The DSE?s Tanzania shareindex (TSI), that measures domestic companies, climbed to new all-high level in October 22, 5831.07 points compared to 2843.5 points at the beginning of the new The TSI, according to stock analysts, was pushed up by demand driven by central bank, Bank of Tanzania, announcement and opening of the capital account?the index almost double.
The Zan Securities, Chief Executive Officer, Mr Raphael Masumbuko, said the capital account pushed price up as regional investors believe DSE stock prices were low compared to other bourses in the region.
?Investors anticipating a bullish trend thus rush to buy as a result push prices to new levels,? Mr Masumbuko told ?Daily News?.
However, the TSI plummet to 4526.61 points of December 24, the lowest level in a threemonth and half. On other hand, the DSE all share index (DSEI) gained by 845.77 points to reach its historical high of 2715.95 points of mid October.
The index, however, dropped to 2493.29 points of December 23. Tanzania Securities Ltd, Research and Dealing Officer, Mr Innocent Massawe said in a last week report that since trading move close to the end of year holidays, the stock market plummeted.
?We expect to see low activity in the coming week with continuous price fall in some counters as some investors will be desperately in need of cash to cover their holiday expenses,? Mr Massawe said.
Mr Massawe said in the report that end year investors? obligation, put money market at a tight liquidity trend that affects the equity market as well.
But National Microfinance Bank said in Wednesday report that the local money market ?signals healthy liquidity?. The T-bill auction last week was slightly oversubscribed by over 31bn/- with an upward movement of weighted average rate for each tenor.
On the other hand the Wednesday 15-year bond undersubscribed for the second time, largely due to liquidity squeeze in the circulation. A total of 25bn/- was sought to be raised but BoT ended up fetching only 14.35bn/- as the amount tendered.
Source Tanzania Daily News