Trade Expected to be Subdued for the Remainder of the Year

Currency

The Kenyan Shilling (KES) little changed against both international and regional peers during Wednesday’s trading session. The USDKES displayed the least movement, shifting by -0.01%, as dollar demand and supply remained well balanced. A rising interbank rate also provided support for the local unit with fair distribution of liquidity in the money market. Meanwhile, U.S. home sales unexpectedly suffered their steepest drop since July 2010 on Tuesday, consequently weighing on dollar sentiment. However, separate data indicated that the world’s largest economy’s gross domestic product grew in the third quarter.

The local unit posted the strongest gain against South African Rand, up by (+0.49%). The ZAR took a back foot on subdued trade and sentiments that global headwinds and a strong U.S Dollar are likely to weigh on business sentiment. Trade is expected to be subdued for the remainder of the year as most market players are already on holiday, and with no major economic news to provide direction for the rand.

Foreign Investor Participation

Foreign participation diminished as we countdown days to the Christmas break, accounting for 19.44% of total NSE turnover, whilst local participants took up the bulk of the NSE trading. Foreigners closed positions, resulting in net outflows worth KES 33.10Mn relative to KES 9.00Mn net outflows on Monday.

Foreign investors accounted for 19.44% of the NSE turnover as compared to 24.77% on Monday. Foreign investors engaged in net selloff activities, resulting in net outflows worth KES 33.10Mn.

East African Breweries Limited (NSE: EABL) was the day’s highest traded stock, recording a turnover of KES 171.96Mn to account for 16.11% of total market activity and 82.89% of foreign investor activity, followed by Kenya Commercial Bank Limited (NSE: KCB) with a turnover of KES 16.32Mn representing 1.53% of total market activity and 7.87% of foreign investor activity.

Safaricom Limited (NSE: SCOM) posted the day’s highest net inflows worth KES 654,095 and the day’s highest net outflows, worth KES 15.88Mn, were posted by Kenya Commercial Bank Limited (NSE: KCB).