NAIROBI: The Kenyan shilling rose against the dollar on Tuesday on the back of hard currency inflows from investors abroad seeking high yields from local Treasury bonds.
Stocks gained ground for the seventh-straight session with the all share index closing at a new record high.
The shilling closed at 91.30/50 per dollar, up from Monday's close of 91.50/60.
"(It strengthened) on the back of inflows attributed to investors chasing yields with the bonds that are coming up," said a trader at a commercial bank.
The dollar inflows were targeting the sale on Wednesday of a two-year and re-opened 10-year Treasury bonds worth a total 25 billion shillings ($273.37 million).
In the stock market, the all share index closed at a fresh record high of 172.90 points, led higher by gains in mid- and small-cap companies.
Agriculture firm Kakuzi Ltd surged nearly 10 percent to close at 291 shillings per share.
"This shows the rally is really broadening out to the intermediate and small cap companies," said Aly Khan Satchu, an independent trader and analyst.
This year's rally has been driven by foreign funds looking for investments elsewhere in Africa after Nigerian markets tumbled, in a rout triggered by weak oil prices.
Benign economic fundamentals like lower inflation due to the drop in the price of crude oil have also enhanced the appeal of Kenyan equities this year.
In the debt market, bonds worth 1.4 billion shillings were traded, up from Monday's volume of 725 million shillings.
Comments
Comments are closed for this article.