Shilling weakens, Centum leads stocks higher
30 September 2014, 08:47
Nairobi - The shilling weakened on Monday due to increased importer demand for dollars, while stocks closed higher lifted by investment firms.
At close of trade at 1300 GMT, commercial banks quoted the shilling at 89.30/40 to the dollar, compared with Friday's close of 89.10/20.
Earlier in the session, traders said the shilling was expected to weaken as the month drew to a close, due to demand from importers in sectors like manufacturing and energy.
Traders said demand for dollars was also to pay for capital goods like machinery meant for projects like roads, railroads and airports.
"All these things, whether we like it or not, we have to import... so the balance of payments, no matter what, is growing and will continue growing," Ian Kahangara, trader at National Bank, said.
Traders said the shilling, which has lost 3.08 percent against the dollar so far this year, will trade in the 88.80 to 89.50 range in the coming days.
On the Nairobi Securities Exchange, the main NSE-20 Share Index was up by 40.85 points or 0.78 percent, to close at 5,257.81 points.
Centum Investments was the biggest gainer, followed by British American Investments. Traders said the stocks became attractive after falling last week on profit-taking after rising over several days.
Centum closed 9.2 percent higher at 65.50 shillings a share, while British American rose 5.2 percent to 35.25 shillings.
"Some investors saw some value in buying (Centum and Britam) at lower prices," Ian Gachichio, research analyst at Kestrel Capital, said.
On the secondary market, government bonds valued at 1.29 billion shillings ($14.47 million) were traded, compared with 543.3 million shillings traded on Friday.
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