Wednesday, March 13, 2013

Kenyan shares rise another 4 pct on peaceful poll

By Kevin Mwanza

NAIROBI (Reuters) - Kenya's stock market soared 4 percent on Tuesday, extending a two-session surge after a largely peaceful presidential poll outcome, while the shilling firmed against the dollar.

The benchmark NSE-20 share index rallied to 4,985.91 points, a new 4-1/2 year high last touched in July 22, 2008.

Some of the biggest risers in the index were Equity Bank, the country's biggest bank by customers, the main electricity producer KenGen and retailer Uchumi Supermarket, whose shares all rose more than 7 percent.

Shares in only three companies out of 58 listed in the Nairobi All Share index declined in value.

"Activity is upbeat, backed by a return of foreigners and institutional investors as confidence improves after the elections," said Faith Atiti, an analyst at NIC Securities.

Uhuru Kenyatta, the son of Kenya's founding president, won the presidential election with 50.07 percent of the vote, the country's election commission said on Saturday, which was just enough to avoid a run-off after a race that had divided the nation.

The results, and the peace that followed, has sent Kenya's benchmark share index rallying nearly 7 percent in two sessions to extend its gains year to date to 16 percent.

In the foreign exchange market, the shilling once again firmed against the dollar to close at 85.25/45, compared with 85.40/60 on Monday.

"We've seen flows from the tea guys, while demand has been lacklustre. Most customers had covered their dollar needs ahead of the election," said Duncan Kinuthia, head of trading at Commercial Bank of Africa.

The shilling did not react to an MPC decision later in the session to hold the key interest rate for the first time since July 2012 as it buys time to assess the state of the economy after the election, whose outcome will be challenged in court.

All 11 analysts and traders polled by Thomson Reuters said they expected the central bank to hold its benchmark rate.

"I think the central bank will hold off until the election-related splurge and its attendant price spikes fall off the data radar before making their next move," said Aly Khan Satchu, an independent analyst.

"To cut ahead of the decision before the Supreme Court would not be politically smart in my view."

The local currency gained 1 percent in two trading sessions after the election results were announced. It is up 1 percent against the dollar since the start of the year.

In the debt market, bonds worth 530 million shillings were traded, down from 721 million shillings on Monday.

Source: http://news.yahoo.com/kenyas-main-share-index-surges-4-pct-peaceful-140929859--finance.html

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