- The last time the market recorded a net inflow position was in 2019, at Sh1.32 billion.
- During the quarter under review, the volume of shares traded decreased by 24.93 per cent to 812.07 million compared to 1.o8 billion.
Stock investors at the Nairobi Securities Exchange (NSE) lost at least Sh530 billion in paper wealth last year on capital flight as the shilling slid against major currencies.
This is according to the Capita Markets Authority (CMA) quarterly statistical bulletin for the period ended December 31, 2023, which shows the total market capitalisation at the Nairobi bourse closed at Sh1.43 trillion compared to Sh1.96 trillion same period in 2022.
In comparison, wealth erosion for the Nairobi bourse stood at 23.3 percent in 2022 amounting to Sh610 billion while the performance of the NSE 20 index was largely unchanged, having fallen by 10.3 per cent.
"The market capitalisation at the end of the quarter decreased by 3.27 per cent to Sh1.439 billion from Sh1.48 billion in the quarter ended September,'' the report says.
This means, the bourse only shed Sh50 billion in the three months to the close of the year, which was characterised by mass investor flight after the shilling shed 22 per cent against the US dollar.
The shilling closed the year at 156 units against the greenback, having shed close to 35 units within a year. On Tuesday, the shilling closed the day at a new record low of 162.50 units against the dollar.
Equity turnover in the review period dropped by 31.47 per cent to Sh11.8 billion compared to Sh17.2 billion in the previous quarter, confirming decreased trading activity in the market.
During the quarter under review, the volume of shares traded decreased by 24.93 per cent to 812.07 million compared to 1.o8 billion.
Trading at the top counter that measures 20 most liquid firms decreased by 0.5 per cent to 1,501.16 points from 1508.75 from Q3.2023, and the NSE All Share Index decreased by 3.27 per cent to 92.11 points by the end of the quarter.
While investors deployed hedging strategies, including single stocks and index futures to mitigate market risk in 2023, the Nairobi All Share Index (Nasi) declined by 27.7 percent as of December 2023 compared to a year earlier, the NSE 20 Share Index fell by 10.4 percent.
The share price for the big five firms at NSE, including Safaricom, East Africa Breweries Limited, Equity Bank, KCB and Cooperative Bank dropped, with some halving.
Safaricom's share has been on a downward spiral for almost two years now, dropping over 45 per cent in the past 12 months.
The telco's share traded at Sh13.65 towards the end of the year compared to Sh24.50 same period in 2022.
At its peak in mid-2021, when its share price touched an all-time high of Sh44.95, Safaricom accounted for up to 63 per cent of the NSE’s total investor wealth after defying the Covid-19 storm that battered stocks at the market.
Crossing the 50 per cent threshold meant that Safaricom’s market worth exceeded the combined valuation of all the other listed companies.
Equity Bank's share on the other hand closed the year at Sh36.50, having dropped 20.65 per cent in the past 12 months.
NSE data shows that in the 12 months to December 2023, foreigners had withdrawn a net of Sh24.74 billion from the bourse, taking the cumulative net sales since the beginning of 2020 to Sh87.3 billion.
The last time the market recorded a net inflow position was in 2019, at Sh1.32 billion.
In the bond market, the turnover decreased by 29.81 per cent with Sh137.78 billion worth of bonds being traded compared to Sh196.30 billion traded in Q3 of 2023, revealing decreased activity in the Bond Market during the quarter.