UPDATE 1-Kenyan stocks close higher, shilling steady

Wed Mar 12, 2014 11:03am EDT

* Main share index reverses losses to close higher
    * Shilling seen supported by farm sector flows

 (Adds markets close, stocks, bonds)
    By George Obulutsa
    NAIROBI, March 12 (Reuters) - Banking stocks pushed Kenya's
main share index higher on Wednesday, with investors encouraged
by strong earnings results and upcoming dividend payments on
banking shares.
    The shilling held steady.
    On the Nairobi Securities Exchange, the main NSE-20 Share
Index closed up 19.97 points, or 0.41 percent, at
4,935.81 points.
    Financial institutions like KCB Bank Group(KCB),
CFC Stanbic Holdings and Co-operative Bank 
all saw solid gains. 
    Telecoms firm Safaricom, which is typically the
most traded stock on the bourse, also rose.
    KCB and CFC Stanbic both posted healthy growth in their
full-year pretax profits for 2013, while Co-operative Bank is
expected to follow the same trend.
    CFC Stanbic jumped 4.6 percent to close at 114 shillings,
while KCB ended the session 1.1 percent higher at 46.25
shillings.
    Co-operative Bank was up 0.53 percent to finish trade at
18.90 shillings a share.
    "What we have generally seen is some upward demand for
banking counters. People coming in to take positions in
preparation for the dividend payments. Some of them are closing
their books between March and May," Daniel Kuyoh, research
analyst at Kingdom Securities, said.
    "For the banks that have released results we saw a positive
performance. Some of the banks performed better than expected."
    Safaricom ended the session up 0.8 percent at 11.90
shillings after jumping 2.5 percent to near a one-and-a-half
month high of 12.10 shillings.
    Safaricom has said it has entered into talks to buy assets
of another telecom firms Essar Telecommunications, and analysts
say that and expectations for robust full-year earnings, have
made the stock attractive to investors. 
    "We generally should see that trend continue in the next
trading session," Kuyoh said.
    At the close of foreign exchange trade at 1300 GMT,
commercial banks quoted the shilling at 86.40/50 to the dollar,
barely changed from Tuesday's close of 86.30/40, and from
86.45/65 where it traded earlier in the day.
    Andlip Nazir, senior trader at I&M Bank, said central bank
liquidity mop-ups throughout the week have helped the shilling
but dollar demand was offsetting some of that support.
    "We are seeing demand from manufacturing. I think it should
pick up from next week," Nazir added.
    The central bank was in the market and mopped up 6.1 billion
shillings ($70.68 million) at a weighted average rate of 6.276
percent. It had sought to mop up 10 billion shillings, central
bank data showed.
    Dollar sales by the agriculture sector were also expected to
boost the currency of east Africa's biggest economy.  
     "We anticipate the shilling to remain well supported as
inflows from the farm sector continue to trickle into the
market," Commercial Bank of Africa said in its daily report. 
    The shilling, which has gained 0.2 percent versus the dollar
so far this year, is expected to trade in the 85.90 to 86.90
range in coming days.
    On the secondary market, government bonds valued at 2.84
billion shillings were traded, compared with 1.99 billion
shillings traded on Tuesday.
    
               ...........................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 = 86.3000 Kenyan Shillings)

 (Reporting by George Obulutsa; Editing by Drazen Jorgic and
Susan Fenton)
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