The impact of interest caps has taken effect
The British High Court has ruled that the Prime Minister Theresa May must seek Parliamentary approval before triggering Article 50. This news sent sterling on a sharp run higher and was last at 1.2477 versus the dollar. Egypt devalued its currency by 48 per cent in order to extinguish the black market and qualify for $12 billion worth of loans from the International Monetary Fund.
President Muhammadu Buhari will be capitulating imminently – either that or the Nigerian economy is completely asphyxiated. According to my records at http://rich.co.ke the Nairobi Securities Exchange had an outage from 13:45 and by that time Sh551.459 million worth of business had been transacted.
Closing prices have been therefore delayed as I file this. Tomorrow is a big set piece day for the NSE as Safaricom will be issuing half-year earnings pre-market opening. Safaricom has also begun testing its M-Pesa debit cards. Safaricom rallied a robust +2.41 per cent to close at Sh21.25 and traded 21.718 million shares worth Sh461.485 million. Safaricom has returned +39.202 per cent in 2016 (considerably outperforming the All Share which is -5.00 per cent) over the same dates. My year end price target from early January was Sh22.50.
Kenya Airways firmed +0.75 per cent to close at Sh6.70 and traded 648,800 shares. Kenya Airways has rallied +36.73 per cent in 2016.
TPS Serena was well traded with 677,200 shares traded and closed unchanged at Sh18.00. This is a multiyear low level and there has been plenty of price action at these price levels of -28.00 per cent year to date.
James Mwangi announced today ‘’the customer has declared the branch dead’’ as he released Equity Bank’s third quarter earnings where Equity Bank reported a profit after tax of Sh15.1 billion (+16.6 per cent y/y) for 3Q16. The impact of the interest caps on lending and deposit rates took effect towards the end of 3Q’16 (mid-September 2016). The loan book grew by 3.0 per cent to Sh271.4 billion and customer deposits increased by 3.8 per cent y/y to Sh331.3 billion. Third quarter investment securities clocked 93.097340 billion vs 51.495493 billion +80.787 per cent, signalling Equity has bought a large chunk of government securities. Equity firmed +0.82 per cent to close at Sh30.75 and traded 27,900 shares. There was buy side interest for 1000 per cent more shares than were traded.
Kenya Commercial Bank firmed +0.7 per cent to close at Sh28.00 and was trading at 28.50 +2.7 per cent at the finish line. KCB traded 300,100 shares. KenolKobil rallied +1.69 per cent to close at a 2016 high of Sh12.00 and traded 243,900 shares.