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Foreign investors’ withdrawal from the Nairobi Securities Exchange decreased by Sh320 million in the three months to September 2023. However, it still impacted the market, lowering its value for the third consecutive quarter.
Foreign investors withdrew Sh1.18 trillion between July and September 2023, a decrease from the Sh1,5 billion reported in the second quarter of the year. Only two positive inflows have been observed in the past six months.
The Capital Markets Authority, however, insists that this points to a promising trend in which international investors are progressively restoring faith in the market.
Kenya’s top five listed firms on the Nairobi Securities Exchange (NSE) suffered a total decrease in market capitalisation of Sh101 billion from July to September.
According to CMA statistics, the average market turnover provided by the top five companies by market capitalisation, Safaricom Plc, Equity Group Holdings Plc, East African Breweries Ltd, KCB Group Plc, and the Cooperative Bank, was 65,41 percent, or Sh1,019 trillion, overall.
This is a nine percent (Sh101 billion) decrease from the five’s 67,8 percent turnover (Sh1,12 trillion) from the preceding second quarter, which ended in June 2023.
The decline has been ascribed to foreign investors pulling their money out of the exchange in pursuit of more secure assets as a result of the shilling’s depreciation.
This indicates that these five stocks saw a larger value decline during the quarter than the stock market, making them the most prominent victims of investor sell-offs, particularly when compared to smaller stocks that have somewhat withstood market volatility.
The Nairobi Stock Exchange was named the least-performing African exchange in dollar returns for the first nine months of the year in October, underscoring the effect of foreign withdrawals and world events on the largest stock market in East Africa. — Business Insider Africa.
Online Reporter