DSE trading to remain low till election - broker

The Dar es Salaam Stock Exchange,(DSE) is experiencing low turnover from foreign investors as the country is heading towards general election to be held ten days later from Thursday.

The trading data from the bourse show that foreign participation on buying side, since the beginning of this month stands at 38.11 per cent or a turnover of 7.81bn/-. 

This is contrary to the July-September participation margin of 88.46 per cent that contributed to the turnover of 196.6bn/-.

The Tanzania Securities said in its latest weekly report that they expect the market activity for next week to follow the same trends as the previous two weeks—low turnovers.

“We anticipate foreign investors’ participation to remain low until after elections,” it said.

However, on the selling side, foreign investors seem to be pulling out ahead of the Election Day as selling activities increased reaching 44.4 per cent since the beginning of October. This is against the July-September when the selling was merely 7.8 per cent.

But shilling here might be also the factor of sale-hold. The low turnover from foreign investors had a negative impact as total market capitalization dropped to 20.94tri/- of Tuesday from 22.16tri/- at the end of last month.

The same had its toll to domestic market caps after registered a 9.79tri/- as of Tuesday against 9.81tri/- of end of last month. 

The indices were not spared as both market shares (DSEI) and Tanzania all shares (TSI) fall slightly to 2,390.72 points and 4,623.55 points from 2,531.08 points and 4,631.91 points respectively.

This is not the first time DSE trading dipped prior to General Election. Similar trend was observed in 2010 but stock experts ruled out the direct link between election and the bourse trading.
Source: Daily News, reported from Dar es Salaam, Tanzania
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