Stock in Focus: The Market Closed in Mixed States on Wednesday’s Trading

The Equities market closed in mixed state in the session bucking the previous two sessions of dips. The Nairobi All Share Index (NASI) fell further by a slight 0.03 percent to 124.91 points.

The NSE-20 Share showed signs of recovery with 0.64 percent gain to perch at 2952.33 points while the NSE-25 Share Index dipped 0.05 percent to close at 3250.13 points.

The A/D ratio, an unbiased measure of market breadth, ended north to 1.82x today from 1.43x in yesterday’s session.

Energy Regulatory Commission

The Energy Regulatory Commission (ERC) reviewed fuel prices for February 15th – March 14th period. In the review, pump prices for Super Petrol, Diesel & Kerosene edged upwards by K4.26, 5.03 & 3.75 shillings respectively.

The move will accelerate inflationary pressures that has been exacerbated by a prolonged drought in the country. The move is also likely to trickle to listed oil marketers KenolKobil Ltd (NSE: KENO) and Total Kenya Ltd (NSE: TOTL), with a slowdown in top line numbers (albeit constant margins) attributed to anticipated wane in consumer spending and global oil price uptick.

Foreign Participation on Wednesday’s Trading Session

Foreign participation edged up to account for 89.30 percent of total turnover while local investors accounted for 10.70 percent.

The session was characterized by distributive activities for the second session with net outflows of 14.58 million shillings compared to net outflows of 26.18 million shillings in the previous session.

With a turnover of 799.99 million shillings, Safaricom Ltd. (NSE: SCOM), solidly remained the day’s most traded stock representing 71.83 percent of total activity and 80.44 percent of foreign investor activity.

ARM Cement Co. Ltd. (NSE: ARM) came second with a turnover of 96.25 million shillings; accounting for 8.64 percent of total market activity and 9.68 percent of foreign investor activity.

KenGen Company Ltd. (NSE: KEGN) recorded the day’s highest net inflows of 22.68 million shillings, while Safaricom Ltd. (NSE: SCOM) registered the day’s highest net outflows, 19.01 million shillings.

The Performance of Kenyan Shilling on Wednesday

The Kenyan shilling posted mixed performance against a basket of select currencies on Wednesday’s session.

Against the US dollar, the local unit steadied at 103.65, held firm by reduced importer demand. US Federal Reserve Chair Janet Yellen, in her first semi-annual Congress testimony, hinted of a possible rate hike in March.

The dollar was also awaiting a jerk from January y/o/y headline inflation data (to be released post-Kenya trading session) with expectations of an uptick to 2.40 percent from prior 2.10 percent.

Across the pond, the shilling gained 0.49 percent and 0.59 percent against the pound and euro currencies respectively. Economic data released in the UK pointed to a slowdown in average weekly wage growth – 2.60 percent against 2.80 percent in the previous quarter – denting hopes for inflation uptick in the coming months. The lower-than-expected wage data trails the soft January inflation print announced on Tuesday; that will subdue pound performance in the course of the week.

On the regional front, the shilling erased 0.92 percent against the rand; the South African currency uplifted by improved risk appetite. The local unit edged 0.05 percent lower against both the Ugandan and Tanzanian shillings. Bank of Uganda slashed its base rate by 50 bps to 11.50 percent in the session.