UPDATE 1-Kenyan shilling holds steady, shares bounce back up

Tue Nov 20, 2012 9:49am EST

* Shilling's short-run outlook bearish
    * Safaricom shares lift bourse

 (Recasts with markets close, stocks)
    By Kevin Mwanza
    NAIROBI, Nov 20 (Reuters) - The Kenyan shilling held
steady on Tuesday but traders said demand for the dollar from
importers meant the local currency's short-term outlook remained
bearish.
    On the country's stock market, Safaricom led
shares to break a two-day losing streak.
    At the 1300 GMT market close, the shilling was posted at
85.70/80 per dollar, barely changed from Monday's 85.60/80.
    "The shilling's outlook is possibly weaker. We expect some
tea exporters inflows ... but after that it could be pressured
by importers," said Duncan Kinuthia, head of trading at
Commercial Bank of Africa.
    Tea, which is the leading foreign exchange earner in east
Africa's biggest economy, is auctioned every Tuesday at the port
city of Mombasa.
    Market players said they expected the shilling to weaken
past 86.00 by the close of the month. 
    However, the pressure on the currency would continue to be
offset by the central bank's efforts to mop up supplies of the
currency in the banking sector, they said. 
    The bank has actively pulled liquidity from the market via
repurchase agreements to prop up the shilling, and has steadily
reduced interest rates from last year's high of 18 percent.
    It mopped up 8.2 billion shillings ($95.8 million) on
Tuesday, after it received 11.2 billion shillings in bids for
the 10 billion it had offered in repos. 
    At the Nairobi Securities Exchange, the main NSE-20 Share
Index rose 0.3 percent to 4,158.38 points, lifted by a rise in
shares in leading telecoms firm Safaricom due to signs
of stronger full-year earnings.
    Safaricom, one of the most traded stocks in the Nairobi
bourse and the second-most capitalised on the bourse, rose 3.3
percent to 4.75 shillings per share, accounting for 74 percent
of Tuesday's traded volume.
    "Investors are still bullish about Safaricom's full year
performance results after they forecast double-digit growth in
revenue," said Faith Atiti, an analyst at NIC Securities.
    The telecom company revised upwards its estimate of
full-year revenue growth to about 12 percent from low-to-middle
single digits, after it reported a 113 percent rise in its first
half pretax profit to 11.5 billion shillings. 
    In the debt market, government and corporate bonds worth 796
million shillings were traded, up from 758 million shillings on
Monday.
               ...........................Shilling spot rates
                  .....................Shilling forward rates
                           .......................Cross rates
         ..................................Local contributors
           .......................Central Bank of Kenya Index
          .....................Kenyan Bonds contributor pages
                          ...............Treasury bill yields
        ..................Central bank open market operations
        .........................Horizontal repo transactions
         ,       ................Daily interbank lending rate
              .............................Kenya Bond pricing
             ..................Real time Africa economic data
 <ECI & AFR> ...........................African economic news
          .................................NSE-20 Share Index
         .................................NSE All Share Index
             ...........................FT NSE Kenya 15 Index
             .......................... FT NSE Kenya 25 Index
  SPEED GUIDES:
                                    
            
  ($1 = 85.6250 Kenyan shillings)

 (Editing by James Macharia and Patrick Graham)