Market Closes on Austere Note as 25 Stocks Decline

Equities

The week commenced with trading indices closing in a mixed territory indicating a similar trend compared to last week’s trading. The NSE-20 Share Index recorded a 0.52% slide to close at 3171.28 whilst the NSE-25 Share Index edged down by 1.86% to close at 3420.52 points.

The Nairobi All Share Index (NASI) similarly closed in the red territory, shedding 3.29% to close at 129.65 points. Market capitalization followed suit, contracting by 3.30% to close trading at KES 1.867Bn, while equity turnover slumped further by a significant 46.24% to close at KES 0.608Bn. Market breadth illustrated a similar trend, with the number of stocks that advanced -12- being outweighed by the number of stocks that declined -25.

Centum Investments Company Limited (NSE: ICDC) announced its intentions of putting up a 23 megawatt solar power plant to supply electricity to a mixed-use real estate project to be constructed in Vipingo, Kilifi County. The investment company stated that the project will embark once it gets a power generation and distribution license from the Energy Regulatory Commission.

Read: August Data Shows Improvement in Private Sector Growth

Centum Ltd recently announced plans to double its exploration wells on Akiira Geothermal project by end of 2016 at a cost of KES 1.4Bn to enhance generation of 70MW of steam power by end of 2017.  Akiira Geothermal project is jointly owned by Centum investment Company Limited, Frontier Investments Management and development partners – Marine Power Generation Limited (MPG) and Ram Energy Inc. (REI). These power projects are set to drive the power sector portfolio which is still on track and our expectation is that in the long term, the investment Company’s top line will be enhanced. Centum Investments Ltd registered high levels of activity, trading shares worth KES 722Mn.

Currencies

On Monday, the Kenyan shilling continued its positive trend against the US Dollar as a gauge of Kenya’s private sector growth was seen to have inched upwards last month. The CFC Stanbic Bank/IHS Markit Purchasing Manufacturers Index (PMI) data came in at 53.5, 0.2 points higher than as reported in July.  The local currency gained 0.06% against the US Dollar to close trading at 101.24.

The GBPKES pair erased 0.56% off its Friday’s close on marked signs that the United Kingdom is on its recovery path post-referendum debacle. The British pound was lifted by economic data from Market/CIPS that showed both composite and services PMI, at 53.6 and 52.9, respectively, better than had been anticipated.

Read: Dollar Inflows from Non-Governmental Organizations Boosts Shilling

On the regional front, the shilling posted mixed results as it retreated 0.64% against the South African rand and edged up 0.03% against the Ugandan shilling.  The weakening Ugandan shilling was largely attributed to US dollar demand from energy companies.

Foreign Investor Participation

The foreign investors accounted for 78.08 percent of total turnover against 21.92 percent of local participation.

Accumulative activities took center-stage, resulting in net inflows worth 27.78 million shillings relative to net inflows worth 27.32 million shillings on Friday. Foreign investors accounted for 78.08 percent of the total NSE turnover. Foreign investors engaged in net accumulative, resulting in net inflows worth 27.78 million shillings.

Equity Group Holdings Limited (NSE: EQTY) which recorded a turnover of 391.96 million shillings representing 64.49 percent of total activity and 82.60 percent of foreign investor activity, followed by Safaricom Limited (NSE: SCOM) which recorded a turnover of 48.09 million shillings to account for 7.91 percent of total market activity and 10.14 percent of foreign investor activity.

Safaricom Limited (NSE: SCOM) posted the day’s highest net inflows worth 18.73 million shillings and the day’s highest net outflows, worth 4.03Mn, were posted by the Co-operative Bank of Kenya Limited (NSE: COOP).