Foreign investors troop back to Nairobi Securities Exchange
What you need to know:
Government has been talking with stockbrokers on how to implement the capital gains tax, giving hope of an amicable solution to the standoff witnessed at the beginning of the year.
Fears over Nigeria’s stability, which is a major foreign investments destination in Africa has also seen investors reroute their cash to Kenya.
Foreign investors returned to the Kenyan market in the month of February as concerns over the capital gains tax waned and fears mount over Nigeria’s stability.
Foreigners invested an additional Sh192 million in the Nairobi Securities Exchange last month compared to a withdrawal of Sh261 million in January when the gains tax was introduced, data compiled by Standard Investment Bank (SIB) showed.
“Once there was a bit of clarity on the gains tax the jitters fell and foreign investors started coming back,” said Stella Wambugu, a research analyst at SIB.
The government has been talking with stockbrokers on how to implement the capital gains tax, giving hope of an amicable solution to the standoff witnessed at the beginning of the year.
The value of shares traded shot up 62 per cent to Sh15.7 billion with most counters on the upward trend. The indicative 20-share index gained 5.4 per cent during February with investors’ wealth growing by Sh111 billion to Sh2.4 trillion.
Fears over Nigeria’s stability, which is a major foreign investments destination in Africa has also seen investors reroute their cash to Kenya.
“There is concern in Nigeria where most of our investors also are; that nervousness leads to asset reallocation,” said Andre Desimone, the chief executive of Kestrel Capital.
Nigeria is struggling with falling oil prices and uncertainty over upcoming polls.
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