The DSE edged up 89bps to 1297.3 as five counters made gains during the week. Tanzania Cigarette was the top gainer up 14.5% to TZS 3,000. Other stocks which gained were CRDB Bank (+1.4% to TZS 180), Swissport (+1.3% to TZS 800), Tanzania Breweries (+1.1% to TZS 1920) and TWIGA (+1.0% to TZS 2100). The week's top three traders were NMB, TWIGA and Swissport.

On the political scene, Tanzania's ruling party narrowly won a key parliamentary by-election after a tight race marked by low voter turn-out, pointing to a decline in popularity of the party even in regions where it has previously enjoyed strong support.

In economic news China and Tanzania have signed a USD 1bn loan agreement to build a major natural gas pipeline. The completion of the project will enable the 36-inch gas cylinder to produce 784m standard cubic feet of gas per day, capable of powering 3,900MW.

Eoin Treacy's view East Africa is more politically secure than much of the rest of the continent and manufacturing is slowly but surely gaining a foothold. China has not been shy about building relationships in the region and has been investing heavily in infrastructure across the continent.

Mrs. Treacy is currently in China. She met someone on the shuttle bus from the airport who lives in Tanzania. He was home in China having the long robes most men wear in Tanzania manufactured to order. He said that China is highly active in building relationships with the political establishment across the region and the number of expat Chinese in Africa is increasing. His business was flourishing and he said he was not alone. Most press coverage has focused on China's efforts to gain access to Africa's abundant resources. However, trade is not simply a one way conduit. Africa is also a destination for Chinese exports.

Small stock markets such as those in Africa tend to suffer during periods of heighted risk aversion. The African Opportunity Fund is currently trading at a 12% discount to NAV and is reasonably well diversified in terms of exposure to a variety of African countries. It hit a medium-term peak in February and still exhibits a downward bias. A sustained move back above 80p would question current scope for some additional lower to lateral ranging.