NAIROBI, KENYA | Xinhua | Bond trading at the Nairobi Securities Exchange (NSE) has hit a record high, boosted by foreign investors seeking to cash in as yields on the securities rise.
NSE data released Thursday evening showed that the bond turnover has been on an upward trajectory since Monday to hit a record 44 billion shillings (about 301.8 million U.S. dollars) Thursday, the largest single trading in the history of the bourse.
“The bond market has defied expectations, scaling new heights for a third consecutive day with bond turnover of 301.8 million dollars,” NSE said in a statement issued in Nairobi, the capital of Kenya.
On Wednesday, bond turnover reached 283.9 million dollars, compared to 248.9 million dollars on Tuesday, significantly higher than the average of 6.85 million dollars in previous months.
During the trading, investors went for government infrastructure bonds, in particular an 8.5-year security sold on Feb. 15 in the primary market. The bond is tax-free, has a shorter tenor of 8.5 years and the yields stand at 18.5 percent, incentives that made the paper appealing to investors during the primary sale.
The paper recorded increased demand from external investors, raising 1.55 billion dollars.
Foreign investors, who have shown renewed interest in Kenya’s bond market, are seeking to cash in on the bond’s higher yields as they go for it in the secondary market.
In 2023, investors’ wealth at the NSE declined 28 percent to stand at 9.8 billion dollars, making the bourse one of the worst-performing in Africa. The market has taken a positive turn in 2024, especially in the bond segment. ■
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