Kenya’s equity market faces turbulent times, says Capital Markets Authority
Kenya’s Capital Markets Authority has painted a negative outlook for the stockmarket in the fourth quarter of this year due to prolonged political uncertainty, interest rate caps and the country’s rising public debt, which could trigger a downward review of Kenya’s sovereign credit rating. While a lower interest rate is expected to stimulate activity on the exchange, concerns among shareholders over the future profitability of banks due to lower lending rates has led to investors dumping banking stocks. During the nine-month period to September 30, foreign investors exited the market by selling shares valued at Ksh11.12 billion ($111.2 million) compared with purchases of Ksh6.02 billion ($60.2 million). The month of September recorded the highest level of foreign sales at Ksh5.79 billion ($57.9 million).