Kenyan Stocks Extend Bullish Momentum as Foreign Investors Return and Economic Recovery Strengthens

Kenya’s capital markets continued their upward trajectory during the week ending July 13, with investors responding positively to improving economic fundamentals, renewed foreign investor interest, and strong performances from blue-chip counters led by Safaricom. This is according to data from the Standard Investment Bank (SIB).

The Nairobi Securities Exchange (NSE) closed the week on a bullish note, with all the major indices posting gains. The NSE All Share Index (NASI) rose 0.8% week-on-week, while the NSE 20 Share Index gained 0.4%. The NSE 25 and N10 indices also advanced by 0.3% and 0.1%, respectively, underscoring growing investor confidence across the market.

Despite the positive price movement, overall market turnover declined sharply to approximately USD 29 million, indicating that the rally was driven more by selective buying than broad-based trading activity. Market analysts noted that investors remained focused on fundamentally strong counters while awaiting fresh economic and policy signals.

Safaricom emerged as the week’s biggest driver of activity, accounting for more than one-third of total market turnover. The telecommunications giant gained 2.5 percent to close at KSh35.05, making it the strongest performer among the market’s heavyweight stocks. Its continued price appreciation reflects sustained investor confidence in the company’s growth prospects and its dominant position within Kenya’s telecommunications sector.

The banking sector presented a mixed picture. KCB Group strengthened by 1.9 percent to KSh80.00, while Diamond Trust Bank edged up marginally by 0.2 percent. However, Equity Group Holdings and NCBA Bank both recorded slight declines, easing by 1.1 percent and 1.4 percent respectively. Even so, the banking sector continues to remain one of the most actively traded segments of the NSE and has delivered impressive year-to-date gains across several counters.

One of the week’s most encouraging developments was the return of foreign investors as net buyers. Foreign investors recorded net inflows of approximately USD 599,000 after several weeks of subdued participation. Equity Group attracted the highest foreign buying interest, while Diamond Trust Bank experienced the largest foreign selling. Foreign investor activity also surged significantly, accounting for nearly 30 percent of market activity compared to just one percent in the previous week.

Among the week’s top gainers, Britam Holdings stood out with an impressive 10.6 percent rise, extending its remarkable year-to-date gain to nearly 60 percent. Standard Group climbed seven percent, while Uchumi Supermarket added 5.5 percent, continuing its strong recovery story this year. Kapchorua Tea and Longhorn Publishers also posted respectable gains, reflecting renewed investor appetite for selected mid-cap stocks.

On the downside, Kurwitu Ventures recorded the week’s steepest decline after falling 6.7 percent. Unga Group lost 6.6 percent, followed by East African Portland Cement, Home Afrika and I&M Holdings, all of which posted notable losses during the trading period.

Beyond the stock market, Kenya’s broader economic outlook continues to provide reasons for cautious optimism. According to the latest economic update, the country’s economy expanded by 5.3 percent during the first quarter of 2026, up from 4.9 percent recorded during the same period last year. The growth was broad-based, with every sector of the economy registering positive performance despite persistent cost pressures.

The accommodation and food services sector led the expansion, growing by an impressive 14.7 percent following a surge in international tourist arrivals. Construction activity also accelerated, supported by stronger cement consumption and increased lending to developers. Manufacturing rebounded strongly thanks to higher vehicle assembly, while agriculture maintained steady growth driven by improved tea and milk production. Financial services also benefited from the Central Bank’s accommodative monetary policy following reductions in the benchmark interest rate.

However, challenges remain on the horizon. The World Bank has revised Kenya’s 2026 economic growth forecast downward to 4.3 percent, citing heightened global geopolitical uncertainties and their impact on the international economy. Inflation has also edged higher due to rising food prices, while the country’s current account deficit has widened, highlighting the need for continued macroeconomic stability.

Looking ahead, investors are expected to closely monitor the upcoming Energy and Petroleum Regulatory Authority (EPRA) fuel price review, scheduled for July 14, which could influence inflation expectations and market sentiment. Analysts will also be watching whether the renewed foreign investor participation translates into sustained capital inflows capable of supporting further gains at the Nairobi Securities Exchange.

With blue-chip stocks maintaining their resilience, foreign investors returning to the market, and Kenya’s economy continuing to outperform many regional peers, the latest market performance suggests that investor confidence is gradually strengthening. Although global risks remain elevated, the combination of improving corporate fundamentals and steady economic growth provides a positive backdrop for Kenya’s capital markets as the second half of 2026 gathers momentum.

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