For the week ending Monday 11th August 2003, the local bourse witnessed some volatility but finished the period slightly higher. All three equity indices, the broad Semdex, the Sem-7 and the total return index SEMTRI, gained

0.3 %. The total trading turnover on the official market for the week slipped by 23.4 % to Rs72.4m.

Trades on The Mauritius Commercial Bank Limited (MCB) accounted for 72.1 % of the total trading turnover amid MCB?s share buy-back scheme. However, as per regulations, MCB halted its buy-back programme during the week under review prior to the forthcoming release of its financial results. In a press communiqué of the 7th August 2003, MCB informed the public that Mr. Philippe A. Forget would reintegrate the bank?s management team.

Shares of MCB remained stable at Rs 26.80. Shares of the other listed commercial bank, the State Bank of Mauritius Ltd. (SBM) remained under pressure, as it ended the week down by 1.3 % to Rs14.80. After its recent sell-off, analysts noted that SBM?s attractive historic price-earning-ratio (PER) of 5.6x and dividend yield of 7.2 % (dividend of Rs1.10 per share recorded for December 2003) may provide support.

Last week, the different economic sectors a posted mixed performance. The top performers of the week were the sugar (+3.3 %), commerce (+0.7 %) and investments stocks (+0.5 %). The only gainer among the sugar stock was Mon-Trésor- Mon-Désert, the fifth largest listed stock, which rose by 4.7 %. The latest estimates released by the Mauritius Chamber of Agriculture indicated that the sugar production would reach 540,000 tonnes instead of the initial forecast of 570,000 tonnes.

Shares of commerce conglomerates Rogers & Co. Ltd and Ireland Blyth Limited rose by 2.3 % and 1.6 % respectively, whereas Courts Ltd. slipped by 1.4 % to Rs 3.45 on profit taking. Last week, the decline of Automatic Systems Ltd. (-1.6 %) and Sun Resorts Limited (-0.2 %) weighed on the hotels&leisure sector, which edged 0.1 % lower.

Another negative piece of news was the International Monetary Fund?s assessment of the Mauritian economy. In its note, the IMF estimated that the country?s real gross domestic growth (GDP) would drop to 3.3 % for the year ended 30th June 2003, from the 4 % growth recorded in the 2001-02. Commenting on the health of the Mauritian economy, the IMF observed that the export processing zone and the tourism sectors may suffer from a weak global environment.

However, the construction and financial services sectors are expected to post a robust performance for the year 2002-03. Among the concerns cited by IMF were the rising unemployment rate (estimated at 10 % of the workforce), the high level of the Government budget deficit (close to 6 % of GDP) and short-term risks faced by public finances amid highly indebted state-owned enterprises (namely the Central Electricity Board and State Trading Corporation).

Contribution by Confident Asset Management