The Nairobi Securities Exchange on Friday fell to a four year low. This followed a dip by the NSE blue-chip index, NSE 20 Share Index, to 3,515 points, a level that was last seen in April 2012.
This means that the NSE 20 Share Index year-to-date return now stands at a negative 13 per cent.
In the same vein, the NSE has shed Sh53.4 billion in market capitalization to Sh1.996 trillion since January. “Quite a good part of the fall in the market prices can be attributed to the poor financial performance of a number of companies. We have seen the negative news coming from Mumias Sugar, Uchumi, Kenya Airways and others. This has contributed to the fall in prices,” said Paul Mwai, chief executive of AIB Capital.
During this period, only Safaricom has managed to weather the storms of low prices on NSE. Over the past one month period, Safaricom has gained by 0.6 per cent.
The poor performance by the market is expected to continue in the short term. “We expect further weakness in overall market to continue in the short-term, on the back of relatively high sell side activity from foreigners,” said Faida Investment Bank in their latest weekly market report.