WEEKLY FIXED INCOME REPORT - WEEK 3
Weekly Wrap:
Secondary market turnover declined 46.02% w/w in the week to record KES 5.24Bn. The trades were spread out across the yield curve with the top five traded bonds accounting for 63.23% of total activity. This month’s issue – IFB1/2018/15Yr (15-year tenor infrastructure bond) – was announced in the course of the week. We hold the view the primary bond issue also led to the subdued secondary market turnover.
USDKES:
The shilling’s performance improved marginally in the week crossing the psychological 103 level to close at 102.90. The performance largely hinged on a weaker dollar, with the dollar index falling 10.0% in the course of 2017.
Money Market:
The average interbank rate edged up 138bps to 6.54% in the week. Interbank volumes increased by KES 7.28Bn to settle at KES 75.36Bn.
This Week’s Outlook: IFB1/2018/15Yr
This month’s primary bond issue is a fifteen-year maturity infrastructure bond; IFB1/2018/15 offering 12.50% coupon. The period of sale runs till Tuesday 23rd January, 2018. The purpose of the primary issue is geared towards funding of infrastructural projects in the current FY2017/18 budget estimates. In the initial budget estimate, KES 265.43Bn (3.20% of estimated FY17/18) was allocated towards completion of on-going infrastructural projects. Our view is that the average yield will average between 12.89% – 13.09%.
Genghis Capital is an innovative and customer focused Investment Bank licensed by the Capital Markets Authority (CMA). Founded in 2008, Genghis is one of the leading investment banks in Kenya. Since its establishment, Genghis has achieved tremendous growth to offer a well-diversified portfolio of financial services that includes:
- i. Securities(Equity/Debt) Trading
- ii. Research
- iii. Wealth Management services
- iv. Investment Advisory & Management via the GenCap Unit Trusts
- v. Corporate Finance & Transaction Advisory services
The Kenyan Capital Markets continue to develop in size, scope and sophistication. With this is an increasing demand for more specialized and personalized brokerage service and we at Genghis Capital are glad to be able to offer you this service. Our strength lies in ensuring our clients are up to speed with developments at the stock market and the economy. Research and technology remains our competitive and comparative advantage hence Experience, Expertise and Professionalism are some of the qualities you can expect from our team.
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