Kenya's capital markets came under pressure in September, with the Nairobi Securities Exchange (NSE) shedding nearly Sh96.3 billion in market capitalization, as the equities market tracked a broader decline in share prices.
The NSE’s market capitalisation fell by 2.28 per cent to Sh4.12 trillion at the end of September, from Sh4.22 trillion in August and higher values earlier, according to the NSE’s September 2026 Monthly Barometer.
The decline included a sharp mid-September dip where the market briefly fell below the Sh4 trillion mark (losing over Sh336 billion across late August into mid-September before stabilising).
NSE crossed the Sh4 trillion market capitalisation milestone for the first time on August 3, 2026, when it closed at Sh4.013 trillion.
During the September month under review, the All-Share Index (NASI), the broadest measure of the performance of listed equities, also declined by 2.28 per cent, pointing to a weaker overall market despite gains recorded by selected counters and sectors.
The NSE 20 Share Index fell marginally by 0.20 per cent, while the NSE 25 Share Index bucked the trend to rise 0.25 per cent.
The exchange said the performance came against a mixed global and domestic economic backdrop, with Kenya’s annual inflation rising to 6.8 per cent in September from 6.6 per cent in August.
“The market capitalisation decreased by 2.28 per cent to Sh4,121.65 billion,” the NSE said in its monthly barometer.
During the month under review, trading activity remained concentrated in a handful of large companies, with Safaricom retaining its position as the most actively traded stock.
Safaricom accounted for 24.23 per cent of total equity turnover during the month, generating Sh7.01 billion in traded value. Absa Bank followed with Sh5.19 billion, equivalent to 17.96 per cent of turnover.
Equity Group was third with Sh4.26 billion, representing 14.74 per cent, while KCB Group generated Sh4.13 billion, accounting for 14.27 per cent.
The four counters therefore dominated trading activity, reflecting the continued importance of large-cap banking and telecommunications stocks to liquidity at the NSE.
The top 10 companies accounted for 87.70 per cent of total equity turnover in September, up slightly from 87.59 per cent in August.
Despite the overall market decline, some counters posted sharp gains.
Africa Mega Agricorp (formerly Kenya Orchards Limited) emerged as the biggest gainer, rising 107.16 per cent month-on-month, according to the NSE.
At the opposite end of the performance table, Shri Krishana Overseas Limited, a Kenya-based company specialising in the manufacture of packaging materials and footwear, recorded the steepest decline, falling 20.23 per cent during the month.
At sector level, banking was the strongest performer, recording a reported gain of 83.75 per cent, while the exchange-traded funds (ETFs) segment was the weakest, declining 8.84 per cent.
The derivatives market also recorded a substantial increase in monthly activity. Deals rose 75.18 per cent from 137 in August to 240 in September, while traded volume increased 234.25 per cent to 48,854. Turnover surged 223.49 per cent to Sh235.5 million.
The fixed-income market, however, moved in the opposite direction. Bond turnover declined 14.08 per cent month-on-month, falling from Sh342 billion in August to Sh293 billion in September.
September also brought a significant development on the listing front, although the monthly barometer does not record a new equity listing on the NSE during the month.
On September 29, the exchange hosted Dangote Group President Aliko Dangote and East African institutional investors to discuss access to the Dangote Petroleum Refinery IPO.
The discussions included a Global Depositary Receipt programme on the NSE, which has now opened the door for Kenyan investors to participate in the Nigerian IPO in Kenya shillings.
Capital Markets Authority has approved the participation of eligible Kenyan investors in the Initial Public Offering (IPO) of Dangote Petroleum Refinery & Petrochemicals through the Global Depository Receipts.
The IPO opened on September 14 and is scheduled to close on October 13, 2026.
In a statement on Monday, CMA said it had approved a Short Form Prospectus for the GDRs submitted by Renaissance Capital (Kenya) Limited, a licensed investment bank.
Renaissance Capital (Kenya) will put in place custodial arrangements for funds received from investors and is working with Renaissance Capital Africa, which is licensed in Nigeria.
Once the IPO closes and the allocation of Dangote Petroleum Refinery & Petrochemicals shares is confirmed, Renaissance Capital (Kenya) will structure the GDRs for listing on the Nairobi Securities Exchange (NSE).
The September performance therefore leaves the NSE facing a mixed picture where overall valuations weakened, but liquidity remained concentrated in blue-chip counters.
Derivatives activity accelerated sharply and potential cross-border listings offered a new avenue for expanding investment opportunities.
