Investors at the Nairobi Securities Exchange (NSE) were KSh 419.5 billion richer in the 10 months to October 2024 amid renewed market confidence, especially from domestic investors, as the market rally continued.
- Investor wealth, as shown by the Market Cap surged 29.2% to KSh 1.9 trillion at the end of October from KSh 1.4 trillion at the beginning of the year.
- The market was bullish with the NSE All Share Index (NASI) gaining 28.9% to 118.73 points in the 10 months to October. The substantial growth in the overall market cap saw the benchmark index – NSE 20 Share Index – rise by 28% in the same period.
- The Energy and Petroleum sector saw the highest returns in capital gains with a 53.5% median gain year-to-date, propelled by massive gains from Kenya Power and KenGen.
The banking sector remained resilient, recording a 26.7% median gain, with only BK Group closing October with a negative year to date performance of 7.5%. Gains by Bamburi Cement and East Africa Portland Cement lifted the median of the construction sector at the NSE to 45.8%.
In October alone, the market capitalization of all the listed companies at the NSE grew by KSh 182.3 billion. However, the total value of shares traded saw a 1.6% downtick to KSh 4.91 billion in October from KSh 4.99 billion recorded in September. Foreign investors were net sellers, recording KSh 569.9 million outflows during the month, reversing the net buying position of KSh 28.6 million recorded in September.
According to a report by the Capital Markets Authority, foreign investors scaled down on their investments at the Nairobi bourse, with 8,520 as at the end of September from 8,549 investors by the end of June 2024 and 8,614 investors at the end of 2023.
Improved economic conditions in the country coupled with improved earnings boosted investor confidence and led to higher stock prices in 2024. However, foreign institutional investors are yet to reverse their selling strategy, maintaining a net selling position in the period.
During the 10 months to October, 34 stocks advanced while 23 stocks declined, recovering from 2023 lows. According to data from AIB AXYS Africa, the market P/E ratio accelerated to 11.2x from 8.5x at the beginning of the year mirroring enhanced capital gains and dividend yields.
