Business
Kenya’s Nairobi Securities Exchange in 2nd best performer in Africa & Middle East
Traders on the floor of the Nairobi Securities Exchange
Annual market performance statistics released by the Nairobi Securities Exchange indicate that the benchmark the Nairobi Securities Exchange (NSE) 20 Share Index — a key indicator of the market performance, rose by 28.95 percent to close at 4,133.02 points.
The index closed at 3,205.02 points at the end 0f 2011. The gain places the Nairobi Securities Exchange as the second highest gainer among the stock exchanges in Africa and Middle East, after the Egyptian Stock Exchange, and eighth globally.
The All Share Index was even higher at 39.41 percent but it is yet to gain market acceptance as a representative of the market performance, largely due to the short period it has been in the market compared with the NSE 20 Share Index.
Market valuation
In terms of market valuation, the stock market closed the year at KSh1.27 trillion (US$ 14.7 billion) against Sh868 billion (US$ 10.06 billion) posted at the close of year 2011.
Growth in investor confidence has defied past trends where an election period is characterized by capital flight as investors move their money to other countries owing to fear of political uncertainty. Low inflation, falling interest rates and stable currency, compared with last year, has also played a key role in price rally.
From a high of 18.93 percent in December 2011, inflation has for 13 consecutive months fallen to 3.2 percent in December last year.
The Kenya shilling closed the year at an average rate of KSh84.6 against the US dollar during the same period, from a low of KSh107 in 2011, with interest rates falling to average 18 percent from highs of over 24 percent.
