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Malawi Stock Exchange bullish in first half amid trade fall

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Noel Kadzakumanja

Financial market experts have described the Malawi Stock Exchange (MSE) as bullish in the first half of the year owing to a 9.32 percent rise in the return on investment compared to 8.49 percent recorded during the same period last year.

However, figures from MSE show that traded volumes and value registered a decline compared to a similar period last year.

For example, in the first six months of 2022, the market recorded 1,777 transactions where 278,145,868 shares were traded at a consideration of about K16.4 billion.

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The figures are lower compared to 704,867,651 shares traded and a consideration of K18.1 billion registered during the same period last year.

In an interview, MSE Chief Operating Officer Kelline Kanyangala said the market has performed well when compared to the same period last year.

She attributed it to improved performance of listed companies as the economy was opening up in the wake of easing Covid cases.

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“As you know, there have been quite a few developments within the macroeconomic environment which have heightened uncertainties of the economic outlook. It is not unusual in such circumstances for investors to take a wait-and-see approach so that they can make informed decisions.

“This could potentially be what we are seeing with the reduced activity on the market. Further to that, inflation has also eroded the disposable income of investors, thus not many would be able to participate as actively on the market,” Kanyangala said.

Stockbrokers Malawi Limited Chief Executive Officer Noel Kadzakumanja said, with a return of 9.32 percent, the market has performed better than last year despite reduced volumes, values and number of transactions traded.

“Among a number of challenges in the economy, which is still suffering from the effects of the Covid pandemic and the war in Ukraine, this performance is exceptional. Our anticipation is that we will close the year with a performance that is better than that of last year,” Kadzakumanja said.

In the second quarter alone, the market transacted a total of 166,088,409 shares at a total consideration of K11.9 billion in 929 trades.

However, the market registered a positive return on index as reflected in the upward movement of the Malawi All Share Index from 45921.23 points registered on April 1 2022 to 49596.14 points registered on June 30 2022, giving a return on index of 8.00 percent, compared to 7.93 percent registered in the second quarter of 2021.

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