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Earnings from investment in the money market instruments, the Malawi Government Treasury Bills (TBs) and Reserve Bank of Malawi (RBM) Bills, continue to decline, a Malawi Stock Exchange (MSE) weekly report indicates.
In its report for the week ended November 28, MSE said at the auction held on November 21, the average yield on the 91 days TB decreased from 38.05 percent to 36.67 percent while that for the 182-day TB dropped from 39.34 percentage points to 38.06 percent.
On the other hand, the 273 days tenor decreased from 39.42 to 37.72 percent, said the report.
MSE also quoted RBM as reporting that in the RBM bills primary market, whose auction was held on November 18, the 63-days RBM yield decreased from 38.38 percent to 35.82 percent and the 91 days tenor yield also decreased from 39.25 percent to 37.88 percent.
MSE operations manager John Kamanga said last week news of expected aid inflows to Malawi and the subsequent reduction in the RBM lending rate to commercial banks have resulted in declining yields for money market instruments, a development which has made the capital market more attractive to investors.
“Returns from the money market instruments are going down and the most attractive avenue to invest now is the capital market,” he said.
And in its trading commentary for last week, MSE said the market recorded trading activity in four counters—Stanbic, National Bank of Malawi, Sucoma and Old Mutual plc.
However, it was Sucoma shares whose share price increased from K3.65 to K3.85 that moved the Malawi All Share Index (Masi) to 457.31 from 457.22 percentage points.
“This [going up of the Masi] is on account of an increase in the Domestic Share Index by 3.04 percentage points from 227.82 to 230.87 points due to an increase in the share price of Sucoma from K3.65 to K3.85,” says the report.
During the week, a total of 299.903 shares were transacted at a total consideration of K12.2 million in 10 deals.
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