Market Monitor: 16th March 2015

The main indices retreated in today’s session with the NSE 20 share index shedding 8.13 points to 5,342.17 points while the NASI edged lower by 0.20% to 171.66 points. Market capitalization trimmed by KES 4.91 Billion to KES 2.397Tn as equity turnover shed 14.05% to KES 0.52 Billion worth of traded shares on the back of Safaricom Ltd (NSE: SCOM) & Equity Group Holdings Ltd (NSE: EQTY) shares that accounted for 65.14% of the day’s traded value.

Standard Group Ltd (NSE: SGL) announced its FY14 results for the period ended 31st December whereby pre-tax earnings span by 8.08% as rise in the operating profits was underpinned by initiatives carried out by management to improve process controls through automation, bolstered control environment and effective cost management. This improved efficiency translated into improvement in operating margins to 9.29% – FY14 Vs 8.73% – FY13 as PBT margins improved to 6.82% – FY14 Vs 6.26% – FY13. Management retained its DPS at KES 0.50 with the company’s book closure date set to be confirmed at a later date signifying a dividend yield of 1.23% based on today’s VWAP of KES 40.0; down 1.84% from KES 40.75.

Foreign investor participation declined during Monday’s trading session with foreigners accounting for 33.23% of total turnover from 45.27% registered on Thursday. Foreign investors were dominant on the selling side; resulting in net outflows worth Kes 16.42Mn compared to net outflows worth 140.71Mn on Thursday.

Foreign investors accounted for 33.23% of the NSE turnover from 45.27% on Thursday.

Investors engaged in profit taking activities recording net outflows worth Kes 16.42Mn relative to outflows worth Kes 140.71Mn on Thursday.

Safaricom Ltd (NSE: SCOM) was the day’s highest traded stock, recording a turnover of Kes 89.56Mn to account for 17.37% of total market activity and 52.26% of foreign activity.

Equity Group Holdings Limited (NSE: EQTY) followed with a turnover of Kes 69.57Mn representing 13.49% of total market activity and 40.59% of foreign activity.

Kenya Commercial Bank Limited (NSE: KCB) posted the day’s highest inflows of Kes 28.09Mn, whilst Safaricom Limited (NSE: SCOM) posted the day’s highest outflows worth Kes 18.65Mn.

Currency

Performance: The week’s trading commenced with a significant weakening registered on the USDKES pair as it shed 0.65% to settle on the 92.25 threshold, reaching its lowest since November 2011 as the Central Bank of Kenya mopped up KES 4 Bn in Repurchase Agreements and Term Auction Deposits to stem the slide. This is attributable to declined earnings from tea inflows as the drought persists, coupled with the continued global rally on the dollar.

The local currency further gained 0.20% against the Euro (EUR) settling at 97.22 as the Euro reached a 12 year low from its first week of the Quantitative Easing program, with a subdued currency portended to spur exports as they will be more competitive.

Large-Cap Index

The Large Cap index span 0.27% as market capitalisation rescinded to KES 2.00Tn. Volume of traded shares rose marginally to KES 18.83Mn from last week’s close of KES 18.01Mn

• Mumias Sugar Co. Ltd (NSE: MSC) edged higher by 5.66% to KES 2.80 buoyed by speculative trading on the counter.
• Bamburi Cement Ltd (NSE: BAMB) shed 1.23% to KES 161.0 as investors cashed in on the counter’s recent share rally.

Mid-Cap Index

The Mid Cap index edged higher by 0.54% as market capitalization rose 0.13% to KES 280.93Bn from KES 280.56Bn.

• Uchumi Supermarkets Ltd (NSE: UCHM) soldered by 6.15% for the day to a Vwap of KES 10.35.
• Sasini Ltd (NSE: SASN) weighed on the index; down 2.88% to KES 15.15.

Small-Cap Index

The Small Cap Index lost 0.27% as market capitalisation shed 0.22% to KES 41.61Bn.

• Crown Paints Ltd (NSE: BERG) rose 6.50% to mark the day at a Vwap of KES 131.00
• BOC Kenya Ltd (NSE: BOC) diminished by 8.11% for the day to a Vwap of KES 136.00