Nairobi Stock Market Rebounds on Safaricom, EABL and Banking Stocks

Banks, Safaricom Stocks Rally Should Continue in 2020 - Analysts

Stocks at the Nairobi Securities Exchange (NSE) rallied the most week ending Feb. 7 with the NASI, NSE-20, and NSE-25 rising 4.0%, 0.1% and 2.6% respectively week on week.

The performance in NASI was driven by gains recorded by large-cap stocks such as Safaricom, Equity, Standard Chartered Bank Kenya and EABL of 8.0%, 4.0%, 4.0%, and 3.5%, respectively.

Foreign investors accounted for 66.0% of the week’s total activity compared to 54.9% in the previous week.

Foreign investors were net buyers during the week posting net inflows of Ksh 109.0Mn compared to outflows of Ksh 397.3Mn in the previous week.

Net buying activity was largely on Safaricom, Equity Group and EABL while net selling was on KCB Group and BAT Kenya.

The market is currently trading at a price to earnings ratio (P/E) of 11.6x, 12.1% below the historical average of 13.2x, and a dividend yield of 5.6%, 1.7% points above the historical average of 3.9%.

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Stanchart Kenya and Sanlam Kenya  Farewell Plan
Standard Chartered Kenya CEO & Managing Director Kariuki Ngari and Sanlam Kenya CEO Patrick Tumbo officially launch the Farewell Plan

During the week, Standard Chartered Bank Kenya and insurer Sanlam introduced a new funeral cover, Farewell Insurance Plan, which will give policyholders an option of cashing in part of their premiums paid. Policyholders can be reimbursed up to six-months’ worth of premiums, after making payments for four years.

Source: Genghis Capital and Cytonn Investments