Trading on the Nairobi Securities Exchange (NSE) was yesterday suspended towards the close of the market as panicky investors made indiscriminate sale of shares.
Total market capitalisation dropped by Sh120 billion - one of the largest declines in a single day in the history of the bourse.
The value of all stocks closed at Sh2.04 trillion, compared to Sh2.16 trillion on Thursday.
The sell-off, which has been afoot for days, deepened yesterday as investors reacted to the spread of the coronavirus and a crash in the price of oil.
The government yesterday confirmed Kenya's first case of the disease that has killed more than 3,000 worldwide and caused economic dislocation.
"We halted trading at 2.38pm for 30 minutes," said Geoffrey Odundo, NSE's chief executive.
"The rules allow us to halt trading if the NSE 20 Share Index declines by more than five per cent," he added.
The decision effectively meant that trading will resume on Monday since the market closed within the 30 minutes.
Similar circuit breakers have been used twice this week by the New York Stock Exchange (NYSE) as investors dumped stocks fearing a global recession.
Temporary suspension of trading is an attempt to facilitate orderly transactions by giving investors time to think and see if they want to buy shares.
Yesterday on the NSE, most of the stocks including blue-chips like Safaricom, BAT Kenya, Equity Group, KCB Group, Jubilee Holdings and Bamburi Cement dropped by up to the maximum margin of 10 per cent.
The telecommunications firm, for instance, earlier in the day touched lows of Sh23.5 before recovering to close 5.45 per cent down at Sh24.35.
KCB fell 7.1 per cent to Sh42.65 while Equity dropped seven percent to Sh41.9. Insurer Sanlam Kenya and East African Cables receded 10 per cent each to Sh13.95 and Sh1.71 respectively, though on thin volumes.
Analysts at Standard Investment Bank (SIB) attributed the sell-off to the exit of foreign investors, adding that the stampede is not predictive of earning prospects of Kenyan firms.
Foreign investors, who make up about 70 per cent of daily trading at the NSE, have been net sellers in the past few weeks.
They have also been selling stocks in other markets including the United States, Japan, the United Kingdom and Australia.
Their risk aversion has intensified in recent days owing to a confluence of factors including the price of oil crashing to $35.6 per barrel and the declaration of coronavirus as a global pandemic.
The disease, which has an estimated mortality rate of two per cent, is paralysing social and economic activities in countries where it has spread to.
The scare is disrupting travel, supply chains and weakening demand for goods and services worldwide, raising the spectre of a substantial reduction in global economic growth.
At the NSE, the fears have outweighed expectations of dividend payments starting April for most companies whose financial year ends in December.
KCB and StanChart Kenya, for instance, are now priced to yield 8.1 per cent and 9.7 per cent respectively.
How fast the disease spreads and whether a vaccine can be developed fast enough are among the uncertainties rattling the public, investors and governments alike.