Nomination of new CBK governor eases pressure on shilling

Dismal Results on Banks and Lack of a Share Trigger Spurns NSE

The equities segment yet again retreated with the NSE-20 share index shedding 26.16 points to close sub-4800 level at 4790.50 points. The NSE All Share Index (NASI) and NSE market capitalization moved in unison; shedding 0.01% to 164.23 points and KES 2.297Tn correspondingly. Value of transactions accelerated by 68.58% to KES 1.305Bn as Equity Group Holdings Ltd (NSE: EQTY) and East African Breweries Ltd (NSE: EABL) emerged the day’s most actively traded counters; accounting for 45% of the day’s traded value. Market breadth was skewed in favour of advancers, pegging at 1.16x, as 22 stocks advanced while 19 stocks declined. As we settle into the week, the NSE appears to oscillate in search of a trigger.

Dismal results from financial stocks during the first quarter earnings release sent market jitters to many a investors as fears of a slowed economic growth in the year in addition to an imminent policy rate hike by the Central Bank with higher capital requirements portending lower earnings for lenders in the year.

NSE Equity Market Highlights

Equity Group Holdings Ltd (NSE: EQTY) was the most traded stock of the day accounting for 22.71% of total traded value with East African Breweries Ltd (NSE:EABL) following in pursuit to account for 22.61% of the total value.

Standard Group Ltd (NSE: SGL) was the biggest gainer of the day up 9.77% to top the day at KES 36.50. Pan Africa Insurance Holdings (NSE: PAFR) rose 6.67% to a Vwap of KES 80.0.

CFC Stanbic Kenya Holdings Ltd (NSE: CFC) slid 7.14% to edge lower at KES 104.0. Investors marked down its share price following lapse in book-closure date for payment of a final DPS of KES 5.20. Eaagads, Eveready, Umeme Ltd and National Bank (K) Ltd followed suit shedding 6.25%, 4.30%, 3.09% and 2.33% respectively.

Foreign Investor Participation

Foreign investor participation edged up during Wednesday’s trading session accounting for 72.18% of total turnover against 27.82% for local participation. Investors were active on the buying side resulting in net inflows worth KES 46.16 Mn compared to net inflows worth KES 60,840 on Tuesday.

Foreign investors accounted for 72.18% of the NSE turnover as compared to 69.64% on Tuesday.

Investors were dominant on the accumulative front recording net inflows worth KES 46.16 Mn relative to net inflows worth KES 60,840 on Tuesday.

Equity Group Holdings Limited (NSE: EQTY) was the day’s highest traded stock, recording a turnover of KES 280.69Mn to account for 22.71% of total market activity and 29.81% of foreign activity. East Africa Breweries Limited (NSE: EABL) followed with a turnover of KES 280.41Mn representing 22.61% of total market activity and 29.78% of foreign activity.

Safaricom Limited (NSE: SCOM) posted the day’s highest inflows of KES 9.38Mn, whilst East Africa Breweries Limited (NSE: EABL) posted the day’s highest outflows worth KES 14.46Mn.

Nomination of new CBK governor eases pressure on shilling

Performance: The Kenyan Shilling (KES) continued to register gains for a second day during Wednesday’s trading against the Dollar (USD) by 0.15% to 96.78 as pressures eased following the nomination of a new Central Bank of Kenya Governor, Dr. Patrick Ngugi Njoroge.

Furthermore, increased foreign investor inflows in the stock market and banks selling dollars have assisted in propping the shilling to stable levels. The shilling recorded shedding against the Euro (EUR), weakening 0.52% to 107.53 following retention of the 3 key interest rates by ECB -reiterating the continuation of the QE program.