Kenyan Shilling Registers Gains after Spate of Shedding

Kenyan Shilling Registers Gains after Spate of Shedding

The Kenya shilling closed on a positive note during Tuesday’s trading session, making gains against all its regional and international peers after a spate of negative trends. The shilling registered gains against the US Dollar by 1.62% to 101.94 as the Central Bank injected dollars into the market to mitigate further pressure on the pair.

Further gains were registered against the Sterling Pound by 0.94% to 159.33 despite the Bank of England’s governor indicating that the rate hike is approaching. Further gains were registered against the Euro (EUR) by 1.54% to 112.60 as anticipation rises on the Greek parliamentary vote outcome on the bailout is awaited.

On the regional front, the shilling gained by 2.85% against the Ugandan shilling, and a further 0.65% against the South African Rand (ZAR).

Pan Africa Sets a New 52-Week Low

Sustained losses were registered on majority of the counters in today’s trading activities as illustrated by the worsening A/D ratio of 0.35x resulting from the advancers’ failure to outweigh the decliners. The NSE-20 share slumped by 0.67% to settle at 4692.17 while the NASI edged down by 0.57% to close at 158.39 points at the closing bell. Equity turnover was down; 25.24% to close at KES 0.551Bn, triggered by the losses in share values despite the 29% increase in volumes. Investors’ wealth contracted by 0.56% to close at KES 2.218Tn.

As the losing streak on majority of the counters persisted for the better part of today’s trading, all indicators from our valuations indicate that some stock prices have sunk further down below their fair values. The NSE 20 share index slipped below the 4700 points psychological mark into a two-year low, having lost 8.31% year-to-date. This could be attributed to the prevailing weak fundamentals in our economy, which have contributed immensely in the heightened exits from our markets by foreign investors as well as increased sell-offs from local investors as they curb any further detrimental losses on their portfolios. Pan Africa Insurance Holdings Ltd (NSE: PAFR) set a new 52 week low of KES 67.50, following a 10.00% loss in the share price while NIC Bank Ltd (NSE: NIC) closed the day at a Vwap of KES 50.50 which is also its 52 week low.

This downtrend may persist in the near term as speculations on a further weakening on the shilling persist.

Equity Market Highlights

Safaricom Ltd (NSE: SCOM) was the most traded stock for the day accounting for 48.11% of the total value traded. East African Breweries Ltd (NSE: EABL) came in second accounting for 19.21% of the days traded value.

Kakuzi Ltd (NSE: KUKZ), propped up by 7.88% to KES 356.00 marking the top gainer position. British American Tobacco Kenya Ltd (NSE: BAT) posted a 5.93% gain to KES 750.00, closing as the day’s second best gainer.

Pan Africa Insurance Holdings Ltd. (NSE: PAFR) was the major laggard of the day, dipping by 10.00% to KES 67.50 as investors continued engaging in distributive activities. Standard Group Ltd (NSE: SGL) trailed behind tapering by 7.64% to KES 33.25.

Foreign Investor Participation

Foreign investor participation edged up during Tuesday’s trading session accounting for 75.90% of total turnover against 24.10% local participation. Investors’ engaged in distributive activities; resulting in net outflows worth KES 5.83Mn compared to net inflows worth KES 45.33Mn Friday.

Foreign investors accounted for 75.90% of the NSE turnover as compared to 54.55% on Monday.

Investors were dominant on the selling front, resulting in net outflows worth KES 5.83Mn relative to net inflows worth KES 45.33Mn on Monday.

Safaricom Limited (NSE: SCOM) was the day’s highest traded stock, recording a turnover of KES 247.67Mn to account for 44.86% of total market activity and 59.10% of foreign activity whilst East African Breweries Limited (NSE: EABL) followed with a turnover of KES 99.54Mn representing 18.06% of total market activity and 23.79% of foreign activity.

Kenya Commercial Bank Limited (NSE: KCB) posted the day’s highest inflows of KES 4.25Mn whilst Uchumi Supermarkets Ltd (NSE: UCHM) posted the day’s highest outflows worth KES 17 Mn.