The NSE 20 share index has fallen to its lowest since 2009 to 3,047 points as a result of what has been termed as a dip in blue chip counters.
According to INVESTOPIA a blue chip is a nationally recognized well-established and financially sound company. Blue chips generally sell high-quality, widely accepted products and services and the often operate profitably in the face of adverse economic conditions. The fall in the NSE 20, therefore, has been attributed to the fall in the established and financially sound companies listed at the NSE.
According to the statistics at the NSE, the total market cap was at 1.82 trillion shillings on Wednesday, low from 1.93 trillion shillings that was recorded at the start of 2017. In 2016, the stock exchange dealt a blow to investors after it recorded a drop of 120 billion shillings from their wealth.
In yesterday’s trading, the stock market shed off 1.2 percent of points of the total capitalization. In the trading, only five stocks experienced a gain in the share prices with the remaining 58 either registering a drop or maintaining the initial prices. The gaining stocks on Wednesday were Kenya Re-Insurance with 3.41 percent, the East African Portland Cement with 3.23 percent, Standard Chartered Bank with 2.22 percent and Sameer Africa and CIC Insurance Group with 1.82 and 1.30 percent respectively.
Currently, East African Breweries Limited is trading at its three year low of 223 shillings per share, British American Tobacco at 850 shillings per share having lost 5.6 percent with others like Safaricom Limited, Equity Bank Group and Cooperative Bank of Kenya having recorded a drop in their values giving a rather dark future for the NSE.
On Wednesday, the most traded in shares came from Safaricom Limited which posted a volume of 16.38 million, Kenya Re-Insurance which posted 4.04 million, Kenya Commercial Bank with 2.97 million, Mumias Sugar Company with 1.21 million and the then East African Breweries with 385,400 in volume.