The Tanzania Share Index (TSI) has recorded a new milestone after breaking past the 4000 points mark for the first time since September 2018, closing at 4000.9 points.
This new milestone is a clear indication of the growth and stability of the Tanzanian economy, which has been boosted by positive earnings from some of the country’s largest banks.
For starters, the Tanzania Share index is a statistical measurement of the performance of domestic stocks listed on the Dar es Salaam Stock Exchange (DSE) and it provides investors with a snapshot of the performance of the domestic market. A growing economy typically leads to higher profits for companies, which in turn can drive up stock prices and cause a stock market index to gain points.
Two of the biggest contributors to this growth are CRDB and NMB, who have recently disclosed their year-on-year growth in net profit. CRDB reported a growth of 31% while NMB reported an impressive 46%.
This growth in profit is a testament to the sound management and strategic investments made by these banks, which have allowed them to continue to thrive even in challenging global economic conditions experienced last year.
The staller performance of CRDB and NMB has not gone unnoticed by investors, who are now rushing to buy their shares. The demand for these shares has driven up their prices, and this has been reflected in the stock market. The share price gains of 7.9% (CRDB) and 22.86% (NMB) realized since the turn of the year, are a clear indication of the level of confidence that investors have in these banks and their future prospects.
Overall TSI has been experiencing a steady increase in recent months, which has helped it to reach its current high level. Registering an impressive 9% year-year growth in 2022, clearly swimming against the global tide of macro-economic uncertainties and sell-offs.
This growth in the TSI is expected to continue, as more and more investors seek out opportunities in the Tanzanian market. This presents a unique opportunity for both local and foreign investors to benefit from the economic growth and stability that the country is currently experiencing.