Investor wealth at the Nairobi Securities Exchange fell by Sh10 billion last week as key stocks halted their recent price rally in the face of foreign investor selloffs and unimpressive financial results.
Market capitalisation, the measure of investor wealth, retreated to Sh2.66 trillion from Sh2.67 trillion the previous week, while the main indices and market turnover also closed in the red.
Although taking a smaller share of overall turnover, foreigners for the seventh straight week held a net selling position in the market, having been mostly active in the five largest counters.
“At 34 per cent, foreign investor participation declined for the second week in a row from last week’s 37.4 per cent. For the seventh straight week, foreign investors remained net sellers recording net outflows of $2.5 million –10.7 per cent higher week on week,” said Standard Investment Bank in their weekly market report.
Some of the counters in the market, notably banks, have been trading at multi-month highs in the past two weeks.
This has seen investors who had taken an earlier bet on them look to book their gains, ahead of the earnings announcement season which has shown some indications of flat to falling profits.
BAT Kenya #ticker:BAT, which recently announced a 21.2 per cent fall in net profit to Sh3.3 billion, was one of the leading losers among the large caps last week at 7.1 per cent, closing at a three-year low of Sh650.
The market is also experiencing what the Central Bank of Kenya says is a global shift in short-term capital out of smaller markets.