Bank stocks continue to fall as foreign investors sell off

Bank stocks fell for a second straight day at the NSE, weighed down by foreign investor selling on key sector counters.

Eight of the 11 listed banks saw price declines Thursday, with Equity Bank being the main decliner, shedding 3.7 per cent to close the day at Sh45.25.

StanChart and KCB shed three and 2.7 per cent respectively to close the day at an average of Sh322 and Sh59 respectively, while Co-operative Bank was down 1.1 per cent at Sh21.75.

Safaricom, which Thursday reported a record net profit of Sh32 billion, retreated by 2.3 per cent to close the day at Sh17.15, while trading 19.8 million shares.

“On notable foreign investor selling, KCB touched a seven-week low of Sh59. Safaricom retreated despite posting a robust full year financial performance…while investors were happy with the results and dividend declared, it seemed like the guidance for 2016 weighed down the outlook for growth,” said Standard Investment Bank (SIB) in a market report.

The lenders are experiencing price declines in the middle of their first quarter earnings reporting season, with profits generally up on a similar period from 2014.

NIC Bank was the only gainer in the sector, up marginally by 0.8 per cent to close at Sh60. According to SIB, foreign investors were net sellers accounting for 71 per cent of the day’s total sales.

Safaricom was the day’s top mover in turnover at Sh399 million, followed by KCB and Equity at Sh328 million and Sh166 million respectively.

The three accounted for 63 per cent of the total market turnover, which improved to Sh1.32 billion from Tuesday Sh846 million.

For the second straight day Crown Paints was the day’s top gainer, up 9.5 per cent to Sh138.

The NSE 20 share index, weighed down by the losses on big cap counters was down 9.1 points to close at 5074.