Kenyan Shilling gains against the US Dollar despite domestic dollar pressure

Market activities rebounded with key primary indicators pointing north except for the NSE-20 share index which pared down marginally by 0.02% to 4979.71 points while the NASI strengthened by 0.33% to 167.82 points.

Market capitalization ramped up 0.32% to KES 2.35Tn as equity turnover bucked the trend up; 14.12% to KES 1.34Bn. Kenya Commercial Bank Ltd (NSE: KCB) & Co-operative Bank of Kenya Ltd (NSE: COOP) were the most active counters accounting for 66.63% of the day’s traded value.

Insurance listed company, Pan Africa Insurance Company was the major laggard for the day having lost 22.80% of its value to a Vwap of KES 96.50. The Insurer had stated that they would be issuing a bonus issue of 1:2 shares despite their modest financial performance in the period concluded 31st December 2014, being the only firm that reported a decline in their net premiums among all the listed insurance firms. The book closure for the bonus issue had been slated for the 13th May 2015 and we attribute the dented share price to the dilution effect triggered on the share price following an increased number of shares resulting from the bonus issue. We portend to see heightened distribution activities on the stock in the coming days as investors offload their additional shares to make a gain from the bonus.

Foreign investor participation was robust during Thursday’s trading session with foreigner’s accounting for 65.50% of total turnover against 34.50% local participation. Investors engaged in accumulative activities resulting in net inflows worth KES 137.53Mn compared to net outflows worth KES 19.85Mn on Wednesday.

The highlights of the day’s trading activity are listed below:

Foreign investors accounted for 65.50% of the NSE turnover as compared to 83.74% on Wednesday.

Investors were dominant on the buy side recording net inflows worth KES 137.53Mn relative to net outflows worth KES 19.85Mn on Wednesday.

Kenya Commercial Bank Limited (NSE: KCB) was the day’s highest traded stock, recording a turnover of KES 425.14Mn to account for 31.84% of total market activity and 48.60% of foreign activity.

Cooperative Bank Limited (NSE: COOP) followed with a turnover of KES 165.04Mn representing 12.37% of total market activity and 18.87% of foreign activity.

Cooperative Bank Limited (NSE: COOP) posted the day’s highest inflows of KES 165.04Mn, whilst Kenya

Commercial Bank Limited (NSE: KCB) posted the day’s highest outflows worth KES 54.41Mn

Currency

Performance: The Kenyan Shilling (KES) gained against the US Dollar (USD) by 0.01% to KES. 96.05, despite domestic dollar pressure. The USD hit a three month low as investors continued to reassess expectations on the timing of the rate rise and the economy reported soft economic data; particularly jobless claims and producer price index.

The shilling shed against the British Pound (GBP) by 0.13% to KES. 151.68, with the sterling pound benefiting from investors sentiments that the economy is strong enough to warrant a potential increase in borrowing costs in the next 12 months. This resulted in traders slashing their bearish bets at the fastest pace since September. The shilling also lost against Euro, by 0.48% to KES. 109.62, as modest flows were not offset by some centres as they were closed for Ascension Day Holiday.

Large-Cap Index

The Large Cap weakened by 0.10% while market capitalization garnered a marginal 0.51% to KES 1.97Bn. Volume of traded shares was down; 6.50% to perch at 33.05Mn.

• Co-operative Bank of Kenya Ltd (NSE: COOP) was the top gainer in the large cap category spanning; 3.41% to KES 22.75.

• Mumias Sugar Co. Ltd (NSE: MSC) was on a losing streak, down; 2.50% to KES 1.95.

Mid-Cap Index

The Mid Cap index slid by 1.07% as market capitalization rescinded by 1.04% to KES 270.37Bn. Volume of trades regressed further by a hefty 43.40% to 2.34Mn.

• Uchumi Supermarkets Ltd (NSE: UCHM) was up; 4.27% to KES 11.00 on account of accumulation activities taking precedence on the counter.

• Pan Africa Insurance Holdings Ltd (NSE: PAFR) tapered by 22.80% to a Vwap of KES 96.50 following the book closure for the bonus issue of 1:2 yesterday.

Small-Cap Index

The Small Cap Index appreciated by 1.17% with market capitalisation nudging upwards by 1.52% to KES 40.70Bn.

• E.A. Portland Ltd (NSE: PORT) resurged by 9.26% to KES 59.00 fanned by a thin volume of 300 shares traded.

• Kapchorua Tea Co. Ltd (NSE: KAPC) closed in the red, down; 7.20% to a Vwap of KES 116.00.