Kenyan stocks, the worst performers in sub-Saharan Africa last year, are this year’s third-best worldwide as the central bank reins in inflation and spurs a rally in the currency.
The Nairobi Stock Exchange All-Share Index (NSEASI) has surged 24 percent this year, the most after Venezuelan and Egyptian equities and paring 34 percent losses in 2011, according to data compiled by Bloomberg. While valuations have climbed from an all-time low of 5.6 times earnings in March, the ratio of 6.4 is 42 percent below the average for the index since 2008.
Shares are rebounding after record-high interest rates cut inflation to 12.2 percent in May from 19.7 percent in November and sent the shilling to the biggest rally globally since October. Kenya’s $12.3 billion stock market will probably extend gains as economic growth accelerates, said Standard Bank Group Ltd., Africa’s largest lender.
Read On: http://www.businessweek.com/news/2012-06-27/kenya-stocks-lure-templeton-to-world-s-third-biggest-rally
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