Shares at NSE rally to hit daily high point this year

Shares at NSE rally to hit daily high point this year

The value of shares traded on the Nairobi bourse yesterday touched a daily high this year, buoyed by foreign investors who are trooping back on the market after a sell-off for the better part of this year.

Nairobi Securities Exchange (NSE) data showed turnover jumped nearly six-fold yesterday to Sh3.76 billion, driven by rising investor appetite for blue-chip firms.

Foreign investors, who have been net sellers for the better part of the year, accounted for Sh3.4 billion, or 90.4 percent, of the total shares purchased on bourse.

NSE chief executive Geoffrey Odundo said Thursday’s activity was a “testament of improving investor sentiments as listed securities in our market continue to show impressive recovery”.

The stock market has endured a tough year, largely due to uncertainty brought about by the Covid-19 pandemic on companies’ performance, which has translated to lower share prices as investors’ factor in the reduced profitability.

The activity on the market was largely driven by Safaricom whose counter transacted 15.8 million shares, an equivalent of 93.7 percent of the daily volume, despite trading 0.33 percent lower to Sh30 per unit.

Other major movers were Equity Holdings which traded 2.79 million, Kenya Re (1.09 million units) as well East African Breweries and KCB Group which transacted 808,600 and 575,800 units, respectively.

The foreigners, who had fled the Nairobi bourse in a global rush to safety in fixed income assets on the back of Covid-19 shocks, started trooping back last month in the wake of progressive re-opening of the economy.

enya lifted travel restrictions into and out of Nairobi and Mombasa, and resumed domestic flights in July before re-opening skies for international commercial flights from August 1.

This spurred an upturn in business activity which in July hit the highest level in a year, before slowing down marginally last month as measured by the Stanbic Bank Kenya’s Purchasing Managers Index (PMI).

“Foreign investors turned net buyers during the month, with a net buying position of $1.8 million, compared to July’s net selling position of $49.8 million,” said Cytonn Investments analysts in their monthly market summary for August.The recovery on the Nairobi bourse has boosted turnover which on Thursday amounted to Sh116 billion year-to-date, a growth of 11.3 percent compared with corresponding period in 2019.

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