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3 years ago
UPDATE 1-Kenyan shilling eases, shares rise on Safaricom acquisition
September 2, 2014 / 2:05 PM / 3 years ago

UPDATE 1-Kenyan shilling eases, shares rise on Safaricom acquisition

4 Min Read

* Shilling eases slightly on energy, manufacturing demand
    * Stocks end higher, Safaricom helps

 (Adds shilling closing level, stocks, bonds)
    By George Obulutsa
    NAIROBI, Sept 2 (Reuters) - The Kenyan shilling eased
slightly on Tuesday on end-of-month dollar demand, while stocks
closed higher on news of an acquisition by telecoms firm
Safaricom.
    At the close of trade, commercial banks quoted the shilling
at 88.60/70 to the dollar, compared with Monday's close of
88.50/60.
    "There was some end-month dollar demand that came through,
mainly from oil and also manufacturers. At the same time there
were no dollar inflows from tea," said Martin Runo, senior
trader at Chase Bank.
    Runo said the shortage of local currency in the market had
eased somewhat, leading to the emerging dollar buying.
    Traders said the central bank took back the 30 billion
shillings it had injected last week using reverse repurchase
agreements into a tight money market last week.
    The bank stayed out of the market on Tuesday.
    Traders said the liquidity conditions had improved due to
government departments starting to spend money from the 2014/15
(July-June) fiscal budget.
    Delays by the government to release funds to departments and
local authorities led to a liquidity crunch, leading to
overnight borrowing rates on the interbank market shooting up. 
    Traders said they forecast the shilling to trade in the
88.20-89.00 range in coming days.
    On the Nairobi Securities Exchange, the main NSE-20 Share
Index was up 0.4 percent or 22.29 points to close at
5,163.21 points.
    Safaricom, which has a heavy weighting on the benchmark
NSE-20 share index, rose 0.4 percent to close at 13.20
shillings. The stock had jumped to an intra-day high of 1.9
percent earlier to 13.40 shillings in the session, a level it
last hit in mid-April.
    The company, alongside the Kenyan unit of Bharti Airtel
 have signed agreements to buy assets of another local
telecoms firm, yu Mobile. 
    "It's more of the fact that they are acquiring assets from
yu and the transaction has made progress and is now confirmed,"
Ian Gachichio, research analyst at Kestrel Capital, said.
    "It's a positive thing because they are receiving additional
frequency spectrum which they need to launch 4G and also improve
their quality of service." 
    On the secondary market, government bonds valued at 3.86
billion shillings ($43.57 million) were traded, up from 1.32
billion 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 US dollar = 88.6000 Kenyan shilling)

 (Editing by James Macharia)

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