UPDATE 1-Kenyan shilling, shares keep up winning streak

Mon Sep 30, 2013 11:57am EDT

* Shilling firms on offshore dollar inflows after bond sale
    * Importers' dollar demand could weigh shilling down
    * EABL shares gain ahead of dividend book closure

 (Adds markets close, stocks)
    By Kevin Mwanza
    NAIROBI, Sept 30 (Reuters) - The lingering impact of last
week's infrastructure bond sale kept the Kenyan shilling 
in positive territory on Monday, while shares gained for the
third straight session.
    By the 1300 GMT close, commercial banks quoted the shilling
at 86.00/20 per dollar, 0.46 percent stronger than Friday's
close of 86.40/60.
    Duncan Kinuthia, head of trading at Commercial Bank of
Africa, said foreign investors were still selling dollars to pay
for the 12-year infrastructure bond worth 20 billion shillings
auctioned in the middle of last week.
    The shilling has been buoyed by dollar inflows for the bond
amid tight liquidity in the market, shrugging off an attack by
Islamist militants at a Nairobi mall that killed dozens of
people. 
    Traders said the shilling could come under pressure if
importers take advantage of these gains to buy dollars. 
    However, a jump in inflation in September was likely to
cushion it if interest rates rise, making it attractive to hold
the local currency.
    Year-on-year inflation spiked to 8.29 percent in September,
from 6.67 percent in the previously month, mainly due to
lawmakers widening the bracket of goods subject to value-added
tax. 
    On money markets, the weighted average interbank lending
rate rose for the 14th straight session on Friday, to 9.3857
percent, from 9.1203 percent on Thursday. 
    "Importers are waiting on the sidelines to see how far the
shilling can gain before they come in to buy dollars," Kinuthia
said. 
    In stocks, the benchmark NSE-20 share index rose
0.5 percent to 4,793.20.
    Shares in East African Breweries, one of the most
heavily-traded firms, rose 3.5 percent to 329 shillings as
investors rushed to lock in its dividend before books closed on
Monday.
    "EABL closes its books today ahead of a 4 shilling a share
dividend payment. That might have sparked the participation
today," said Sila Rasugu, an analyst at Genghis Capital.
    East Africa's biggest telecoms firm Safaricom 
climbed 1.8 percent to 8.50 shillings.
    In the secondary bond market, debt worth 808 million
shillings ($9.3 million) was traded, up from 571 million on
Friday.
               ...........................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 = 86.6000 Kenyan shillings)

 (Editing by James Macharia)
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