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UPDATE 1-Kenyan shares fall to seven-week low, shilling flat
August 29, 2013 / 2:47 PM / 4 years ago

UPDATE 1-Kenyan shares fall to seven-week low, shilling flat

* Stocks fall for the fourth straight session
    * Shilling seen pressured ahead of rate meeting
    * Analysts expect central bank to hold key rate on Tues

 (Recast with stocks slide)
    By Kevin Mwanza
    NAIROBI, Aug 29 (Reuters) - Kenyan shares fell to a
seven-week low on Thursday as investors booked more profits and
turned to higher returns in the debt market, while the shilling
was barely changed.
    The benchmark NSE-20 share index fell for the
fourth straight session, sliding 0.7 percent to 4,708.05 points.
    "The half-year earnings were driving the market up, but now
that they are behind us, demand for stocks has fallen," said
Ronald Lugalia, an analyst at Afrika Investment Bank.
    "There is also a slight shift towards bills and bonds."
    Yields on Kenyan debt rose steadily for eight straight weeks
due to tight shilling supply in the market, but started falling
at auctions last week amid strong demand. 
    East African Breweries (EABL), the second-most
capitalised stock on the bourse, tumbled 5 percent to 286
shillings. Its shares have slipped from the 360 shilling-mark in
July when the company issued a profit warning.
    Equity Bank, the  country's largest bank by
customers, fell 1.5 percent to 32.75 shillings a share.
    In the foreign exchange market, the shilling was posted at
87.55/75 per dollar at 0958 GMT, a fraction weaker than
Wednesday's close of 87.50/70.
    Traders said the market was looking to a monetary policy
meeting on Tuesday for direction. 
    "End-month demand (for dollars) is over now. Everyone is
looking to see what the Monetary Policy Committee will say. From
there we can have a clear perspective," said Robert Gatobu, a
trader at Bank of Africa.
    A Reuters survey of 16 economists taken over the past week
forecast Kenyan interest rates would stay on hold until at least
the end of this year to counter rising inflation and pressure on
the currency. 
    Kenya held its benchmark lending rate at 8.50 percent in
July, with the central bank saying it wanted to allow more time
for earlier cuts to filter through the economy. 
    In the debt market, the yield on 91-day Treasury bills
 inched up to 10.474 percent at a heavily subscribed
sale. 
    Debt worth 1.4 billion shillings ($16 million) was traded in
the secondary market, down from 2.5 billion on Wednesday.
    
               ...........................Shilling spot rates
                  .....................Shilling forward rates
                           .......................Cross rates
         ..................................Local contributors
           .......................Central Bank of Kenya Index
          .....................Kenyan Bonds contributor pages
                          ...............Treasury bill yields
        ..................Central bank open market operations
        .........................Horizontal repo transactions
         ,       ................Daily interbank lending rate
              .............................Kenya Bond pricing
             ..................Real time Africa economic data
 <ECI & AFR> ...........................African economic news
          .................................NSE-20 Share Index
         .................................NSE All Share Index
             ...........................FT NSE Kenya 15 Index
             .......................... FT NSE Kenya 25 Index
  SPEED GUIDES:
                                    
            
 ($1 = 87.6000 Kenyan shillings)

 (Editing by Edmund Blair and Susan Fenton)

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