This archive report was first published on 5 August 2020.
Kenya's stock market has been severely impacted by the Covid-19 pandemic, with the Nairobi Securities Exchange (NSE) hitting a 17-year low in August 2020.
The NSE 20 Share Index closed at 1,794.6 points on August 4, 2020, a level last seen on April 28, 2003.
This significant decline has pushed the current bear market to five-and-a-half years, with the index falling 67.3 per cent from its peak of 5,491.3 points recorded on February 2, 2015.
The market sell-off was triggered by economic uncertainties caused by the pandemic, resulting in investors' paper losses of Sh576.4 billion since the start of the year.
Stock market data shows that large, blue-chip firms have been among the most affected, with Nation Media Group, Bamburi Cement, and Nairobi Securities Exchange (NSE) experiencing significant drops in their stock prices.
Since the year began, Nation Media Group's stock has dropped by 73.1 per cent, Bamburi Cement's by 67.1 per cent, and Nairobi Securities Exchange's by 44.9 per cent.
Even Safaricom, the largest company on the bourse, has shed 14.7 per cent over the same period.
The pandemic and measures taken to control its spread are expected to hurt economic growth in the short term, raising concerns about reduced corporate earnings and dividend cuts.
According to the International Monetary Fund (IMF), Kenya's real GDP growth is projected to be just one per cent this year.
Many NSE-listed firms have already warned investors that their earnings will fall by 25 per cent or more in their current financial year, citing depressed demand and restrictions on travel and social activities.
East African Breweries Limited (EABL) has already suspended dividends, reporting a 39 per cent drop in net earnings to Sh7 billion in the year ended June.
