Secondary Turnover Dips By Half on Friday: What Should We Expect This Week?

Secondary market turnover nearly halved in Friday’s session to close at 796 million shillings according to insights from Genghis Capital.

According to Genghis, there is demand in the medium-term which we believe will be elevated on account of downward correction -in the range of 20bps – in the coming weeks.

Liquidity still remains tilted against Tier III banking players although the average inter-bank has improved in the last two weeks.

Overall, economic analysts say that they expect improved market activity in the week as funds rejected at the primary bond auction looks for a home as well as banking system liquidity improves after the tax week and end of CRR cycle.

The Kenyan shilling improved marginally against the US dollar in Friday to close at 101.04 level, further indicating the resilience of the local currency against other international giants.

The regulator may have come into the market to smoothen out volatility as the FCY reserves reduced by USD 38 million. The overnight rate closed elevated at 3.8 percent but analysts expect this to loosen this week.

The week ahead

The market continued its week’s uptrend in Friday’s session with Safaricom, KCB and Equity closing in the green.

The recovery of the counters can be attributed to cooling off of selling pressure observed in Thursday and Friday sessions.

As the week starts off, analysts say that they expect further gains in the counters with Safaricom expected to trade higher at 24.00 shillings. For KCB and Equity, investors might see the counters trade higher than Friday’s closing prices owing to some demand pressure on the counters.