NSE index falls to four-year low as bank stocks make gains after scare
The electronic board at the Nairobi Securities Exchange. On Thursday turnover declined as well as the number of shares traded. PHOTO | FILE
The Nairobi Securities Exchange’s (NSE) main index fell to a new four-year low of 3868 points, even as stock prices of several banks that had earlier fallen recovered slightly.
The NSE 20 Share Index is now down 24.3 per cent year to date, with the factors behind its fall ranging from poor corporate results and profit warnings to shifting of funds to the primary fixed-income market which is currently benefiting from high interest rates.
The NSE said turnover also declined as well as the number of shares traded.
“Turnover declined to Sh1.29 billion from the previous session’s Sh1.49 billion, the number of shares traded stood at 36 million against 44 million posted (the previous day). The NSE 20 Share Index shed 7.66 points to stand at 3868.18,” said the NSE in a report.
In its analysis, Nairobi-based Standard Investment Bank (SIB) said that foreign investors dominated the trading as has been the case of late.
“Foreign investors continued to dominate the market accounting for 84.9 per cent of the activity. They turned net buyers at 88.5 per cent of total buys,” said SIB.
The analysts said that CFC Stanbic, Kenya Re and NSE recorded notable foreign investor interest which led them to rise 2.3, 1.3 and 4.8 per cent respectively.
The analysts noted that KCB and Equity were among banks that saw their prices rise after a major rout the previous two days. This came in the wake of the closure of mid-tier lender Imperial Bank on Tuesday.
“Following low prices recorded previously, KCB and Equity each rose 2.5 per cent as demand outstripped supply for most part of the session,” said SIB.
NIC Bank’s share rose 7.7 per cent to stand at 38.50 while Coop Bank’s stock rose 2.8 per cent to Sh16.45.
Imperial Bank collapsed on Tuesday due to what the Central Bank of Kenya said were “malpractices” and “unsafe or unsound business conditions”, but the market panicked because of the mystery behind the fall in view of the fact that the institution had its financials and ratios right while the regulator’s information was not specific. Nearly all listed banks lost ground for two straight days before several of them recovered on Thursday.
PAYE Tax Calculator
Note: The results are not exact but very close to the actual.
