This archive report was first published on 3 August 2020.
On August 3, 2020, the Nairobi Securities Exchange (NSE) witnessed a significant decline in the value of blue chip stocks due to foreign investors withdrawing Sh21.4 billion in the six months to June.
According to the Capital Markets Authority (CMA), foreign investors, who make up about 70 percent of daily trading at the NSE, turned into net sellers in the first half of the year as part of a global sell-off triggered by the coronavirus economic fallout.
The CMA report shows that the foreign investors' net sell-off in the six months to June was in contrast to the market performance in a similar half last year when overseas dealers were net buyers at Sh1.96 billion.
Foreign investors pulled out Sh9.1 billion in March when the coronavirus pandemic hit most countries outside China, and investors have also been selling stocks in other markets, including the United States, Japan, the United Kingdom, and Australia.
Stocks favoured by foreign investors and which make up the NSE-20 share index like Safaricom, Equity, EABL, and Bamburi Cement shed value in the half year ended June, cutting the value of shares at the Nairobi bourse by Sh174.5 billion.
"This drastic change can be attributed to the panic trading brought about by the Covid-19 pandemic," the CMA said in its latest report covering events to June.
