The Nairobi Securities Exchange(NSE) recorded growth in turnover and investor wealth in the second quarter of 2021 despite Covid-19 disruptions.
The latest CMA soundness report shows that equity turnover at the NSE rose by 19.7 per cent to Sh37.98 billion in the second quarter of 2021 up from Sh31.73 billion in the previous quarter.
Investors' wealth, measured by market capitalisation, recorded a 10.88 per cent increase to stand at Sh2.7 trillion during the period, the report shows.
The number of shares traded during the period increased to Sh1.1billion from Sh997.75 million in the previous quarter.
“The theme for this quarter 'Sustained capital markets recovery on the back of renewed optimism in economic growth', aptly captures the resurgence in capital markets activity premised on economic recovery ,” said Luke Ombara Director, Policy and Market development, CMA.
The bond market turnover increased significantly by 36.04 per cent with Sh271.24billion worth of bonds traded during the second quarter of 2021 compared to Sh199.38billion worth of bonds traded in the first quarter of 2021.
The share of traded turnover attributed to foreign investors at the NSE on the other hand fell to a three-year low in the second quarter.
The CMA report shows that foreign investors accounted for 54.74 per cent of all traded turnover last month, the lowest since May 2018’s 50.98 percent.
The drop however reflects growing confidence in the market among local investors.
Local investor participation had tailed off in recent years due to a prolonged price declines in the market.
The regulator noted that the socio-economic disruption posed by the Covid-19 pandemic and its dampening impact on capital markets activity remained a key risk during the quarter.
“Progress on vaccinations during the quarter and reopening of the economy after easing of containment measures imposed to control spread of the virus in the third wave of the pandemic, improved investor sentiment at the NSE,” CMA said.
