Thursday, February 22, 2024

The Stock market maintains momentum into Q3:2021

The Botswana Stock Exchange (BSE) retained its strong momentum in the first month of the third quarter, narrowing losses that have been the norm in the six years.

From January to July 202, the Domestic Company Index (DCI) – which tracks share price performance of the 24 listed companies on the domestic counter – depreciated by 2.5 percent compared to a 5.3 percent loss in the same period in 2020.

The DCI has kept the momentum from the second quarter of 2021 after gaining 1.4 percent, making a comeback from the 5.1 percent depreciation in the first quarter of the year.

The Domestic Company Total Return Index (DCTRI), which includes dividends in calculations, appreciated by 0.7 percent, a major reversal from the 2.3 percent reduction in the same period last year. The DCTRI ended the second quarter of 2021 up 4 percent, better than the 4.4 percent decline in the first quarter.

In the first seven months of the year, a total equity turnover of P370.7 million was recorded from traded volumes of 267.0 million shares compared to P405.3 million recorded from 174.9 million shares in 2020, according to data from the market performance report released by BSE on Monday.

The top three traded companies during the period under review were Letshego (P67.2 million), FNBB (P51.9 million) and Sefalana (P50.1 million). The total turnover from these 3 companies accounted for 45.7 percent of total equity turnover, with the leading counter Letshego accounting for 18.1 percent of total equity turnover.

Of the 30 listed companies, thirteen recorded depreciation share price, ten registered gains, while seven experienced no share price change.

The top gainer was energy explorer Tlou as its share price soared by 51.5 percent, followed by Seed Co and Lucara with gains of 45.9 percent and 41.9 percent respectively. Sechaba experienced the biggest decline in share price of 21.1 percent, followed by Turnstar and Absa with declines of 20.8 percent and 17.8 percent respectively.

The resurgence in the BSE’s benchmark index will calm investors who been monitoring the decline in market capitalisation since 2015.

The DCI fell by 11.3 percent in 2016, before recovering slightly in 2017 with a 5.8 percent loss but and continued to stumble over the years, with losses averaging 11 percent. In 2019, the DCI narrowed losses to 4.6 percent and while 2020 begun strongly for the BSE, it ended the challenging year with the index down by 8.2 percent.


Read this week's paper