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Kenyan Shilling Weakens Modestly After Attack
A fuel attendant handles Kenyan shilling notes at a petrol station in the capital Nairobi March 15, 2011. PHOTO BY REUTERS/Noor Khamis.
23/09/2013
NAIROBI (Reuters) - The Kenyan shilling weakened slightly early on Monday as investors traded cautiously after a weekend attack by Islamist militants on a shopping mall in Nairobi, while shares in firms popular with foreign investors retreated.
The shilling was posted at 87.40/60 to the dollar at 0727 GMT, 0.2 percent weaker than Friday's close of 87.25/45.
Gunfire and explosions sounded on Monday from the Nairobi mall where militants from Somalia's al Qaeda-linked al Shabaab group have been holed up for three days.
"There will be some of that negative vibe feeding into it (the shilling), but with the way the liquidity is on the shilling's side, it won't help to have a long dollar position," said Duncan Kinuthia at Commercial Bank of Africa.
Trader said supply of the local currency had tightened in the market as companies paid the latest installment of corporate tax to the government last week.
"The Kenyan market has been largely held up by foreigners and they might panic," said Mwenda Rarama, an analyst at Kingdom Securities, commenting on the stock market. "A slide might be expected, but not something massive."
Safaricom, east Africa's biggest telecoms firm and frequently Kenya's most traded stock, had retreated 1.8 percent to 8.35 shillings a share by 0716 GMT.
The stock hit an all-time high of 8.70 shillings on Friday due strong offshore demand.
East African Breweries, another stock which foreigners like to hold, slipped 0.3 percent.
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