After flirting with the skies, crossing the mythical threshold of 12,000 billion CFA francs in market capitalization, the Regional Stock Exchange (BRVM) is experiencing a backlash. In the week of August 4 to 10, there is a brutal drop towards the 10,000 billion mark. The correction is orchestrated by a targeted defiance towards financial heavyweights and utilities.
The flagship indices are eroding: BRVM Composite (-0.44% at 311.72 points), BRVM 30 (-0.48%) and BRVM Prestige (-1.05%). Investors are arbitrating without mercy, letting go of financial stocks and accumulating industrial ones.
The low liquidity testifies to the wait-and-see attitude. Only 4.16 million shares were traded (-78.56%), for 4.59 billion CFA francs (-47.28%).
In this transactional desert, Sonatel captures 29% of the total value of trades and regains its crown, while SAFCA CI surges (+31.40%) and SETAO CI crashes (-7.56%).
The bond market, on the other hand, falls to 10,522.75 billion CFA francs (-0.31%), with SOVATEL 6.50% 2020-2027 leading the trade (62.12% of volumes), despite a plunge in transactions (-59.90%).
On the sovereign primary market, appetite returns: 206 billion CFA francs raised (+108.85%), led by Côte d’Ivoire, with an average yield of 7.10%, while Guinea-Bissau secures a premium with 9.56%.
On the corporate side, Ecobank Transnational Incorporated sells its Mozambican subsidiary to FDH Bank Plc (Malawi), refocusing its portfolio, an information that did not boost the value of this bank in line with its geographic size. The suspension of Unilever CI since August 4 continues to fuel market rumors. Information suggests imbalances between buy and sell orders. The stock has risen by 700% since the beginning of the year, while its latest financial statements published on the BRVM website date back to the 2023 fiscal year.
Meanwhile, pending explanations from the BRVM or the UEMOA regulator (AMF), it must be said that the low volumes facilitate price manipulation. Furthermore, NSIA Banque CI has successfully completed its pioneering 50 billion CFA franc multi-currency securitization, fully absorbed by the market. A week that reminds us of the golden rule of marketplaces: after the euphoria of peaks, beware of the hangover of corrections.
