NSE investor wealth down Sh33bn as top counters shed value

An investor at the Nairobi Securities Exchange. PHOTO | FILE 

By CHARLES MWANIKI

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Summary

• The market capitalisation stood at Sh1.777 trillion compared to Sh1.81 trillion recorded on Tuesday.
• The NSE 20 share index as a result dropped in value for the second straight session, having gone back above the 3,000 point level last Thursday –for the first time since the second week of January.
• This was in spite of increased trading on Wednesday where market turnover rose by nearly two thirds to Sh233 million and foreign investors stood as net buyers.

Investor wealth at the Nairobi Securities Exchange (NSE) fell by Sh32.5 billion on Wednesday after the share prices of large stocks retreated in trading.

The market capitalisation—measure of investor’s paper wealth at the bourse— stood at Sh1.777 trillion compared to Sh1.81 trillion recorded on Tuesday.

Of the top five counters of Safaricom, East Africa Breweries, Equity Bank, BAT Kenya and KCB, only the tobacco manufacturer avoided a price fall on Wednesday, closing flat at Sh905 a share.

Safaricom closed 3.9 per cent or 70 cents lower at Sh17.05, which resulted in shaving off Sh28 billion in the company’s market capitalisation, which stood at Sh683 billion at close of trading on Wednesday.

“EABL, Safaricom and BAT were the leading movers jointly accounting for 64.7 per cent of market activity. Of the three, Safaricom was the worst performing and closed at a new low of Sh17.05- levels last seen in June 2016,” said Standard Investment Bank (SIB) in their daily market report.

EABL, second in size at the bourse as measured by market cap, closed 1.8 per cent lower, having shed Sh4 to Sh221 a share. This saw its market cap fall by Sh3.1 billion to Sh174.8 billion.

Equity Bank and KCB both closed the day 25 cents lower at Sh26 and Sh25 respectively, even though they were not heavily traded as they moved only 114,100 and 205,400 shares respectively. Six of the 11 listed banks shed value on the day.

The NSE 20 share index as a result dropped in value for the second straight session, having gone back above the 3,000 point level last Thursday –for the first time since the second week of January.

This was in spite of increased trading on Wednesday where market turnover rose by nearly two thirds to Sh233 million and foreign investors stood as net buyers.

“With only 12 counters in the green, most of which were small-caps, the benchmark indices posted significant declines for the second session in a row. Equity turnover rose 63.8 per cent to Sh233 million on increased foreign investor activity. Their participation rose to 66.9 per cent compared to 35.3 per cent in the previous session,” said SIB in their report.

Agriculture firms Kakuzi and Williamson Tea led the 12 gainers, up 9.2 per cent and 6.5 per cent respectively to end the day at Sh297 and Sh180 respectively.

KenGen gained 3.3 per cent to Sh6.30, even as the firm announced that its half-year to December 2016 net profit fell by 18.4 per cent to Sh4.6 billion.