Secondary Market Turnover Spikes To 2.37 Billion Shillings in Wednesday’s Session

Secondary market turnover rose to 2.37 billion shillings from 1.24 billion shillings in Wednesday’s session which was mainly attributed to trades on the medium-term and IFB’s.

Auction results were out with Central Bank having received bids of 22.13 billion shillings but accepted 21.24 billion shillings on the 10-yr with 18.75 billion shillings on competitive bids and 2.48 billion shillings non-competitive bids.

The weighted average rate declined marginally by 0.021 percent from the previous auction to 12.665 percent from 12.686 percent.

On the 20-yr also the regulator received bids of 10.32 billion shillings which translated to 25.82 percent but accepted 5.30 billion shillings with 4.04 billion shillings on competitive and 1.26 billion on non-competitive bids.

The rates also declined by 0.44 percent to 12.93 percent from 13.37 percent in the previous auction.

The inter-bank rate increased slightly from 3.55 percent to 3.81 percent on volumes of 7.7 billion shillings.

The CBK analysis yesterday showed excess liquidity with the regulator coming in the market to mop up liquidity in 3-day Repo at an average of 4.29 percent having received bids of 12.75 billion shillings but accepted 5 billion shillings.

The Kenyan shilling gained strength against the USD to close at an average of 100.79 shillings to the dollar.

According to market analyst, investors on Thursday should expect activity to be concentrated on the key traded counters: Safaricom and banking sector counters mainly KCB Group and Equity Group.

However, there’s uncertainty on market movement with the impending decision on the Finance Bill 2018.

Investors might see selling pressure on the above counters as well as other counters mainly by the foreign investor desk which analysts expect to dominate the market.

Safaricom has established support at 26 shillings while KCB Group and Equity Group are expected to hold at 40 shillings, the psychological level.