Share this
As we navigate through the ever-evolving financial markets, staying updated with the latest investment recommendations is crucial. AIB-AXYS Africa has recently released their stock recommendations for March 2024, providing investors with insightful guidance on what to buy or hold.
Macro Review – February 2024
Kenya surprised the financial markets by partially buying back its scheduled 2024 Eurobond and simultaneously issuing a new $1.5Bn amortized Eurobond. The new 2031 Eurobond was sold at a discount of 97.270%, resulting in an effective yield of 10.375%.
The Kenya shilling strengthened by 10.7% against the US Dollar in February 2024, largely due to the successful early refinancing of the scheduled June 2024 Eurobond. This, coupled with high domestic real yields, led to a significant upswing in the Kenyan shilling.
Inflation rates softened to 6.3% in February 2024, primarily driven by a deceleration in food and fuel inflation rates. However, core inflation persisted at 3.6%, indicating ongoing price pressures in the real sector.
Equities Market Highlights
The market indices recorded an upward trend, pointing to a better outlook across the equities segment. Foreigners’ participation rate eased marginally to 60.0% of total market activity, but their trading turnovers significantly increased by 63.7%.
E.A Cables emerged as the highest capital gainer in February 2024, followed by Kenya Power and EA Portland Cement. On the other hand, Standard Group topped the list of capital losers, followed by Home Afrika and BK Group.
Stock Recommendations
AIB-AXYS Africa recommends buying shares of Co-operative Bank, Equity Group Holdings, Stanbic Kenya, NCBA Group, and Standard Chartered Bank. These stocks have shown strong return-on-equity, operational efficiency, and top-tier asset quality.
For investors looking to hold, ABSA Bank Kenya, Diamond Trust Bank (DTB-K), KCB Group, and Bamburi Cement are recommended. These stocks have demonstrated robust growth and resilience despite the challenging market conditions.
Upcoming Earnings Season
Investors should anticipate the release of full-year 2023 results for the Banking and select Insurance sector counters, alongside Bamburi Cement. Mixed results are expected, marked by a flurry of dividend payments across various counters.
Investing wisely requires keeping a close eye on market trends and expert recommendations. As we move into March 2024, consider these insights from AIB-AXYS Africa to make informed investment decisions.
