GhanaKenyaNigeriaPan-Africa

13 May 2024

IC The Week Ahead

In brief

Ghana

  • The GSE-CI remained unchanged at 3,646.9 points last week, leaving the year-to-date and 30-day returns at 16.5% and 5.5% respectively. The stability of the index is attributed to steady price changes for a few stocks with no significant  weight to noticeably influence the index direction.
  • Aggregate market turnover spiked by 256.1% w/w to USD 0.5mn, with Scancom Plc dominating trading activity, accounting for 97.2% of the total value traded. Market breadth favoured decliners with a 3:0 ratio. No gainer was recorded for the period, while Calbank Plc (-7.9% w/w | GHS 0.35) was the worst laggard.
  • Ghana’s April 2024 CPI inflation decreased by 80bps to 25.0% y/y, slightly below our projected decline. However, month-on-month inflation rose by 100bps to 1.8%, driven by Cedi depreciation and fuel price increases. Food inflation slowed to 26.8% y/y, while non-food inflation unexpectedly rose to 23.5% y/y, mainly due to energy price spikes. Favorable base effects may lead to a faster disinflation in May 2024, despite upward pressure from currency depreciation and fuel prices. Also, the Ghana Stock Exchange launched the commercial paper market on Friday, May 10, 2024. On Monday, May 13, 2024. the GSE will conduct a listing by Introduction of Atlantic Lithium.

Nigeria

  • The NGX-ASI declined by 1.4% w/w to settle at 98,234.2 points, bringing the year-to-date return to 31.4% and 30-day loss to 6.1% . The bearish movement in the index was underpinned by losses in mid-to-large caps.
  • Aggregate market turnover surged by 57.9% w/w to USD 34.8mn, with United Bank for Africa Plc dominating trading activity, accounting for 23.3% of the total value traded. Market breadth remained balanced with an equal number of gainers and decliners. Tantalizers Plc (+27.8% w/w | NGN 0.5) led the gainers’ chart, while  Vetiva S&P Nigerian Sov Bond (-42.0% w/w | NGN 200.0) was the worst laggard.
  • The Central Bank of Nigeria has extended the suspension of processing charges on cash deposits exceeding NGN500,000 for individuals and NGN3,000,000 for corporates until September 30, 2024. Financial institutions regulated by the Central Bank of Nigeria are required to accept all cash deposits from the public without imposing any charges during this period. However, the CBN has issued a directive for the implementation and remittance of a 0.5% cybersecurity levy on the value of all domestic electronic transactions, albeit with some exemption to avoid multiple application of the levy on the same transaction.

    Kenya

  • The NSE-ASI increased by 1.8% w/w to settle at 106.5 points bringing the year-to-date returns to 15.6% and 30-day loss to 5.8%. The upward movement in the index was due to gains in mid-to-large caps.
  • Aggregate market turnover surged by 75.5% w/w to USD 8.6mn, with Equity Group Holdings Plc dominating trading activity, accounting for 25.2% of the total value traded. Market breadth favoured decliners with a 57% ratio. HF Group Plc (+17.1% w/w | KES 4.4) led the gainers’ chart, while  Standard Group Plc (-9.5% w/w | KES 5.7) was the worst laggard.
  • Safaricom published its FY2024 results, with earnings surpassing estimates by 6.7%, driven by stronger-than-anticipated service revenue, which exceeded expectations by 4.6%. Service revenue increased by 13.0% y/y, largely driven by M-Pesa (+19.0% y/y) and mobile data (+18.0% y/y). Total revenue rose by 12.0% y/y to KES 349.4bn. However, profit before tax declined by 4.0% y/y to KES 84.7bn. On the macro front, Finance Bill 2024 was submitted to the National Assembly for consideration and passage ahead of the upcoming FY24/25 fiscal year. Among other tax measures, the Bill seeks to impose VAT on banking services as these services will no longer be VAT exempt. Also, an “eco levy” has been proposed in the Bill to be imposed on a raft of products, especially machines. While these tax measures could potentially boost the Treasury’s revenue collection towards meeting the IMF programme revenue targets, we foresee upsurge in operating cost for businesses, especially in services, manufacturing, and commerce.

 

 

 

 

 

 

 

 

 

 

 

 

 


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