US Dollar-Kenyan Shilling Firms on Tight Money Market Liquidity

Currency

The Kenyan Shilling (KES) traded on mixed notes during Tuesday’s trading session. On one hand the KES held firm against the KES as liquidity in the money market was relatively tight as demand for US Dollars (USD) was limited. Traders expect the USDKES exchange rate to strengthen over the coming days as tight liquidity in the market is likely to force banks to sell Dollars to fund the local currency. On the other hand, the KES displayed weakening against regional peers – posting the most significant loss worth 1.81% against the South African Rand.

The Rand posted healthy gains against major peers during the day’s trading session – leading global currency gains against the USD, on the back of a successful Eurobond sale and a corporate takeover offer which boosted confidence in Africa’s most-industrialised economy.

Foreign Investor Participation:

The foreign participation in the local market was full bodied during Tuesday’s trading session, accounting for 77.13% of total turnover against 22.87% of local participation. The nature of activity changed with buy positions taking the forefront resulting in net inflows worth KES 18.33Mn relative to net outflows worth KES 9.93Mn on Monday. Foreign investors accounted for 77.13% of the NSE turnover as compared to 61.09% on Monday.

Foreign investors engaged in net accumulative activities, resulting in net inflows worth KES 18.33Mn.

Equity Group Holding (NSE: EQTY) was the day’s highest traded stock, recording a turnover of KES 40.19% of total market activity and 52.11% of foreign investor activity, followed by Kenya Commercial Bank Limited (NSE: KCB) which recorded a turnover of KES 122.81Mn representing 29.12% of total market activity and 37.75% of foreign investor activity.

Cooperative Bank Limited (NSE: COOP) posted the day’s highest net inflows worth KES 8.44Mn and the day’s highest net outflows, worth KES 6.28Mn, were posted by Kenya Commercial Bank Limited (NSE: KCB).

Article by Genghis Research.