UPDATE 1-Kenya Airways weighs on share index after results

Wed Jun 25, 2014 10:44am EDT

(Adds stock market movements, closing shilling report)
    NAIROBI, June 25 (Reuters) - Shares in Kenya Airways
 tumbled on Wednesday after results showed it was
adding capacity faster than increasing passengers, driving the
benchmark stock index lower, while the shilling recovered
earlier losses to end little changed.
    The benchmark NSE 20 Share Index closed down 0.2
percent at 4,845.60 points. 
    Kenya Airways narrowed pretax losses in its year ending
March, but analysts noted a lower load factor - 65.6 percent
down from 68.7 percent a year earlier - suggesting it was not
attracting passengers as fast as it was building its fleet.
    "When they bring in more capacity with the falling load
factor, it is a challenge to the outlook," said Eric Musau, a
research analyst at Standard Investment Bank. "For us that is
really one of our key concerns we have with the airline."
    The shares fell 6 percent to 10.85 shillings per share.
    Safaricom also fell, dropping to 12.55 shillings
from 12.65 shillings, with traders suggesting it was under
pressure due to concerns about the impact of competition in the
mobile money market.
    Safaricom, Kenya's leading mobile provider, has dominated
mobile money with its pioneering M-Pesa product, but rivals
including the local Equity Bank bank are muscling in
with new services.
    On the currency market, the shilling recovered some
early losses to close at 87.40/60 to the dollar, compared with
87.45/55 at Tuesday's close. It had traded around 87.65/75
earlier on.
    "We saw demand for dollars ease off at the higher level, and
liquidity tightness supporting the shilling," said one trader at
a Nairobi commercial bank. "We saw some flows from exporters,
who took advantage at higher levels and helped recoup losses."
    He said the currency had support below the 87.70 level as
long as a liquidity squeeze continued, which is partly due to
corporate demand for shillings as tax payments fall due.
    In the debt market, bonds worth 3.72 billion shillings were
traded, up from a volume of 2.59 billion shillings the previous
day. 
     
               ...........................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
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 (Reporting by Drazen Jorgic, Duncan Miriri and Edmund Blair;
Writing by Edmund Blair; Editing by Alison Williams)