Follow

Equities market poor show continues

By Lewis Njoka
Tuesday, August 4th, 2020
Nairobi Securities Exchange. Photo/Courtesy
In summary
    • In July, equities turnover increased by nine per cent to stand at Sh13.5 billion ($125.5m) up from Sh12.4 billion in June.
    • Foreign investors remained net sellers with a net selling position of Sh5.4 billion (USD49.8m) compared to June’s net selling position of Sh1.7 billion ($15.9 m).

Lewis Njoka @LewisNjoka

Performance of the equities market which has dipped for the better part of the year continued with all the three main indices at the Nairobi Securities Exchange (NSE) joining the shilling in recording a downward surge.

This comes even as foreign investors at the NSE, who have become net sellers, continue ditching stocks for the more secure fixed income assets, a trend replicated in all other major markets globally. 

Cytonn Investments latest report notes that the NSE All Share Index (NASI), NSE 20 Share Index (NSE 20) and NSE 25 Share Index (NSE 25) declined by one, 4.4 and two per cent respectively last week.

Large declines

This pushed their Year to Date (YTD) performance to losses of 19.9 per cent, 32 per cent and 25.4 per cent for NASI, NSE 20 and NSE 25 respectively. 

The indices performance for the week was no different from July’s monthly performance where NASI, NSE 20 and NSE 25 declined by 3.2 per cent, 7.1per cent and 4.9 per cent, respectively.

“The equities market performance during the month was driven by large declines recorded by Co-operative bank, ABSA and Standard Chartered Bank (SCBK) of 13.6 per cent, 9.8 per cent and 9.4 per cent, respectively,” says the report.

According to the report, the all share index performance was driven by declines recorded by large-cap stocks, with the highest declines recorded in EABL, Co-operative bank and NCBA, which lost by 7.7 per cent, 5.8 per cent and 5.3 per cent, respectively.

“However, the decline was slowed down by gains recorded by other large-cap stocks, with the highest gains being recorded by Safaricom and Equity which both gained by 0.2 per cent and KCB which gained by 0.1 per cent,” adds the report.

Yesterday the shilling edged down further as commercial banks posted a dollar at Sh107.75/95 compared with last week’s close of Sh107.65/85.

Most traders attributed the move to end month demand for dollars from importers as the shilling edged down 6.3 per cent against the green back.

However, Central Bank of Kenya (CBK) governor Dr. Patrick Njoroge however said during an online monetary policy briefing forum last week that he was not concerned about the dip, coming on the back of coronavirus shocks.

ADVERTISEMENT