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Foreign investors sold off Sh12b at NSE before polls

Business
 Foreign investor outflow at the Nairobi bourse stood at Sh12.3 billion. [iStockphoto]

Foreign investors sold off more than Sh12 billion worth of securities at the Nairobi Securities Exchange (NSE) in the months leading up to the General Election.

Data from the Capital Markets Authority (CMA) indicates that foreign investor outflow at the Nairobi bourse stood at Sh12.3 billion in the months between March and July 2022.

This marked a 313 per cent increase compared to a similar period last year and was the second highest foreign investor outflow since the Covid-19 pandemic, where Sh19 billion worth of securities was cashed out.  

According to CMA, the ongoing conflict between Russia and Ukraine remains a main cause of uncertainty despite a positive outlook for 2022.

“At the NSE, the end of quarter market capitalisation recorded a 20 per cent decrease to Sh1.9 trillion in the second quarter of 2022, down from Sh2.4 trillion recorded in the first quarter,” said CMA Chief Executive Wyckliffe Shamiah during the release of the CMA quarterly statistics.

“Similarly, the NSE 20 Share and NSE All Share indices decreased by 12.66 per cent and 20 per cent respectively in the second quarter of 2022, recording 1.612 points and 124.47 points respectively,” said CMA.

Equity turnover for the period under review stood at Sh26.24 billion while Sh195.67 billion worth of bonds were traded.

Safaricom led in trading in the equities market with an average of Sh4.9 billion shares traded in the first quarter of this year, representing 59 per cent of the monthly turnover of the top 10 blue-chip firms.

Other top trading stocks included Equity Group, East African Breweries Ltd and KCB Group. The numbers came at the height of the campaign season for the just-concluded polls that caused a slowdown in business activity, with investors adopting a wait-and-see approach.

Kenya’s business community has called for calm and a return to normalcy following the long campaign season.

“As we come out of the electioneering period, the manufacturing sector is keen to see a smooth transition.”

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