Kenya’s stock market dramatically surged across the board on the first day of trading after the East African country’s Supreme Court upheld the elections of deputy prime minister Uhuru Kenyatta as president over the weekend.
Market report from the Nairobi Securities Exchange at the end of trade Tuesday showed the equity market crossed the 5,000 mark as tracked by benchmark NSE-20 share index.
The index that tracks performance of 20 most valuable and actively traded counters closed at5030.91 points, levels not seen since the deadly post elections violence after the disputed 2007 presidential polls.
This was 3.5 percent gain from where it left last Thursday-the last trading day before the six-judge bench of the Supreme Court delivered its landmark verdict.
The election of Mr. Kenyatta-the son of the country’s founding president Jomo Kenyatta- following the largely peaceful March 4 polls had been challenge by outgoing prime minister Raila Odinga, who accepted the ruling slightly over an hour after it was delivered last Thursday.
Mr. Odinga’s petition, filed a fortnight earlier, had been enjoined by that of a civil society, Africa Centre for Open Governance (Africog), that was also dismissed.
It’s the impact of the political certainty that sieved through to the stock market-a key macroeconomic indicator.
The All Share index(NASI) on the other hand climbed 3.11 per cent to 121.58 points.
By market capitalisation, the NSE wealth soared by Sh49.8 billion day on day to Sh1.65 trillion up from Thursday’s closing value of Sh1.6 trillion.
Earnings from Tuesday’s share trade almost doubled, closing at Sh939 million which was 95.6 percent higher than last Thursday’s Sh480 million.
This was largely on account of increased interest in equities with share volume rising to 85 million from 20 million.
Analysts attributed the performance on reduced political risk.
“(This is the) sharpest single day rally I can recall in more than 5 years,” said a Nairobi-based independent analyst, also the owner of consultancy firm Rich Management Ltd, Aly-Khan Satchu on his Twitter handle.
The soaring demand saw the value all trading shares jump up as reflected in their pricing, save for third largest cement maker, Athi River Mining, whose price dipped by a slight 0.73 percent to Sh68 a share day on day.
Shares of financial services company, CfC Stanbic Holdings, owned 60 percent by South Africa’s Standard Bank Group, was highest gainer by 10.00 percentage points to Sh66 a share.
State-owned Kenya Electricity Generating Company was second with a rise of 9.93 percent gain to Sh16.05.
Sameer Africa, East Africa Cables and hotel chain firm, TPS Serena East Africa, were also buoyant day on day, trading 9.90, 9.72 and 9.71 percent, respectively, better than their previous day’s prices before the Easter break on Thursday.
East and Central Africa’s largest telcoms company by profitability, Safaricom, was the most dominant counter, accounting for 64 percent of day’s trade at 54.84 million.
Sugar maker, Mumias Sugar Ltd, traded 5.87 million shares, making it the second most active stock.
CIC Insurance, oil marketer KenolKobil and East Africa’s largest bank by asset, KCB Bank Group, also experienced heightened activity closing with 3.77, 3.40 and 2.61 million shares on their respective counters.
“Some of the investors who had stayed out of the market awaiting the elections period to be brought to a conclusion are now coming back,”said Antony Kimani, a research analyst with Genghis Capital.
The equity market has returned 21.72 percent in value since the year started, according to Bloomberg’s data on NSE-20 Share index.
By end of March or first quarter, the market’s turnover stood at $399.92 million (about Sh34 billion), with inflows from foreign investors at $90.53 million (Sh7.7 billion)-about 22.63 percent.
