Foreign investors start year with sale of banks, EABL stocks
10 months ago, 9 Jan 09:50
Foreign investors started off the New Year in a net selling mode, taking out a net of Sh176 million from the stock market last week as they sold off banking stocks and the EABL stock. Market data compiled by Standard Investment Bank (SIB) at the end of the first week of trading in 2018 shows the trend has continued from last year, when the foreigners sold Sh12.2 billion more than they bought in the market. They were also more active in the market last week than has been the norm in recent months, accounting for 73.3 per cent of equity turnover against a 2017 average of 63.3 per cent. This could, however, have been as a result of most funds and local retail investors making a slow return to trading after the festive period, which meant that last week had only four trading days. “Maintaining 2017’s trend, EABL had the highest net foreign outflows of $1.3 million (Sh134.3 million). The brewer, which is likely to announce its first half 2018 results at the end of this month, had the highest foreign net outflows of $42 million (Sh4.3 billion) in 2017,” said SIB in its latest weekly market report. “The banking sector experienced notable foreign net outflows with Equity Bank (Sh95 million), KCB (Sh90 million) #ticker:KCB and Barclays bank #ticker:BBK (Sh17 million) featuring in the top five foreign net outflows.” 6pc growth The brewer had recorded a six per cent net profit growth to Sh8.5 billion in the year ended June 2017, helped by cost-cutting and marginal sales growth. Like many industrial firms, however, it has been operating in a fairly difficult trading environment, affected by inflationary pressure and regulatory volatility. The foreign investors are also likely to be taking profits especially on bank stocks, having bought into this segment in late 2016 to mid-last year when the bank share prices were depressed due to the reaction to the rate cap. They were, however, actively buying Safaricom #ticker:SCOM last week, giving the telco a net inflow of Sh71 million last week. The company matched its all-time high closing price of Sh28 on Friday, buoyed by the higher demand from investors.
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