February 12, 2014 / 2:56 PM / 4 years ago

UPDATE 1-Kenyan shilling eases, stocks edge higher

* Main share index up slightly, lifted by bank stocks
    * Shilling ends session weaker as dollar demand rises

 (Adds stocks, bonds, market close)
    By George Obulutsa
    NAIROBI, Feb 12 (Reuters) - The Kenyan shilling 
weakened against the dollar on Wednesday, undermined by
corporate demand for greenbacks. Stocks gained, led by banks.
    At close of trade at 1300 GMT, commercial banks quoted the
shilling at 86.25/35 to the dollar, compared with Tuesday's
close of 86.15/25.
    "There was some corporate demand that pushed it up, and lack
of any dollar inflows into the market," said Sheikh Mehran, a
senior trader at KCB Bank Group. "It was just corporate buying
that made interbank players cover short positions."
    The currency of east Africa's biggest economy has been stuck
in a rut amid sluggish corporate demand for dollars. It bucked
the trend among major African currencies like the Ghanaian cedi
and the South African rand, which came under immense pressure
during the recent emerging-market sell-off.
    Chris Muiga, a trader at National Bank, said the shilling
would be supported by dollar inflows from agricultural exporters
for the rest of the week, keeping it within its recent range.
    "We will stay in the comfort zone until fresh factors
emerge," he said.
    Traders said the shilling was also under pressure from
increased liquidity in the money markets. The weighted average
interbank lending rate eased to 9.2185 percent on Tuesday from
11.8514 percent at the end of January.
    On the Nairobi Securities Exchange, the main NSE-20 Share
Index closed 8.86 points, or 0.2 percent, higher at
4,842.22 points.
    Banking stocks led the index, as investors anticipated 
banks would report improved earnings for 2013. Kenya Commercial
Bank rose 0.6 percent to 45.00 shillings. Co-operative
Bank ended 1.7 percent higher at 17.90 shillings.
    "Banks continued moving higher. This week we started seeing
local investors buying into the banks a bit, and that momentum
picked up yesterday. I guess a bit of speculation ahead of the
numbers being released," said Eric Musau, a research analyst at
Standard Investment Bank.
    On the secondary market, government bonds valued at 393.3
million shillings were traded, from 1.02 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:
                                    
            
 
 (Additional reporting by Duncan Miriri; Editing by Larry King)
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