NSE turnover drops, indices in mixed 2019 performance

Nairobi Securities Exchange. FILE PHOTO | NMG 

By GEOFFREY IRUNGU
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Summary

• The Nairobi Securities Exchange (NSE) closed 2019 on a decline in equities turnover and the 20-share index, but recorded positive numbers on the NSE 25 and all-share indices.
• The turnover declined by 12.4 per cent to stand at Sh153 billion compared to Sh175 billion registered in the previous year.
• It was also lower than the traded volume of Sh171 billion recorded in 2017, but slightly higher than the Sh147 billion mark of 2016.

The Nairobi Securities Exchange (NSE) closed 2019 on a decline in equities turnover and the 20-share index, but recorded positive numbers on the NSE 25 and all-share indices.

The turnover declined by 12.4 per cent to stand at Sh153 billion compared to Sh175 billion registered in the previous year.

It was also lower than the traded volume of Sh171 billion recorded in 2017, but slightly higher than the Sh147 billion mark of 2016. The lower turnover means that stockbrokers, the NSE and the market regulator earned less last year in commissions.

The 20-share index fell by 6.33 per cent while the 25-share index rose by 15.46 per cent and the All-Share Index (NASI) was up 18.5 per cent.

Market capitalisation, reflecting the value of all the shares as the wealth of investors, was up 21.44 per cent or Sh400 billion to hit Sh2.5 trillion.

“The bourse closed the year with the benchmark index, the NSE 20 share index down 6.33 per cent to stand at 2654.39.

“The all-inclusive NASI picked up 25.98 points to settle at 166.41. The NSE 25 share index was up 548.98 points or 15.46 per cent to settle at 4100.57 points. Equity turnover declined by 12.40 per cent to Sh153 billion from Sh175 billion posted the previous year,” said the NSE in its end of year market report.

“Annual trading volumes decreased to 4.8 billion shares; down from 6.3 billion shares posted in year 2018. Market capitalisation stood at Sh2.5 trillion against Sh2.1 trillion posted at the close of year 2018; this represented an increase of 21.44 per cent in market value.”

One of the major driver of the gains came from banks, which benefited from the repeal of the interest rate cap to rally in the last quarter of the year.

The NSE said that the largest movers during the year were banks that contributed to 25.22 per cent of the total traded value with the telecoms sector (Safaricom) coming second at 23.64 per cent of the year’s traded value.

Standard Investment Bank said that the NASI benefited “largely on price upticks of large caps mostly in the last quarter. Equity Bank, KCB, Safaricom and NCBA recorded robust year-to-date gains of 53.5 per cent, 44.2 per cent, 41.9 per cent, and 32.6 per cent.”