Kenyan Shilling Breaches 100 Level As MPC Meets

Kenyan Shilling Breaches 100 Level As MPC Meets

The Kenyan Shillings shed 0.13% as it breached the 100 level against the US Dollar (USD) during Tuesday’s trading session even as traders retained a cautious attitude whilst the MPC sat to review its current monetary policy stance. The local units’ recent fall indicates fundamental weakness as efforts to mitigate losses through the use of money market instruments have not been effective.

The KES shed 0.41% against the Sterling Pound (GBP), recording the largest loss for the day. On the other hand, marginal gains worth 0.10% were reported against the Euro (EUR) as the single unit currency tanked by nearly 1.2% against the USD after the ECB confirmedn that is was maintaining the “liquidity assistance” to Greek banks at 89 billion euros. Regionally, the KES retained its value against its peers, reporting the strongest gain of 1.23% against the Tanzanian Shilling (TZS).

Situation Intensifies in The Manufacturing Sector

The local bourse showed signs of improvement, after a week of sustained losses, particularly emphasised by a 0.02% appreciation in the NSE-20 share to 161.61 and a 0.11% rally by the NASI to reach 48150.28. The market breadth widened as the number of stocks that advanced, 17, failed to outweigh the number of stocks that declined, 19; the unbiased measure of stock performances thus showing that there was no particular improvement in the market.

Equity turnover better illustrated the market’s current market conditions as a significant drop by 55.01% saw turnover fall to KES 838mn, despite a market capitalisation increase 0.12% to KES. 2,262Bn.

The situation continues to intensify in the manufacturing sub-sector, brewery, as operations are distorted by public self-proclaimed crackdown on illicit alcohol. The various liquor distributors and brewers are estimated to be losing KES 100mn per day, due to public attacks catalysed by Kenya Bureau of Standards (Kebs) published list of expired licences; which contained 385 brands. East African Breweries Limited (NSE: EABL) was dealt the second blow (in as many weeks) after its subsidiary- Kenya Breweries- was forced to rely on exports and production of wine to maintain factory production; Kwal and Africa distillers also acquired the strategy.

East African Breweries was yesterday’s second most active trader, trading 1.65 million shares; the previous impediment was Tanzania Fair Competition Commission notice to revoke the Diageo-subsidiary’s merger with Serengeti Breweries. At the end of today’s trading session the counter gained 1%, with 232900 shares traded.

Equity Market Highlights…
Equity Group Holdings Ltd (NSE: EQTY) remained the most traded stock accounting for 43.13% of the total value traded; after accounting for 47.72% the previous day. Centum Investment Co Ltd. (NSE: ICDC) was close second accounting for 17.2% of the days traded value; after climbing ahead of East African Breweries.

Trans-Century Ltd (NSE: TCL) topped the top gainers list, scaling 8.63% to KES 15.10. CIC Insurance Group Ltd (NSE: CIC) registered a 4.61% gain to KES 7.95, curving in as the day’s second best gainer.

B.O.C Kenya Ltd. (NSE: BOC) climbed to claim the day’s top loser, shedding 6.47% to KES 130.00. Flame Tree Group Holdings Ltd. (NSE: FTGH) followed a close second as it retreated by 5.33% to KES 8.00; after remaining stable the previous trading session, amidst large losses made in the manufacturing sector.

Foreign Investor Participation Subdued During Tuesday’s Trading Session

Foreign investor participation subdued during Tuesday’s trading session accounting for 50.38% of total turnover against 49.62% local participation. Investors’ remained dominant on the sell side; resulting in net outflows worth KES 160.09Mn compared to net outflows worth KES 26.99Mn on Monday.

Foreign investors accounted for 50.38% of the NSE turnover as compared to 82.17% on Monday.

Investors engaged in distributive activities, resulting in net outflows worth KES 160.09Mn relative to net outflows worth KES 26.99Mn on Monday.

Equity Holdings Limited (NSE: EQTY) was the day’s highest traded stock, recording a turnover of KES 197.13Bn to account for 23.50% of total market activity and 45.65% of foreign activity whilst Kenya Commercial Bank Limited (NSE: KCB) followed with a turnover of KES 101.63Mn representing 12.12% of total market activity and 24.05% of foreign activity.

Kenya Commercial Bank Limited (NSE: KCB) posted the day’s highest inflows of KES 9.11Mn whilst Equity Holdings Limited (NSE: EQTY) posted the day’s highest outflows worth KES 161.21Mn.