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UPDATE 1-Kenyan shilling falls on importers' orders, shares rise

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* Sentiments on shilling remain bearish in coming days

* Shares rise on foreign buys into large cap stocks

(Adds markets close, stocks)

By Kevin Mwanza

NAIROBI, Oct 11 (Reuters) - The Kenyan shilling

weakened on Thursday, weighed down by importers in the telecomsand energy sectors buying the dollar, while the share index waslifted gai ns in major sto cks.

The shilling was trading at 85.10/30 to the dollar at the1300 GMT market close, a touch weaker than Wednesday's close of85.05/25.

"Sentiment still points to a weaker shilling. We've seendollar demand from telecoms and energy guys while inflows arestill low," said Solomon Alubala, head of trading atCo-operative Bank.

Technical analysis charts showed support for the shilling at85.50 and traders said that if it fell below that level it couldweaken to 86.00.

The shilling is up 0.1 percent against the dollar this year.

It had gained as much as 2 percent in the first half of theyear due to a credit squeeze after the central bank heldinterest rates at an ultra high 18 percent for seven months. Butit started falling in July after policymakers embarked on amonetary easing cycle as inflation fell into single digits.

The central bank mopped up 1.65 billion shillings ($19.4million) in excess liquidity in the market on Thursday, morethan the 1.5 billion shillings it had intended to sell.

At the Nairobi Securities Exchange, the main share index

rose 0.4 percent to 3,997 points led up by the topthree market heavyweights East Africa Breweries

,Safaricomand Equity Bank.

The three stocks accounted for 63 percent of the days tradedvolumes.

"Foreign investors are targeting these counters because theyare easy to trade in due to their share liquidity," said JohnsonNderi, an analyst at Suntra Investment Bank.

"Their cost of funding has come down, same as inflation andwith a stable currency, Kenyan stocks have attractive positivereturns."

East Africa Breweries gained 2.2 percent to 235 shillings,while Safaricom added 1.2 percent to close at 4.10 shillings.

Equity Bank, Kenya's biggest bank in terms of the number ofaccount holders, rose 1.1 percent to 23.25 shillings.

In the debt market, the weighted average yield on thebenchmark 91-day Treasury bills

rose at auction to8.962 percent from 10.194 percent last week.

Government bonds worth 1.9 billion shillings ($22.3 million)were traded, up from 1.8 billion shillings on Wednesday.

...........................Shilling spot rates

.....................Shilling forward rates

.......................Cross rates

..................................Local contributors

.......................Central Bank of Kenya Index

.....................Kenyan Bonds contributor pages

...............Treasury bill yields

..................Central bank open market operations

.........................Horizontal repo transactions

,

................Daily interbank lending rate

.............................Kenya Bond pricing

..................Real time Africa economic data

...........................African economic news

.................................NSE-20 Share Index

.................................NSE All Share Index

...........................FT NSE Kenya 15 Index

.......................... FT NSE Kenya 25 Index

SPEED GUIDES:

($1 = 85.1000 Kenyan shillings)

(Editing by James Macharia and Anthony Barker)

((nairobi.newsroom@reuters.com)(Tel: +254 20 2224717))

Keywords: KENYA MARKETS/

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