NAIROBI, Kenya, April 19 – The Nairobi Securities Exchange(NSE) lost Sh229 billion in investor wealth in the quarter ended March 31 2023 as investors sought safer investments in other markets following a bearish run at the exchange.
According to the Capital Markets Authority(CMA) Q1 2023 Statistical bulletin, NSE market capitalization declined by 11.57 per cent to stand at Sh1.75 trillion in the quarter, down from Sh1.98 trillion recorded in Q4 2022.
The decline saw the NSE 20 Share and the NSE All Share Indices decrease by 3.22 and 11.54 per cent respectively recording 1,622.05 points and 112.76 points respectively at the end of the quarter.
During the quarter, the bulletin shows that the number of local individual investors dropped from 1,936,795 to 1,936,412 while local corporate investors dropped from 74,558 to 74,334.
Further, foreign individual investors dropped to 13,799 from 13,814 while foreign corporate investors dropped to 1,008 to 1,063.
In the quarter, average foreign investors participation was 41.24 per cent compared to 54.84 per cent recorded in Q4.2022, implying a 13.60 per cent decrease.
This saw net foreign portfolio outflows surge to Sh13.93 billion as compared to an outflow of Sh4.87 billion in Q4.2022.
Despite the decline in capitalization, equity turnover for Q1 2023 stood at Sh44.82 billion, a 156.71 per cent increase compared to the Sh17.46 billion registered in Q4 2022.
In the equity market, the volume of shares traded increased by 71.33 per cent to 1.08 billion in Q1.2023 compared to 634.17 million recorded in Q4.2022.
The volume traded also showed a 44.25 per cent year-on-year increase compared to 753.20 million traded in Q1 2022.
As for the derivative market, it recorded a decline in turnover, closing the quarter at 20.63 million from 22.00 million recorded in Q4 2022, a 6.23 per cent decrease.
The number of deals during the quarter under review also decreased by 17.48 per cent down to 255 deals from 309 deals registered in Q4 2022.
“The first quarter of the year has seen a mix of positive and negative trends, particularly in the bond, equity, derivative, and collective investment schemes markets. Despite the downturn in economic growth and high inflation, the government’s efforts to stabilize public finances and boost investor risk appetite have instilled confidence in the market,” said CMA CEO, Wyckliffe Shamiah.
