Financial Standard
With the global markets spooked by the ongoing coronavirus crisis, there has never been a better time to grab your dream shares at a bargain.
If you are looking to snap up a bargain at the stock market, you will be spoilt for choice. After the recent shaky preference of the country’s securities market, you now have the opportunity to grab top blue-chip companies at a discounted price than what you would have paid in January 2020. In a few rare cases, you can grab a yield worth 10 per cent a year or more at closer scrutiny of the mixed bag of opportunities presented by the bear market. Some of the biggest gains in history, after all, have been made by savvy investors who bought stocks when everyone else was selling. Last year, the performance of the Nairobi bourse was not-so-encouraging. The Nairobi Stock Exchange experienced a tough trading period as the struggling economy affected listed companies massively, with share prices tanking greatly. The NSE-20 share index – the weighted average share price of the 20 most valuable companies – fell below 2,500 points between August 20 and October 25, 2019. And 2020 was the year in which recovery was realistically expected. Close market followers were hoping for a bullish transformation that would stop investors from massively selling their stocks. But the expected recovery never materialised. When coronavirus was confirmed in the country on March 13, 2020, the NSE halted trading for 30 minutes after the All-Share Index fell 15 per cent, wiping out Sh120 billion off investors’ portfolios attributable to panic selling. “Kenya was no exception to the ensuing financial contagion, with the first announcement of Covid-19 cases resulting in the NSE 20-share index shedding over five per cent, prompting a market halt, sparked-off by panic selling in an already bearish market,” explained Luke Ombara, Director, Regulatory Policy and Strategy at Capital Markets Authority in a statement contained in the just-released statistical bulletin for the first quarter of 2020. “The 20.7 per cent drop in the NSE-20-Share Index witnessed in the quarter mirrored the corresponding declines in MSCI World, Emerging Markets and Frontier Market Indices of 21.4 per cent, 23.9 per cent and 27.7 per cent, albeit at a lower rate,” said Mr Ombara. The threat posed by the coronavirus outbreak has spooked global markets, sending stock prices reeling. Against such a backdrop of market worry, […]