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Nairobi Securities Exchange (NSE) has defied political tensions in the country, with investors pricing their general sentiments on the premise the presidential election will be upheld and validated.

Analysts have also attributed the rally to solid half-year performance especially from tier 1 banks, although they reckon this might be temporarily dampened by global macro-economic headwinds as a result of policy tightening by the developed world except for China.

Yesterday, a total of 22,950,800 shares were traded in 1,113 deals, corresponding to a market value of Sh732.4 million were traded, representing a 57 per cent improvement in volume, 79 per cent improvement in turnover and 5 per cent improvement in deals from Wednesday’s data, with current market capitalization at Sh 2.14 trillion.

Kevin Ngige, a market analyst at Genghis Capital said he expects a temporary rally (dead cat bounce) with the markets responding to the new administration, on the backdrop of the continuing to facing challenges attracting foreign direct investment and the slow paced supply shocks recovery.

“I anticipate, best case scenario, presidential election being validated, a temporary rally otherwise known as a dead cat bounce, on the backdrop of sustained investor optimism that comes with every new regime, albeit this facing serious global macroeconomic headwinds, thanks to tightening by the developed worlds with the exception of China,” said Ngige, an analyst at Genghis Capital.

The Supreme Court has four days to conclude the ongoing presidential petition and render judgement.

In addition to hearing the petition, Kenya’s apex court has ordered retallying of presidential ballot papers from15 contested polling stations at Forodha House, Nairobi.

All leading tier1 banks including KCB Group, Equity Group Holding, Standard Chartered Bank and Absa reported net profits of Sh19.6 billion, Sh24.4 billion and Sh5.4 billion and Sh6.3 billion respectively.

Political divide

Since last month, the markets have been reacting positively to the calmness in the political divide, especially after a relatively peaceful polling exercise, with traded volumes gaining, driven by penny stocks including Kenya Power and KenGen among others.

In an earlier conversation, Wesley Manambo, also a market analyst to the Business Hub that Blue chips stocks like Safaricom, East Africa Breweries Limited (EABL), Equity Group Holdings and KCB Group would the turnover print until, partly because of foreign play to the unfolding general elections.

“Blue chips, including Safaricom, Equity, EABL and KCB will determine the mood of the market until after elections are done,” he said.