The equities segment continued to slip to a 10-month low, as investors lost due to currency fluctuation, price correction and capital gains tax.
The NSE-20 share index cutback 3.17 points to 4853.44 points as the NSE All Share Index (NASI) shed 0.82% to 162.80 points to peg the YtD return at -1.46%. Market capitalization followed suit losing by 0.82% to close at KES. 2.277Tn as equity turnover gained by 36.41% to 976.32Mn. The market breadth illustrated the indices performance as 25 stocks declined and only 16 advanced, emphasizing a 1.56x ratio. Centum Investment Co Ltd (NSE: ICDC) and Kenya Commercial Bank Ltd (NSE: KCB) were the most actively traded counters today, accounting for 67.39% of total value traded.
As the week begins to take shape, the Kenya Revenue Authority’s (KRA) war with stockbrokers over the payment of capital gains tax (CGT) intensified. Only half the brokers remained in compliance- following the Thursday deadline- as Capital Markets Authority (CMA) assured brokers that CGT had been postponed to July. The tax appears to have deferred foreign investors’ confidence in the local bourse, prompting a selling spree; with the sustained stand-off prolonging one of the top-performing sectors of the Kenyan economy.
The Chartered Financial Analyst Society East Africa however, launched a ‘Statement of Investors’, a code of conduct document, hoping to regain investors trust; after a study showed lack of ethical culture as the leading contributor to distrust.
NSE Equity Market Highlights
Centum Investment Co Ltd (NSE: ICDC) was the most traded stock of the day accounting for 34.48% of the total value traded. Kenya Commercial bank (NSE: KCB) followed, with 32.91%.
Pan Africa Insurance Holding Ltd (NSE: PAFR) was the biggest gainer of the day up 8.72% to KES 81.00, reversing the previous days’ momentum. B.O.C Kenya Ltd was also amongst the top gaining counters rallying by 7.50% to KES 129.00.
Standard Group Ltd was the main losing stock dropping by 8.28% to 33.25, closely followed by Total Kenya Ltd; which dropped 6.45% to 21.75.
Foreign Investor Participation
Foreign investor participation was suppressed during Tuesday’s trading session accounting for 30.43% of total turnover against 69.57% local participation. Investors were predominantly engaged in accumulative activities resulting in net inflows worth KES 3.78Mn compared to net outflows worth KES 94.79Mn on Monday.
Foreign investors accounted for 30.43% of the NSE turnover as compared to 59.29% on Monday. Investors were active on the buying side recording net inflows worth KES 3.78Mn relative to net outflows worth KES 94.79Mn on Monday.
Kenya Commercial Bank Limited (NSE: KCB) was the day’s highest traded stock, recording a turnover of KES 128.17Mn to account for 13.09% of total market activity and 43.01% of foreign activity.
Safaricom Limited (NSE: SCOM) followed with a turnover of KES 104.31Mn representing 10.65% of total market activity and 35.00% of foreign activity. Bamburi Cement Company Limited (NSE: BAMB) posted the day’s highest inflows of KES 11.98Mn, whilst Kenya Commercial Bank Limited (NSE: KCB) posted the day’s highest outflows worth KES 13.70Mn.
Currency:
Performance: The Kenyan Shilling (KES) dropped further against the US Dollar (USD) by 0.51% to 97.90 as the pair traded at a three year low on Monday. The dollar demand by importers extended further pressure to the shilling, though tight liquidity in the money market kept the shilling from extending its weakening through the Central Bank’s auction of 2 and 10 year treasury bonds.
The KES registered gains against the British Pound (GBP) and Euro (EUR) by 0.49% to 151.68 and 0.58% to 107.59, respectively, as Greece sought to have its international creditors reduce conditions imposed on the release of bailout funds. On the regional front, the KES extended gains against the Tanzanian shilling (TZS) by 0.33% to 21.14 as gold exports remained low affecting foreign exchange inflows already rocked by reduced donor inflows.