6 December 2017

Kenya: Stock Market Turnover Rises 58% After Poll Tensions Ease

Turnover at the stock market rose 58 per cent in November compared to October as the political tension in the country eased on the conclusion of the bitterly contested presidential poll.

Market data compiled by Standard Investment Bank (SIB) shows investors traded a total of Sh14.7 billion in November, up from Sh9.3 billion in October when the country held the repeat election amid protests.

The main indices at the Nairobi Securities Exchange (NSE) also gained during the month, driven by rise in large cap counters such as Safaricom, which hit an all-time trading high of Sh28.50 last month.

The largest stock at the NSE was up 7.8 per cent during the month.

"The Supreme Court ruling that unanimously dismissed the petitions challenging Uhuru Kenyatta's win on October 26 brought, to a large extent, an end to the uncertainty caused by the political noise that has been suffocating economic activity in the country over the past few months," said risk and research firm Stratlink Africa in its December markets bulletin.

"This was reflected in investor confidence that has fuelled bullish trends in the markets... which we expect will continue through the end of the year."

The NSE 20 share index was two per cent up during the month, the All Share Index gained 6.7 per cent while the NSE 25 Share Index, which mainly tracks financial sector firms, gained 4.8 per cent.

Banks were the top performers among the 10 largest firms at the NSE last month, led by Equity whose share price rose by 12.5 per cent to Sh42.75. KCB was up 8.6 per cent to Sh41.25 followed by DTB at 8.4 per cent to Sh194.

Market capitalisation at the bourse rose by Sh189 billion last month boosted largely by Safaricom, whose market value was up by Sh80 billion, and the late jump by Kenya Airways whose value rose to Sh77.2 billion from Sh8.5 billion after a debt-to-equity restructuring by the government and a consortium of local banks.

The surge has been largely aided by foreign investors who have been net sellers after withdrawing for most of the previous weeks.

"Equity turnover rose 36.7 per cent to $7.4m on increased foreign investor activity particularly on Safaricom and Equity Bank.

The two stocks jointly accounted for 82.9 per cent of total turnover," SIB said on Monday.

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