Trading in government and corporate bonds on the Nairobi Securities Exchange has crossed Sh2.5 trillion for the year, the second year in a row it has reached that level, as investors keep favouring fixed income over shares.
Weekly bond turnover fell 35 per cent to Sh54.46 billion in the week to October 9, from Sh83.96 billion the week before, but the cumulative figure still passed the mark, The Kenyan Wall Street reported. With almost three months left in the year, the market is within reach of the record Sh2.71 trillion traded in 2025.
Shares lose ground
The equities side looked weaker. The NSE All Share Index fell 0.97 per cent over the week to 244.93 points, and market value dropped Sh40.06 billion to about Sh4.11 trillion. That took two-week losses to Sh60.06 billion.
Equity turnover slid 14.2 per cent to Sh1.96 billion. Foreign investors were net sellers in all five sessions, taking out Sh741.92 million. Their share of total activity shrank to 23.7 per cent from 40.1 per cent a week earlier, according to Standard Investment Bank.
Lender I&M was the week’s top gainer, up 6.1 per cent to Sh87.50. Nation Media Group, which accounted for 18.1 per cent of turnover, rose 2.3 per cent to Sh15.40. KCB Group fell 3.0 per cent to Sh89.75, Safaricom 2.2 per cent to Sh35.75 and Equity Group 1.4 per cent to Sh104.00.
Why bonds keep drawing money
The appeal of bonds is partly arithmetic. Treasury bills alone drew Sh75.4 billion in bids against Sh28 billion on offer in the latest weekly auction, and pension funds, banks and insurers have been locking in yields on longer government paper while the Central Bank holds its rate at 8.75 per cent.
Secondary trading in those bonds has also become more liquid, with banks actively switching between issues. That keeps turnover high even in weeks when new issuance is light.
Despite the past fortnight, shares remain well up for the year. The NASI is still about 31 per cent higher year to date, according to Standard Investment Bank’s data, which leaves room for profit-taking by foreign funds.
Traders will be watching the October 14 fuel price review, which feeds into inflation expectations and therefore into the yields bond investors demand.
Sources: The Kenyan Wall Street | Standard Investment Bank
Photo: Lebu Ayiga / Wikimedia Commons (CC BY-SA 4.0)
