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Seven-year bond yields expects to increase

Weekly outlook

In the coming week, we still prospect that the market will remain vibrant going forward specifically on the banking sector.

We have witnessed share price movement and increase market activities in the local counters which amplifies that there is investors’ appetite that will drive more market activities during the week.

The market will remain active during the week and mainly from the top local active counters.

CRDB, NICOL and JATU are likely to be the most active counter, and this has been due to their liquidity in the market in terms of easy entry and exit.

Other top counters expected to transact during the week include TPCC, TCCL DSE and TCC as they have announced dividend for year 2020. In midweek, we expect a 7 Year Treasury bond Auction by the central bank.

The appetite for government treasuries has been increasing, with the medium-term instruments we still expect over subscription and slightly increase in weighted average yield from the previous auction held 21st October 2020.

In the interbank cash market, despite the decrease in the Weighted average rate (WAR) during the previous week, we still reiterate anticipate that WAR will continue to be stable and within a range of 3.50 per cent to 4.00 per cent with slight volatility in the high and low rate.

The Bourse

During the week, Total Market Capitalization declined by 0.17 per cent to close at TZS 15.61 Trillion from TZS 15.64 Trillion in the previous week mainly due to decrease in share prices of cross listed firms at the bourse.

JHL share price decreased by 3.25 per cent to close at TZS 5,950, KCB share price decreased by 2.27 per cent to TZS 860, NMG share price decreased by 9.09 per cent to TZS 350 and JATU share price decreased by 6.41 per cent to TZS 1,460.

On the other hand, EABL share price increased by 0.56 per cent to TZS 3,620 and CRDB share price increased by 6.98 per cent to TZS 230, and this affected domestic market capitalization to slightly increase by 0.42 per cent to TZS 9.24 trillion.

TSI slightly gained 0.27 per cent to close at 3,512.78 points, DSEI lost 0.25 per cent to close at 1,878.46 points, Bank, Finance and Investment Index (B&F) gained 1.37 per cent to close at 2,437.22 points, Industrial & Allied (I&A) slightly lost 0.016 per cent to close at 4,814.08 points.

On the contrary Commercial Services (CS) remained stationary to close the week at 2,139.33 points. Total Volume of shares traded decreased by 50 per cent to 1,478,747 traded in 160 deals from 2,967,183 traded in 181 deals.

Total turnover for the week rallied northwards after recording an increase by 86.64 per cent to TZS 3.15 Billion from TZS 1.69 Billion in the previous week.

TCC transacted shares worth TZS 1.96 billion which is 62.07 per cent of the total turnover, NMB counter transacted shares worth TZS 850.11 Million which is 26.92 per cent, TBL transacted shares worth TZS 135.41 Million, CRDB transacted shares worth TZS 113.92 Million, TCCL transacted shares worth TZS 53.49 Million, TPCC transacted shares worth TZS 31.89 Million, JATU traded shares worth TZS 6 Million, NICOL transacted share worth TZS 3.64 Million, DSE traded shares worth TZS 1.58 Million, VODACOM transacted shares worth TZS 1.21 Million, SWIS transacted shares worth TZS 0.33 Million, TTP transacted shares worth TZS 70,800.00, DCB transacted shares worth TZS 50,400.00, SWALA transacted shares worth TZS 9,000.00 while PAL lagged behind with TZS 7,200.00.

Interbank market

During the week, the Interbank Cash Market (IBCM) recorded a total transaction value of TZS 24.00 billion being an increase from last week’s TZS 10.30 billion.

The weighted average rate (WAR) decreased to close at 3.50 per cent from 4.00 per cent in the previous week. The highest and lowest rate was 4.50 per cent and 3.50 per cent similar to previous week.

Debt Market

In the debt market, outstanding government bond listed at the bourse stood at TZS 13.30 trillion.

On the Secondary market, the government bond segment transacted TZS 38.11 billion whose face value was TZS 37.36 billion from last week’s TZS 57.32 billion and face value of TZS 53.56 billion.

For the Corporate bonds, the market transacted bond worth TZS 38.89 million with face value of TZS 43.00 million.

During the week, the central government in line with its debt issuance plan sought to raise total of TZS 90.23 Billion from the public through a treasury bill. The auction was oversubscribed by TZS 59.2 Billion. The central bank pocketed total of TZS 125.31 Billion.

WAY for 182 days, and 364 days WAY was 3.91 per cent and 6.02 per cent respectively. WAP for 182 days, and 364 days was 98.09, and 94.33, respectively.

While 35 days and 91 days attracted no bids during the auction.

Interbank Foreign Exchange

Market Total volume in the Interbank Foreign Exchange Market decreased to USD 3.60 Million from USD 3.82 Million in the previous week. TZS/USD remain strong to close the market at TZS/USD 2,309.96 similar to previous week.

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