell their assets to get some cash,” said an analyst with Tanzania Securities Limited, Ms Lina Charles Maswi.

For almost one year now, the government – which does business with most investors - has been on a cost-cutting exercise that has seen ministries, departments and agencies holding their meetings and conferences in their boardrooms or in publicly-owned institutions instead of conducting them in hotels and in other privately-owned facilities.

And last week, some Sh3.817 billion was realised in market turnover, up from Sh2.989 billion that was registered during the preceding week.

During the week – which also saw no major movement in stock prices – a total of 9,863,195 shares exchanged hands, up from 529,852 shares which were transacted during the preceding week.

Analysts are however optimistic that things may improve this week as investors’ liquidity levels improve during the end of the month.