The Nairobi Securities Exchange shed KSh 96.02Bn in market capitalization on Monday - March 23rd, its 7th largest single-day loss since 2008 and the worst daily decline since February 24, 2022.
- •Losers outnumbered gainers 40 to 11, with 17 counters unchanged, as every major index fell and trading volumes surged across the board.
- •Safaricom absorbed more than half the damage, falling 4.46% to KSh 28.90 and losing approximately KSh 54.0Bn in market value from a pre-session capitalization of about KSh 1,211.9Bn. The telco moved 5.34 million shares worth KSh 154.3M.
- •The most visible external catalyst is the Iran war and the effective closure of The Strait of Hormuz, now in its fourth week, which has pushed Brent crude past $100 per barrel and rattled emerging markets globally.
Banks drove the rest of the decline, accounting for 61.7% of equity turnover at KSh 493.3M, with KCB falling 4.61% to KSh 72.50, Equity dropping 4.25% to KSh 73.25, and ABSA losing 2.83% to KSh 30.90.
The selloff set several index records. The NSE 10 fell 3.15%, its second worst session since launching in September 2023, while the NSE 25 dropped 2.68%, the steepest since April 2025. The Banking Index fell 2.41%, matching its worst day since launching in October 2025, and the NASI declined 2.76%
India's Sensex fell over 1,500 points on the same day. For Kenya, sustained high oil prices threaten the fuel import bill, the inflation outlook, and the shilling, potentially stalling the Central Bank of Kenya's rate-cutting cycle, one of the key pillars underpinning the 2026 equity rally.
But the market's vulnerability to this shock was locally constructed. Investor wealth began 2026 at approximately KSh 2.94Tn and surged past KSh 3.5Tn by mid-March, a KSh 560Bn expansion built almost entirely on domestic capital at valuations as low as 6.3x earnings. Foreign investors were net sellers throughout the rally, recording outflows of KSh 595M during the record-setting week ending February 13, KSh 2.60Bn in Week 11, and KSh 354.9M in the shortened Ramadan week, meaning the advance had no offshore support base to cushion a reversal.
The launch of Safaricom's Ziidi Trader on February 10, which brought stock trading directly to M-Pesa's 35 million users, deepened the structural dynamic. Ziidi captured 55% of all NSE orders on its first day of trading, flooding the market with small-ticket retail buying that broadened demand but also gave institutional and long-term holders, many sitting on positions accumulated at far lower prices, the liquidity to distribute into strength.
Monday's drop pulls market capitalization to KSh 3.38Tn, erasing roughly KSh 123Bn from the recent peak. Foreign investors recorded heavy disposals in Equity (KSh 89.8M), Safaricom (KSh 82.9M), and KCB (KSh 70.0M).
The market retains strong year-to-date gains, with the NASI up 9.14%, the NSE 20 up 14.84%, and the Banking Index leading at 15.63%.
