Banking sector drives stock market in H1
Strong performance of the banking sector has driven the Malawi Stock Exchange (MSE) to close the first half positively as the overall measure of market performance gained 8.3 percent, MSE figures show.
The 16-counter market, which started the year on a subdued note, has registered strong showing from FDH Bank plc and other banks as key drivers that enabled the market to be buoyant at the end of June, pushing up the Malawi All Share Index (Masi).
Stockbrokers Malawi Limited equity investment analyst Kondwani Makwakwa said in an interview yesterday that in June, a 14 percent price gain in FDH Bank plc stock to K85.04 per share proved the banking sector’s continued domination at a time other sectors are struggling because of the impact of the 44 percent kwacha devaluation in November last year.
He said: “During the first half of the year, some sectors on the Malawi Stock Exchange have achieved significant performance, driving share prices upward.
“Notably, the banking sector, which constitutes a substantial portion of the MSE, has continued to perform exceptionally well. Recent trading statements indicate that most banks are set to outperform their half year performance compared to the same period 2023.”
Makwakwa said the outlook for the second half of the year remains positive, with most companies performing well and declaring favourable dividends.
MSE chief operating officer Kelline Kondowe said trading activity remained low for the great part of the half compared to last year, but expressed delight that investors are still getting returns from their investment.
She said: “When compared to last year, the market has slowed down in terms of both returns as well as activity on the market.
“However we are happy to see that investors are still earning positive returns on the market.”
During the same period last year most stocks also registered price increases that pushed up the Masi from 62 036.05 points to 108 656.97 points.
In a separate interview, Minority Shareholders Association of Listed Companies secretary general Frank Harawa said the first half market performance reflects market realities when compared with the same period last year when the market over-performed.
He said: “Although the market started badly in 2024 with most stocks losing value, we have seen improvements, especially during the latter weeks of the half where stockss such as FDH Bank and NBS Bank started gaining.
“This is a fair performance. Last year the market performance did wonders due to speculations where some share prices soared beyond their market value and we saw most stocks retreating in the second half, confirming the prices were to a certain extent high.”
Harawa expects the second half to be even better than the first.
