Kenyan Equities Market Continue to Retreat as Investors Take Reactionary Tone

Kenya’s main equity indexes closed mixed as foreign investors dominate trading

Nairobi Securities Exchange

The Kenyan equities market continued to post declines for the fourth consecutive session, following global concerns on the Coronavirus.

The week saw the NASI, NSE-20 and NSE-25 retreating 6.2%, 6.5% and 6.5%, respectively, week on week. 

The highest sell-offs from the market were registered on Tuesday as foreign investors retreated from the domestic securities market resulting into contracting of the NSE 20 and 25 indexes at 51.5 and 40.35 points respectively.

On Wednesday, the NSE 20 index and the all-share index (NASI) traded at their lowest levels since October 2019 with the two indexes losing a further 22.86 and 80 points respectively.

Turnover during the week rose 18.0% to Ksh 2.9 billion compared to a turnover of Ksh 2.5 billion in the prior week. 

Trading activity was mainly on the large caps; Safaricom, KCB Group, EABL and Equity Group.

Foreign investors accounted for 62.7% of the week’s total activity compared to 54.0% in the previous week. Foreign investors were net sellers for the third subsequent week posting net outflows of Ksh 300 million compared to outflows of Ksh  1.3 billion in the previous week. 

Net buying activity was largely on EABL and Diamond Trust Bank while net selling was on Safaricom, Equity and KCB Group. 

“We anticipate activity to remain on the index counters with market dominance by foreign investors in the week (2-6 March),” according to Genghis Capital. 

During the month of February, the equities market was on a downward trend, with NASI, NSE 20 and NSE 25 decreasing by (8.3%), (10.1%) and (9.0%), respectively, attributable to the continued market sell-off as profit-taking investors move to safe havens.