Abacus Wealth Management

Monday Brief – 23rd Feb

Banks, insurance stocks slow down in first quarter

NSE inches toward seven-year high on Safaricom’s gains

The Nairobi bourse shrugged off negative effects of the capital gains tax controversy to hit a seven year high on Friday with demand aided by a highly liquid money market. The NSE 20 share index closed at 5,465 points, the highest since June 2008, with market capitalisation standing at Sh2.45 trillion. This has been largely caused by a rise in Safaricom shares which on Friday set a new all-time trading peak of Sh15.50 with other blue chips like East Africa Breweries Ltd (EABL) and Equity Bank gaining too last week […]

Dividend drought looms as 12 firms in profit warning

Profit warnings from companies listed at the Nairobi Securities Exchange for their 2014 performance have increased to a record 12, signaling a dividend drought and share price erosions. Investors in the companies that have issued profit warnings are set to get lower or no dividend this year, besides suffering share price erosion. Most companies retain most of their earnings to fund new investments and strengthen their financial position, with lower profits leaving even less cash to be distributed as dividends. Only a few firms like British American Tobacco pay out their entire profits as dividends […]

CBK backs cheap oil imports to shore up shilling

Central Bank of Kenya (CBK) has discounted predictions that the shilling will lose against the dollar, citing reduced import bill to contradict Citi and a host of market analysts. Central Bank of Kenya indicated that it is basing forecast of a stronger local currency on the dropping fuel prices that should result in a lower import bill. On Friday, the shilling traded at 91.4 to the dollar, a marginal decline from the previous day 91.36. Central Bank is also taking comfort in high foreign currency reserves arising from cash received in the two sovereign bond sales made last year […]

Kenya shilling best performing regional currency

The shilling has gained on its East African peers to emerge the best performing regional currency so far this year helped by a wider export base and strong investor inflows. The Ugandan shilling has depreciated by 9.7 per cent this year to its Kenyan counterpart to exchange at 31.34 units, while the Tanzanian shilling is exchanging at 20.02 units to the Kenya shilling representing a 6.6 per cent depreciation. In terms of trade, the weakening of regional currencies to the Kenyan shilling and the dollar creates concern for exporters given that the East African countries form Kenya’s biggest export […]

Consumers pay more for power despite promises of lower tariffs

The effects of a drop in the international crude oil prices and increased injection of power into the grid is yet to reflect on the monthly electricity bills for consumers. Many power users are disappointed that their expectations of big drop in power prices are yet to be realized. Figures from Kenya Power indicate only a slight drop in the fuel cost component from Sh2.53 per Kwh in January to Sh2.51 in February this year. However, soaking all the benefits arising from cheaper crude oil prices, the shilling exchange rate against the US dollar has depreciated to 91.4217 from the SH85 to Sh89 level it has been oscillating over the past few months […]

 

 

 

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