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Equities Market
Stock prices rose marginally in the first week of October 2025, recording a 0.3% uptick as measured by the Nairobi all share index. NSE 20 gained the most at 1.8% followed by NSE 25 and NSE 10 with 0.7% and 0.1%, respectively. The price surge was supported by improved foreign inflows and the general expectation of higher returns in the sector as interest rates remain low.
Market activity however, slowed down 41.3% to exchange 100.59Mn shares valued at KES 2,101.66Mn compared to 171.38MN shares of KES 5,657.38Mn traded in the week before.
Weekly foreign participation improved significantly from a nearly all-time of 7.0% to 22.9% in the week ending 3rd October with an improved net foreign inflow of KES 294.90Mn compared to a net foreign outflow of KES 457.69Mn recorded the previous week.
Heavy foreign entries were noted on KCB Group, Equity Group and Safaricom in that order.
Market focus remained on the telecommunication, the banking and the energy sectors which exchanged a total of 84.1% of the entire market value and 69.3% of the volumes traded.
The telco giant, Safaricom, emerged the week’s top mover with KES 1,138.58Mn after changing hands 26.25Mn shares to account for 54.2% and 26.1% of the market turnover and shares traded, respectively. The counter’s price dropped 1.7% from KES 29.40 to KES 28.90 per share while its foreign activity declined from 39.5% to 27.5% on average.
Safaricom is set to release its half year 2026 financials and updates in the first week of November 2025.
KCB Group took second mover position with KES 956.24Mn from 4.90Mn shares shoes price stabilized at KES 57.00 per share. The bank saw its foreign participation improve to emerge the week’s foreign destination.
Equity Group took third mover position with KES 293.22Mn after changing hands 2.95Mn shares whose price hit a new high of KES 58.25 per share, driven by improved foreign entries.
Williamson Tea emerged the week’s top gainer at 31.2% from KES 248.25 to KES 325.75 per share informed by its approaching 1:1 bonus share book closure scheduled for 13th October 2025. The same impact was witnessed on Kapchorua which recorded an 18.0% surge to KES 385.75 per share on its 1:1 bonus share book closure set for the same date.
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Bonds Market
Secondary bonds value traded dropped 26.1% week on week (w-w) from KES 57.26Bn to KES 42.34Bn as the number of deals transacted also shrunk from 974 to 788 deals.
The performance was largely impacted by a shift of focus by investors to the ongoing primary sale of the re-opened FXD1/2018/015 (7.7 years) of 12.65% coupon and FXD1/2021/020 (15.9-years) of 13.444% coupon, whose auction will happen on Wednesday, 15th October 2025.
The FXD1/2018/20 re-opened in July 2025 emerged the week’s top mover with KES 7.25Bn as its yield to maturity (YTM) shed 83.9bps from 14.1423% to 13.3031%, thus improving its value for investors who purchased the same in the primary to cash in.
The IFB1/2022/19 re-issued in August followed closely with KES 6.19Bn while its YTM reversed up 20.2bps from 12.8748% to 13.0765%.
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Yield Curve
The yield curve further witnessed mixed movements in the week with some wider shifts being prevalent in the middle curve on influence from the reopened papers.
The 9-years papers all the way to the 16-years paper shifted up faster with yield of above 32.9bps to a high of 102.0bps specifically influenced by the FXD1/2021/020 (15.9-years) paper.
In the coming week, we expect more upward shifts around 7.7-years and 15.9% as investors realign themselves to push for better discounts from the primary’s auction due in a week’s time.
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Interbank
Interbank rate rose 5.8bps in the week from 9.48% to 9.54% elevated by a rise in liquidity demand towards the end of the week. This saw average interbank up 3.8bps from 9.48% to 9.52%.
Liquidity demand accelerated 126.1% w-w from KES 10.90Bn to KES 24.65Bn. Average liquidity however, dropped 7.2% from KES 18.05Bn to KES 16.76Bn.
Bank excess reserves also improved from KES 2.40Bn to KES 5.40Bn on what we view to be liquidity build up towards settlement of pay as you earn (PAYE) tax due on 9th October 2025.
In the coming week we expect pressure to ease and the interbank rate to reverse down marginally on impact anticipated improvement in liquidity upon the KES 32.63Bn treasury bill maturities and KES 18.56n coupon payouts due on Monday, 6th October 2025.
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Treasury Bills
Weekly T-Bills auction was undersubscribed at KES 15.13Bn or 63.1% against a weekly target of KES 24.00Bn. The government accepted KES 15.12Bn or 99.9% of the subscribed amount to account for a 63.0% performance against target.
The performance was affected by low maturities of KES 18.55Bn due on 6th October 2025, out of which KES 17.38Bn were projected rollover redemptions.
Returns on investment across the three papers dropped marginally below 1.0bps to 7.9239%, 7.9829% and 9.5406% on the 91-, the 182- and the 364-day papers respectively.
In the coming week, we forecast an oversubscription following the heavy maturities of KES 32,63Bn, most of which we expect to be reinvested back.
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Currency
The local currency remained stable in the week trading at an average of KES 129.24 per USD dollar similar to the week before. However, against the British pound, euro and the yen, the shilling lost 0.4%, 0.3% and 1.2%v respectively.
Forex reserves remained stable at USD 10.72Bn sufficient for 4.7 months of import cover, nearly similar to USD 10.74Bn of 4.7-monts import cover recorded the week before.
In the coming week, we expect a surge in forex reserves following the cashing in of USD 500Mn after the net settlement of USD 1.0Bn from the 1.5Bn successful Eurobond floated on 2nd October 2025.
August 2025 forex reserves rose 4.2% to USD 427.20Mn in compared to USD 410.09Mn receipted in July 2025. Cumulative forex remittances inflows for the 12-months ending August 2025 were up 9.4% to USD 5.08Bn from that of USD 4.64Bn.
