UPDATE 1-Foreigners push Kenyan shares to three-week high

Fri Sep 20, 2013 10:21am EDT

* Safaricom hits new all-time high mid-session
    * Shilling seen targeting 87, but not breaching it

 (Recasts with stocks, adds market close)
    By Richard Lough
    NAIROBI, Sept 20 (Reuters) - Kenyan shares hit a three-week
high on Friday as local investors who had been supplying
liquidity this week sat tight in the face of strong offshore
demand, pushing prices higher, traders said.
    Kenya's benchmark NSE-20 Share Index climbed for a
fourth straight session, adding 0.1 percent in the day to close
at 4751.82 points.
    Safaricom and banks led the winners. 
    Safaricom, east Africa's biggest telecoms firm and
frequently Kenya's most traded stock, struck an all-time high of
8.70 shillings during the session before falling back. It ended
the day up 1.8 percent at 8.50 shillings. 
    Standard Chartered Bank Kenya  rose 1.4 percent to
end trading at 299 shillings per share, while Equity Bank
 gained 0.7 percent to close at 33.75 shillings.
    "Foreign investors came in strongly," said Ian Gachichio,
research analyst at Kestrel Capital. "Local investors who have
been supplying liquidity in the market this week generally held
off." 
    "They've seen prices come up, so they're waiting to lock in
the best prices. That led prices up and foreign investors had to
pay up."
   Offshore appetite for Kenyan stocks had intensified since the
U.S. Federal Reserve's surprise decision on Wednesday to delay
winding down its stimulus programme, brokers said.
    On the foreign exchange market, the shilling closed
trading up 0.1 percent at 87.25/35 and currency traders said the
local currency may struggle to strengthen beyond 87 to the
dollar. 
    "The 87 level is a realistic target, but breaching it is
another story," said Peter Mutuku, head of corporate trading at
Bank of Africa Kenya, adding that dollar demand was seen picking
up towards the end of the month.
    Strong foreign investor demand for a 12-year infrastructure
bond worth up to 20 billion shillings on sale next week was
expected to support the shilling, traders said.
    "I do see inflows coming in ... for the IFB (infrastructure
bond)," said Sheikh Mehran, senior trader at Kenya Commercial
Bank.
     
               ...........................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:
                                    
            
 
 (Additional reporting by George Obulutsa; Editing by James
Macharia/Ruth Pitchford)
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