The regional stockmarkets have taken a hit from the weakening of currencies in the past nine months.

The biggest losers have been dollar investors, who have seen their portfolio earnings depreciate.

The Rwanda Stock Exchange (RSE) recorded the biggest loss for dollar investors, whose year to date fell 32.7 per cent followed by Nairobi Securities Exchange (NSE) at 25.1 per cent, and the Dar es Salaam Securities Exchange (DSE) at 23.9 per cent while Uganda Securities Exchange (USE) at 23.4 per cent.

DSE chief executive Moremi Marwa said that the listed companies’ valuations and trading activities have been affected by the depreciation of shilling against the US dollar.

The DSE All-Share Index dropped from 2,519 points in January to 2,470 at the end of September, despite rallying to 2,850 in mid-June. DSE has seen its total market capitalisation decline by 7 per cent, to $10.5 billion at the end of September.

The exchange has also seen a drop in its market liquidity (trading turnover) from $139.8 million at the end of June to $105.3 million at the end of September. The banking sectors, led by KCB and CRDB, were among the gainers in the last nine months with the former’s share price gaining 35.7 per cent while the latter saw its shares gain 12.2 per cent.

CRDB, Tanzania’s second-biggest lender by market value, in June raised $68 million through a rights issue floating 435.3 million shares at the DSE.

“We are using part of the rights offers proceeds to fund our expansion into DR Congo and Burundi. The rest will be used to shore up the core capital,” CRDB chief finance director Frederick Nshekanabo said.

Tanzania Cigarette Company (TCC) and Tanzania Portland Cement Company (TPCC) were among the losers at the DSE counter, with TCC seeing its net profit for the first half of the year decline by 4 per cent to $16.1 million due to the depreciation of the Tanzanian shilling and the carry-over impact of the 25 per cent excise tax increase in July last year.

TPCC also saw its profit for the first half dip from $12.8 million to $10.4 million due to the currency loss and the high cost of production.

Nairobi bourse

At the NSE, the All Share Index has dropped this year from 162.89 points at the start of the year to 144.04 points, data from Bloomberg Index shows. The market capitalisation also dropped from $25.5 billion at start of the year to $20.2 billion last week. Mid-year, it stood at $26 billion.

Despite the drop in market capitalisation, stocks in the insurance, banking, investment and energy sectors have rallied to register some gains in the nine months to September.

The top gainers were Safaricom at 23 per cent after clinching a security contract with the Kenyan government and its positive profitability outlook. Britam, buoyed by its real estate investments has seen a 39 per cent rise, leading CIC and Jubilee, which have recorded a rise of 12 per cent and 11 per cent respectively. In the banking sector NIC rose by 18 per cent and Equity bank by 14 per cent buoyed by the rollout of the Equitel service.

Geoffrey Odundo, NSE chief executive, said that the tough trading environment saw the turnover in equity trading remaining flat during the half year.

“This drop is largely impacted by the introduction of the capital gains tax in the early part of the year and the potential introduction of a transaction levy on marketable securities,” Mr Odundo said.

Kenya Airways remained one of the biggest losers, shedding 10.2 per cent of its share price, after announcing a $249 million full-year loss early in the year and last week a further $119 million half-year loss.

Kenya Airways finance director Alex Mbugua said they had improved their airlines operating loss position showing that the business was fundamentally on the right track.

“We are concerned about our negative equity position but are in discussion with the Capital Markets Authority with a view to rectify this,” Mr Mbugua said.

READ: Kenya Airways restructuring plan could propel airline out of the red

In the results released last week, the airline’s liabilities have risen to $2.09 billion against its total assets of $1.76 billion. This reflects a negative equity position of $339 million.

Energy

The USE All Share Index dropped rom 1,940.77 points at the start of the year to 1/738 points. The market capitalisation also dropped from $9.49 billion at start of the year to $7.08 billion last week.

The USE chief executive, Paul Bwiso, however said the exchange saw strong trading in the third quarter, improving by 20 per cent.

Mr Bwiso, attributed this improvement to the automation of the stockmarket.

Most of the counters were underperforming due to a weak shilling and a small margin of foreign participation in the trading.

The positive news from the Ugandan energy sector pushed Umeme’s stocks up by 24.3 per cent making it one of the top performing ones. Uchumi on the other hand continued its losing streak shedding 18.9 per cent in nine months.

“The falling currency and the elections are to blame for the poor performance of the Ugandan equity market. We hope that the increase of in CBR rates by Bank of Uganda will make the market attractive to portfolio investors,” analysts at Uganda’s Crested Capital said.

The Rwanda All Share Index (ALSI) dropped from 138 points at the start of the year to 132.23.

The RSE’s market capitalisation currently stands at $3.3 billion, up from $1.9 billion at the end of last year. The counters that have appreciated are Bank of Kigali at 9.4 per cent, while Bralirwa has appreciated by 3.6 per cent.