Kenya's equities & bond market review

Kenya's equities market closed Monday's trading session with a remarkable turnover increase of 142.50 per cent, surging to KES313.85 million from KES129.42 million. This surge has caught the attention of many investors, both domestic and foreign, seeking opportunities in the Kenyan market. To provide a comprehensive performance update, Teddy Irungu, Research Analyst at Genghis Capital Asset Management, shared valuable insights on the driving factors behind the surge in foreign investor activity in the Kenyan equities market. Irungu highlighted several key factors contributing to the growing interest in Kenyan equities, including improving macroeconomic conditions, stable political environment, and potential interest rate cuts by the U.S. Federal Reserve. According to Irungu, the inflation rate dropping to around 4 per cent and stability in the exchange rate have boosted investor perception of Kenyan equity counters, leading to increased investments in the market. Additionally, signs of political stability following the unrest in June and July have further enhanced investor confidence. Irungu also noted a shift in capital from developed markets to marginal frontier markets, with Kenya benefiting from this trend as investors seek higher returns. Given the underpricing of Kenyan equities due to past inflation and exchange rate fluctuations, foreign investors perceive this as an opportune moment to enter the market and capitalize on potential growth.