Bond trading at Nairobi bourse gains 41 pct
24 August 2014, 08:44
Nairobi - Bonds turnover at Nairobi Securities Exchange (NSE) increased 41 percent this week as trading at the bourse took a positive turn following a slump last month.
The bonds market turnover increased to over 152 million U.S. dollars from 108 million dollars previous week. Corresponding deals increased to 131 from 80, showed data from the NSE and Central Bank of Kenya (CBK).
The rise in demand for the securities indicates that investors in the East African nation are warming to the bonds as fortunes at the debt market, where interest rate on key government short-term papers has dropped to less than 10 percent.
The NSE equities segment similarly recorded huge gains, with key indices of the market rising.
The NSE 20 Share Index closed the week at 5,028 points, up from 5,020 points last week. On the other hand, NASI ended the week at 156.43, from 155 the previous sessions.
FTSE NSE Kenya 15 Index, which measures stocks performance of 15 largest companies by market capitalization, ended the week at 203.09 points, up from 203.40 points in the previous week.
The volume of shares traded increased by 86 percent to over 170 million as turnover hit 55 million dollars.
Market capitalization, similarly, recorded significant growth as it rose to 25.2 billion U.S. dollars, up from 25 billion dollars.
"Reflecting these developments, shareholders' wealth measured by market capitalization gained 194 million dollars, just 69 million dollars shy of the 25.3 billion dollars mark," noted analysts at CBK.
As in previous weeks, the most active counter was the telecommunication and technology represented by Safaricom.
The counter moved 66 million shares or 65.3 percent of all shares traded during the week. The share is a favorite with foreign investors.
Energy and Petroleum and Banking sectors were the other most active counters, moving 44.6 million or 26.5 percent market share and 26.3 million or 15.7 percent market share, respectively. Agricultural sector was least active with 44,100 shares traded in the period."
The FTSE NSE Kenya 25 Index, which measures 25 most liquid stocks at the NSE, closed the week at 205 points from 205.32 points.
FTSE Government Bond Index gained 0.42 to close at 93.59 points from 93.17 points, reflecting uptick in secondary market yields.
The government during the week sold the five-year and 30-year bond, whose interest rates stood at 11.1 percent and 13.7 percent respectively.
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