Respite for the Shilling as it Strengthens Against Peers

Equities

The equities market demonstrated a bullish sentiment in Thursday’s session with Nairobi All Share Index (NASI) advancing 0.43 percent settling at 125.93 points. NSE-20 Share Index crossed the 3000-point mark buoyed by positive performance of majority of the ‘Blue Chip’ counters.

Following announcement of better-than-expected results from Barclays Bank of Kenya (NSE: BBK), the banking sector saw an increase in the share prices as indicated by most of its constituent counters with NIC Bank Ltd (NSE: NIC) (+7.48 percent) in the lead.

Safaricom Ltd (NSE: SCOM) traded the highest value in the session while block trades on Stanbic Holdings Plc (NSE: CFC) saw the bank move 851,100 shares ahead of its FY16 financials release slated for 24th February 2016. A lower-than expected FY16 earnings from British American Tobacco Kenya Ltd (NSE: BAT) saw the counter lose 0.77 percent of its share price in the session.

Foreign participation at the NSE on Thursday

Foreign activity continued to dominate the Equities market accounting for 65 percent of total turnover against 35 percent local participation in Thursday’s trading session.

There were accumulative activities control the session with net inflows of 19.01 million shillings compared to net outflows of 24.48 million shillings recorded in the previous session.

Foreign Investors showed major interest in Safaricom Ltd. (NSE: SCOM) over other counters recording a turnover of 99.52 million shillings (31.42% of total activity; 48.67% of foreign investor activity).

East African Breweries Ltd (EABL) was second with a turnover of 56.48 million shillings, of which 3.67 percent was foreign investor activity. It accounted for 2.93 percent of total market activity.

Stanbic Holdings Plc. (NSE: CFC) charted the day’s highest net inflows of 28.08 million shillings whereas Equity Group Holdings (NSE: EQTY) had the day’s highest net outflows, 3.26 million shillings.

Performance of the shilling on Thursday

The Kenyan Shilling strengthened against its East African peers in Thursday’s trading session (+0.16% -Uganda; +0.09% -Tanzania).

The Uganda shilling was firm against the US dollar as the Central Bank increased liquidity mop-up through repurchase agreement to wipe USD 147.96 million (USH 530Bn) from the market.

South Africa’s Finance Minister announced tax hikes aimed at the wealthy to bridge the budget deficit following the budget reading on Wednesday; the Rand remained strong against the shilling.

The shilling remained flat against the USD while weakening 0.42 percent and 0.44 percent against the Pound and Euro (respectively). The USD dropped against all its major counterparts after release of the FOMC February meeting minutes despite the sentiments that the rate-hike wouldn’t be effected in March as anticipated.

German Consumer Confidence Index(March) news that came in at 10.00 falling short of the expected 10.01, saw the Euro take a hit in Thursday’s European trading session. The EUR/USD went down to 1.055 from 1.056 just before the figures were released.

Related: Shilling Performance Varies as Foreigners Account for 79.74 Percent in Wednesday Session