The Nairobi Securities Exchange (NSE) has introduced the NSE 10 index, designed to monitor equities market performance alongside existing indices. This addition complements the NSE 25, a market capitalization-weighted index. The NSE 10 index encompasses prominent companies like Safaricom, Equity Group, KCB Group, Co-operative Bank of Kenya, Absa Bank Kenya, East African Breweries, NCBA Group, Kenya Electricity Generating Company (KenGen), Kenya Re, and Centum Investment. These ten firms collectively account for 75.5% of the Kshs 1.5 trillion NSE market capitalization.
Utilizing a market capitalization float-adjusted methodology, the NSE 10 index’s constituent companies will undergo semi-annual reviews. Commencing at 1,000 points, the index experienced a less-than-ideal start, dropping 8.4 points to close at 991.6 points on Monday.
Read more: Safaricom’s Influence Declines as Foreign Investors Reshape NSE Trends
Alongside the NSE 10, the NSE has also introduced the NSE Bond Index (NSE-BI) to track the bonds market. Geoffrey Odundo, NSE’s CEO, emphasized how these developments would empower investors to effectively monitor listed securities on the NSE. Daily end-of-day reports will now feature the NSE 10 index in addition to the NSE 20 and NSE 25, while the NSE-BI will be a weekly index, together with the existing NSE Yield Curve.
Furthermore, the NSE revamped its list of NSE 20 companies, with WPP Scan Group, Nairobi Securities Exchange PLC, and Diamond Trust Bank Kenya being removed. New entrants are CIC Insurance Group, Bank of Kigali Group, and I&M Holdings. The NSE 20 Share index, a price-weighted index averaging the top 20 performing counters, selects entrants based on weighted market performance, including trading activity measures and a requirement of at least 20% of shares quoted at the NSE.
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