Sharp Daily
No Result
View All Result
Saturday, July 19, 2025
  • Home
  • News
    • Politics
  • Business
    • Banking
  • Investments
  • Technology
  • Startups
  • Real Estate
  • Features
  • Appointments
  • About Us
    • Meet The Team
Sharp Daily
  • Home
  • News
    • Politics
  • Business
    • Banking
  • Investments
  • Technology
  • Startups
  • Real Estate
  • Features
  • Appointments
  • About Us
    • Meet The Team
No Result
View All Result
Sharp Daily
No Result
View All Result
Home Investments

Optimism grows as Kenya’s economy recovers and stocks rally

Patricia Mutua by Patricia Mutua
January 3, 2025
in Investments
Reading Time: 2 mins read
Economic recession and recovery concept and return on investment roi idea

Economic recession and recovery concept and return on investment roi idea

Kenya’s economy is showing promising signs of recovery, with significant improvements in key areas such as household incomes, stability in the shilling, and progress in reducing fuel and essential commodity prices.

The improved economic situation has been accompanied by a notable decline in yields on government papers. The Central Bank of Kenya’s (CBK) accommodative monetary policy has played a crucial role in this decline, making equities more attractive compared to government securities. The 91-day Treasury bill rate has fallen below 10% for the first time since April 2023, reflecting the CBK’s efforts to support economic stability.

This decline in yields has shifted investor focus towards equities, with the Nairobi Securities Exchange (NSE) showing improved performance, with NSE 10, NSE 25, NASI and NSE 20 gaining by 42.9%, 42.5%, 34.3% and 33.3% respectively in 2024.

Additionally, the cheaper valuations for most stocks compared to historical levels have further bolstered investor confidence. The market is currently trading at a Price-to-Earnings (PE) ratio of 5.4x, which is lower than its 3-year average PE of 6.3x. This indicates that stocks are relatively undervalued, making them an attractive investment option.

RELATEDPOSTS

AFD hands Ghana lifeline, extends USD 102.59 million grant

November 6, 2023

The improved economic parameters like inflation, exchange rate and interest rates are expected to continue positively impacting company earnings, leading to gains in stock prices. As companies report better financial performance, investor confidence grows, driving up stock prices. This trend is evident in the performance of key companies listed on the NSE, which have seen significant gains in their stock values in the past quarter.

The economic outlook for 2025 is optimistic, with projections of a 5.6% GDP growth driven by services and household consumption. Inflation is currently at 3%, down from higher levels in previous years, which helps maintain purchasing power and supports consumer spending. These factors create a conducive environment for market growth and attract both local and international investors.

As Kenya continues to navigate its economic recovery, the decline in government paper yields, the shift towards equities, and the attractive valuations of stocks are positive indicators of growing investor confidence and a more stable financial market.

Previous Post

Balancing green spaces in the built environment

Next Post

The growing risk of climate change on health and insurance in Kenya

Patricia Mutua

Patricia Mutua

Related Posts

Investments

Invest in stability: introducing the Cytonn USD money market fund

July 18, 2025
Analysis

Park your money where it grows: Why more Kenyans are turning to Cytonn Money Market Fund

July 16, 2025
Analysis

Nvidia becomes the first company globally to hit USD 4.0 trillion market value

July 10, 2025
Analysis

Lessons from the Kuramo-TransCentury fallout

July 3, 2025
Analysis

Kenya’s CIS market: Q1′ 2025 shows a surge, setting the stage for future expansion.

June 26, 2025
Investments

Investor shift to long term bonds drives oversubscription in CBK’s reopened auction

June 19, 2025

LATEST STORIES

Invest in stability: introducing the Cytonn USD money market fund

July 18, 2025

The Importance of Asset Diversification on Kenyan Pension Funds

July 18, 2025

Park your money where it grows: Why more Kenyans are turning to Cytonn Money Market Fund

July 16, 2025

Strategies to boost alcohol and tobacco tax revenues

July 16, 2025

Kenya’s reactive monetary policy

July 16, 2025

Why Employers Should Prioritize Pensions Over One-Time Gratuity Payments

July 10, 2025
Business and Finance Concept - Coin, Currency, Financial Item, Graph,

Opinion: Why lower taxes may be Kenya’s only escape route

July 10, 2025

Nvidia becomes the first company globally to hit USD 4.0 trillion market value

July 10, 2025
  • About Us
  • Meet The Team
  • Careers
  • Privacy Policy
  • Terms and Conditions
Email us: editor@thesharpdaily.com

Sharp Daily © 2024

No Result
View All Result
  • Home
  • News
    • Politics
  • Business
    • Banking
  • Investments
  • Technology
  • Startups
  • Real Estate
  • Features
  • Appointments
  • About Us
    • Meet The Team

Sharp Daily © 2024