Rwandan and Tanzanian stockmarkets ranked among Africa's top six performers – ZAWYA
Rwanda Stock Exchange and Dar es Salaam Stock Exchange registered 7.2% and 9.1% returns respectively
Rwanda and Tanzanian stockmarkets rank among the six top bourses in sub-Saharan Africa that have weathered economic storms to post positive returns to shareholders.
A quarterly market report by analysts at AfricanFinancials Group shows that Rwanda Stock Exchange (RSE) and Dar es Salaam stock Exchange (DSE) registered 7.2 per cent and 9.1 per cent returns respectively during the 12 months period to June this year.
The report dubbed Sub-Sahara Africa Top 30 Companies (excluding South Africa) shows that other African exchanges that performed well during the period included Nigeria which recorded a return of 20.9 per cent , Zambia (12.1 per cent), Seychelles (five per cent) and Botswana (2.8 per cent).
The report dated July 2022 shows that between June 2021 and June 2022, investors on the Nairobi Securities Exchange (NSE) and Uganda Securities Exchange (USE) lost 28.2 per cent and 20 per cent of the value of their investments, respectively.
In the month of June, Kenyan stock market dipped by 4.3 per cent, while Tanzania and Ugandan markets declined by 0.7 per cent and three percent respectively. Rwandan stockmarket, on the other hand gained one percent during the month (June).
Activities on the DSE increased by 9.8 per cent during the five months period to May this year as the new administration under President Samia Suluhu embarked on a massive policy shift aimed at attracting investment in the country.
In early June, the Bank of Tanzania (BoT) relaxed rules allowing, for the first time, investors from the East African Community (EAC) and Southern African Development Community (SADC) to trade in Treasury bills and bonds issued in Tanzania.
Tanzanian stock market whose market value stands at around $4.4 billion grew by 9.8 per cent between January and May, followed by RSE which grew by 6.1 per cent.
On the other hand, the Nairobi Securities Exchange (NSE) and Uganda Securities Exchange (USE) fell by 25 per cent and 17.6 per cent respectively during the period under review.
In the month of May, DSE and RSE grew by 2.2 percent and 2.6 percent respectively while the NSE and USE fell by 14.5 per cent and 6.9 per cent respectively. The Nairobi bourse is the third worst-performing major stock market in Africa since January, hit by foreign investor capital flight and ease of repatriation of equity sales compared with other capitals in the continent.
NSE was ranked eighth among the 10 top stock markets in the continent with a return of negative 30 per cent in dollar terms since the year started.
The performance of African stock markets has been weighed down by a reduced appetite for emerging markets after a jump in interest rates in the developed markets such as the US, which are currently battling high inflation that has forced their central banks to adjust rates upwards.
The situation has been exacerbated by the events in the local environment including soaring debt levels, rising inflation, weakening currencies and high fuel price as a result of the supply chain disruptions caused by the Russia-Ukraine war and elections fears in some countries such as Kenya.
According to the National Bank of Rwanda the global economy entered 2022 in a weaker position than previously expected, undermined by the Omicron Covid-19 variant.
Rising energy prices and supply disruptions have resulted in higher and more broad-based inflation than anticipated, notably in the United States and many emerging markets and developing economies.
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