DSE investors optimistic despite liquidity drop in May

Dar es Salaam. Despite an 87 percent drop in total market liquidity for the month of May, investors maintain a positive sentiment that the Dar es Salaam Stock Exchange (DSE) will do well in June.

The bourse recorded a total transaction turnover of Sh2.18 billion in May.

This was an 87.47 percent decrease from a turnover of Sh17.4 billion that was registered in April, according to the Zan Securities Limited’s monthly outlook.

However, positive price movements and progressive active participation of investors gives hope for the market in June.

Speaking to The Citizen, the firm’s chief executive officer, Mr Raphael Masumbuko, said with the year about to reach end of the first half, there was a potential for returns regardless of the volatility of the market.

“We have experienced many inquiries from investors and this shows that the appetite is high for both equities and long term securities. We see both compelling opportunities in the stock market and potential for a solid year of returns, attributed by steady growth of DSE All share Index and Tanzania Share Index,” he said.

In May, CRDB Bank Plc held the largest market share. It traded Sh1.24 billion followed by TBL Plc which traded Sh200.84 million, and self-listed DSE with Sh149.31 million.

Other active counters included Twiga Cement which traded a turnover of Sh137.97 million, TCCIA Investment Company Limited (TICL) with Sh62.84 and NMB Bank Plc which recorded a turnover of Sh61.64 million.

In the bond market segment prices still hover at historically high levels attributed by increased liquidity from investors.

The primary market remained very active with aggregate volumes of Sh468.9 billion collected from investors arising from the auction of the 7 year Treasury bond and 20 year Treasury bond, Zan securities reports.

“The Bond markets will be earmarked by high bond prices and relatively low yields attributed to increased liquidity,” said Mr Masumbuko.

The 20-year Treasury bond was issued with a coupon rate of 15.49 percent and fetched a weighted average price of 100.46 with 15.41 percent weighted average coupon yield.

While the 7-year Treasury bond was issued with a coupon rate of 10.08 percent fetching a weighted average price of 99.71, and weighted average coupon yield of 10.1 percent.