Weekly Market Performance Summary – Week Ending 21st March 2025
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Equities Market
The equities market turned up 0.5% in the third week of March to reap off from the ongoing better earnings being announced for full year 2024 (FY2024), more so from the banking sector. NSE 20 gained 0.4% followed by NSE 25 and NSE 10 with gains of 0.2% and 0.1% respectively.
Weekly traded turnovers improved 14.0% to KES 2,293.84Mn on increased market activity which saw shares transacted jump 60.2% week on week (w-w) from 96.77Mn to155.01Mn shares.
Foreign activities however, thinned further to 20.0% brought down by continued foreign exits resulting to a net foreign outflow of KES 153.38Mn compared to an average 27.8% of KES 79.92Mn net foreign outflows recorded the week before. Sector performance saw increased market attention on banking sector, the insurance and the telecommunication which transacted KES 1,201.65Mn, KES 641.48Mn and KES 326.76Mn, representing 52.6%, 28.0% and 14.2% of the market traded value respectively. The three sectors contributed a combined turnover of KES 2,169.89Mn or 94.6% of the market value from 139.68Mn shares or 90.1% of all the shares traded.
Liberty Kenya emerged the week’s top mover after trading a record 87.30Mn shares of KES 623.49Mn on what appeared to be local transfer of key ownership.
Focus remained on KCB Group to trade 13.237Mn shares of KES 566.63Mn and take second position in the top movers list despite a disappointing final dividend of KES 1.50 whose book closure and payment dates are set for 3rd April and 23rd May 2025 respectively. The bank’s price shed a further 0.4% from KES 42.15 to KES 42.00 per share. This is despite reporting a stellar net profit of KES 61.77Bn, a 64.9% year on year rise.
Equity Group took third place with KES 349Mn value from 7.39Mn shares of 33.0% foreign activity. The lender’s price shed 2.0% from KES 47.60 to KES 46.65 per share, ahead of its full year 2024 (FY2024) results scheduled for Tuesday, 25th March2025.
Standard Chartered Bank Kenya closed the top five movers’ list with KES 91.74Mn from 304,600 shares whose price emerged top gainer with a 12.3% w-w gain from KES 270.75 to KES 304.00 per share. This is after StanChart reporting a 45.0% acceleration in its profits from KES 13.86Bn in FY2023 to KES 20.06Bn in FY2024 on higher revenues. Consequently, the Bank’s Board recommended a 55.2% rise on its dividend per share from KES 29.00 in FY2023 to KES 45.00 in FY2024 whose book closure and payments will happen on 30th April and 28th May respectively.
Co-op Bank Group maintained the KES 1.50 per share first and final dividend after announcing a 9.8% rise on its FY2024 profits to KES 25.46Bn from that of KES 23.19Bn declared in FY2023. This saw the Group’s share price gain 6.0% w-w from KES 15.05 to KES 15.95 per share. Absa Bank Kenya grew its dividend from KES 1.55 in FY2023 to KES 1.75 per share in FY2024 after declaring a 27.6% rise on its results from KES 16.37Bn in FY2023 to KES 20.88Bn in FY2024. The performance was mainly rallied by strong interest income lines which recorded a 19.3% y-y spike.
Much attention also remained on Safaricom to emerge fourth on the movers list with KES 326.76Mn from 18.43Mn shares whose price stabilized at KES 17.75 per share week on week. In the coming new week, we expect earning releases from Equity Group and I&M Holdings on 25th March, NCBA Group on 26th March, CIC Group and HF Group on 27th March and Kenya Re on 28th March 2025.
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Bonds Market
The secondary bonds market improved in the week to move KES 76.10Bn from 1,022 deals, 33.1% lower compared to KES 57.05Mn from 997 deals traded the previous week. Market focus remained in normal bonds to control the market for the second week consecutive as opposed to infrastructure bond papers.
The papers controlled the market at 65.5% after trading a total of KES 49.85Bn, led by the recently opened FXD1/2023/05 paper. IFB1/2023/6.5, IFB1/2022/14 and IFB1/2024/8.5 followed in position 2, 3 and 4 as some investors also took advantage of their rates before the drop further.
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In the primary market, the National Treasury re-opened three papers, FXD1/2020/15, FXD1/2022/15 and FXD1/2022/25: targeting KES 70 billion for budgetary support. The auction will happen on 2nd April 2025 for a value date of 7th April 2025.
Yield Curve
The yield curve experienced a down-ward shift in the short end while the long-end of the yield curve above 12- years shifted upwards. The downward shift on the short end was largely impacted by low demand in the section while the issuance of the above three papers in the primary impacted the long end above 12-years and above. In the last week of March 2024, we expect a general rise in demand across the listed paper especially from institutional clients who will take positions as the first quarter of 2025 come to an end.
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Interbank
Interbank stabilized for the second consecutive week on average while shedding 5.0% w-w from 10.67% the Friday before to close at 10.62% the current week. Average interbank stabilized at 10.68% week on week.
Market liquidity however dipped by nearly half from KES 23.12Bn to KES 11.92BN to pull the average rate 57.4% w-w from down KES 21.85Bn to KES 9.31Bn. Bank excess reserves however improved 62.2% from KES 13.50Bn on Thursday 13th March to KES 21.90Bn by close of business 20th March 2025.
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Treasury Bills
T-bill auctions were oversubscribed for the seventh straight week, partly supported by re-investments from maturities and partly from new monies viewed to be from the banking sector as returns in the sector dwindle. The week’s auction was oversubscribed at 129.0% or KES 30.96Bn with KES 24.46Bn or 79.0% being accepted, representing a performance of KES 101.9%. Much attention was noted on the 364-day paper which attracted KES 30.96Bn of which KES 24.46Bn was accepted on its better returns.
Maturities for the week stood at KES 23.89Bn out of which KES 23.61Bn were reinvested back.
Return on investments across the three papers maintained a down-trend mainly impacted by the ongoing interest rate cut transmissions across the market. The 91-day paper lost the most followed by te 182 and 91-day papers with losses of 7.8bps, 2.9bps and 1.2bps respectively.
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Currency
The shilling remained relatively stable in the week, gaining 0.1%v against the US dollar and the British pound. Against the euro and the Japanese yen, the shilling also gained 0.2% and 0.7% respectively. We attribute the gains to an improved economic outlook and muted demand on these major currencies. Foreign exchange reserves remained high at USD 10,001Mn, enough for 5.1-months of import cover against a requirement of 4.0 months of import cover requirements.
The elevated forex reserves result from the overflows of the new 2036 Eurobond issued in early March 2025 that supported in settling the USD 900Mn that was maturing in May 2027. The new issue was oversubscribed with USD 4.9Bn oversubscription with the government accepting USD 1.5Bn as per plan.
