Kenyan shilling gains against major regional and international peers

The equities segment heaved momentarily to halt its seven-session decline that saw market capitalization recede by KES 61.07Bn. The NSE-20 share index retraced back 29.92points to 4816.66 points as the NSE All Share Index (NASI) rose 1.31% to 164.25 points.

Market capitalization clawed back in tandem with the NASI to close higher at KES 2.297Tn as value of transactions simmered 61.96% to KES 774Mn. British American Tobacco Ltd (NSE: BAT) and Equity Group Holdings Ltd (NSE: EQTY) emerged the day’s most actively traded counters accounting for 40.08% of the day’s traded value.

Going forward, we are cautiously optimistic of a possible rebound in the equities market as risk factors abate and accumulation activities accelerate ahead of the expedited 9th June MPC meeting.

Despite sweltering pressure that pared down the USDKES pair to 98 levels, today’s recovery of the KES to 96.93 yields hope of a moderate rise in CBR by 50-75bps as domestic pressures wane whilst balancing factors ranging from this month’s Euro-bond coupon payments to an anticipated oil glut expected to trim pump prices sub-USD55 level.

Taking stock of price corrections on majority of blue chip counters, we predict bargain hunting activities to determine market direction over the week.

NSE Equity Market Highlights

British American Tobacco Ltd (NSE: BAT) was the most traded stock of the day accounting for 20.51% of total traded value with Equity Group Holdings Ltd (NSE:EQTY) following in pursuit to account for 19.57% of the total value.

Kakuzi Ltd (NSE: KUKZ) was the biggest gainer of the day up 9.89% to KES 300.0 despite closing its book on 29th May for DPS payment of Kes 3.75. CFC Stanbic Kenya Holdings Ltd (NSE: CFC) halted its 12.0% WoW decline; edging up 8.74% to KES 112.0.

The counter witnessed significant sell-offs last week following the lender’s 29% bottom-line slump in first-quarter earnings Jubilee Holdings Ltd (NSE: JUB) led the decliners; down 7.49% to peg its share price at KES 531.0.Pan Africa Insurance, Sameer Africa, Scangroup Ltd, and Housing Finance Co. followed suit shedding 6.25%, 5.88%, 5.13%, and 4.10% correspondingly.

Foreign Investor Participation

Foreign investor participation gained during Monday’s trading session accounting for 69.64% of total turnover against 30.36% local participation. Investors were active on the buying side resulting in net inflows worth KES 0.06Mn compared to net inflows worth KES 1.86Mn on Friday.

Foreign investors accounted for 69.64% of the NSE turnover as compared to 35.10% on Friday.

Investors were dominant on the accumulative front recording net inflows worth KES 0.06Mn relative to net inflows worth KES 1.86Mn on Friday.

Equity Group Holdings Limited (NSE: EQTY) was the day’s highest traded stock, recording a turnover of KES 140.99Mn to account for 19.57% of total market activity and 26.16% of foreign activity. Kenya Commercial Bank (NSE: KCB) followed with a turnover of KES 104.68Mn representing 13.53% of total market activity and 19.42% of foreign activity.

Kenya Commercial Bank (NSE: KCB) posted the day’s highest inflows of KES 27.06Mn, whilst British American Tobacco (NSE: BAT) posted the day’s highest outflows worth KES 78.60Mn

Currency

Performance: The Kenyan Shilling (KES) commenced the week’s trading on a positive note recording gains against all its major international and regional peers. The shilling recorded gains against the Dollar (USD) by 0.82% to settle at 96.93 after facing significant shedding beyond the 97 threshold. Central Bank’s advance in its Monetary Policy meeting set for next week from July is speculated to mitigate further shedding on the currency.

Gains were further registered against the Sterling Pound (GBP) and the Euro (EUR); up 1.06% and 0.15% to 147.63 and 106.97 respectively. On the regional front, the shilling extended gains against the Tanzanian (TZS) and Ugandan (UGX) shillings by 2.78% and 1.49% respectively while the ZARKES pair gained 1.47% to 7.90 following announcements that the South African Competition Authority is investigating rand price fixing claims with stiff action set to ensue in a similar fashion to that taken by UK and US authorities against major international lenders.