Bearish sentiment protracts

Bearish sentiment protracts continues being the dominant theme in the Kenyan equities markets as uncertainty clouds economic and business recovery from the effects of the ongoing global Covid-19 pandemic. On a year-to-date (YTD) basis, the Nairobi Securities Exchange 20-Share Index (NSE-20) and Nairobi Securities Exchange All Share Index (NASI) have posted negative returns of 24.2% and 14.1%, respectively. Notable out-performers YTD are Barclays ETF Gold (+22.1%), a security whose value is pegged on the value of gold (a safe haven asset); Kenya Airways (+39.5%) on a recent price rally; and Carbacid Investments (+12.0%). On month-to-date basis (MTD), there have been outstanding outperformers (Flame Tree Group 56.4%, Britam +47.3% and Kenya Power +30.9%). The key index counters, in particular in the banking sector, have retreated sharply, with Equity Group and KCB Group down 34.9% and 35.2% YTD, respectively.  Also Read: Africa’s four MEGA TRENDS that are overcoming the global pandemic The bearish market coupled with uncertainty around resolution of the Covid-19 pandemic, has shifted investors’ risk appetite with the accumulation and price rally of the safe haven asset in global markets, gold, recently trading close to its five-year high level (USD 1,721/ounce).   At the local bourse, the Barclays NewGold ETF is the best performer up 22.1% this year.