Kenya Equities Market Weekly Update – 6th June 2025

The Kenyan equities market extended its upward trajectory this week, posting broad-based gains across all major indices. Leading the charge was the NSE 10, which rose by 1.7%, followed closely by NSE 25 (+1.4%), NSE 20 (+1.3%), and the NASI, which posted a more modest 0.9% gain. This rally pushed the year-to-date (YTD) performance to +8.1% for NASI, +7.5% for NSE 20, +3.7% for NSE 25, and +3.3% for NSE 10, reinforcing the market’s slow but steady recovery.

What’s Driving the Momentum?

This week’s bullish sentiment was fuelled by notable gains in heavyweight counters:

• Equity Group jumped 4.4%, continuing its recovery trend.
• KCB Group advanced 3.0%, buoyed by positive investor sentiment in the banking sector.
• Safaricom rose 2.2%, reflecting renewed confidence in its long-term growth potential.

These gains were slightly offset by a 0.8% dip in Absa, which tempered some of the week’s gains but did not derail the broader positive movement.

Investor Participation Slows

Despite the index gains, market activity dipped. Weekly equity turnover fell by 29.2% to USD 10.2 million, from USD 14.5 million the previous week. This slowdown in traded volumes suggests investors may be taking a wait-and-see approach amid earnings season and macroeconomic developments. The YTD total turnover now stands at USD 340.1 million, indicating that market liquidity remains relatively constrained.

Foreign Investors Continue to Pull Back

Foreign participation was once again net negative, marking the third consecutive week of net outflows. Foreign investors offloaded USD 0.5 million worth of shares, an improvement from the USD 2.7 million recorded the previous week. This brings the YTD foreign net selling position to USD 33.3 million, nearly doubling the USD 16.9 million recorded over the same period in 2024.

The Bigger Picture

The sustained rally in select large-cap stocks and positive YTD index performance indicate improving investor sentiment. However, the subdued trading volumes and persistent foreign exits suggest that full investor conviction is still building. As Q2 earnings releases ramp up and macro indicators stabilize, the market’s next direction will likely hinge on sector-specific earnings surprises, monetary policy cues, and continued corporate actions.

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