The equities market was on a downward trajectory in one week to August 25, with NASI, NSE 20, and NSE 25 declining by 1.9%, 0.7%, and 2.1%, respectively, taking the YTD performance to losses of 22.0%, 9.1%, and 18.3% for NASI, NSE 20, and NSE 25, respectively.
The equities market performance was mainly driven by losses recorded by large-cap stocks such as KCB Group, ABSA Bank and Safaricom of 13.5%, 6.7 and 3.1%, respectively.
The losses were, however, mitigated by gains recorded by stocks such as EABL, Standard Chartered and Bamburi of 7.2%, 6.0% and 3.4% respectively.
During the week, equities turnover decreased by 72.9% to Ksh.464.4 million (USD.3.2 million) from Ksh.1.6 billion (USD 11.7 million) recorded the previous week, taking the YTD total turnover to Ksh.77.3 billion (USD.533.2 million).
Foreign investors remained net buyers for the fourth consecutive week with a net buying position of USD 0.1 million, from a net buying position of USD 0.7 million recorded the previous week, taking the YTD foreign net selling position to USD 271.6 million.
The market is currently trading at a price to earnings ratio (P/E) of 5.0x, 59.3% below the historical average of 12.3x.
The dividend yield stands at 8.7%, 4.4% points above the historical average of 4.3%. Key to note, NASI’s PEG ratio currently stands at 0.6x, an indication that the market is undervalued relative to its future growth.
A PEG ratio greater than 1.0x indicates the market is overvalued while a PEG ratio less than 1.0x indicates that the market is undervalued.