The financial markets reacted nervously at the Supreme Court ruling on the presidential petition that gave NASA leader Raila Odinga a second chance at election, unnerving investors who lost billions in the process.
The Kenya shilling, for instance, fell by as much as 0.32 per cent within an hour after the highest court nullified the re-election of President Uhuru Kenyatta. Trading at the Nairobi Securities Exchange (NSE) was temporarily halted weight down panicky selling especially by foreign investors.
“In line with NSE trading rules, we halted trading from 12.30 to 1.00 p.m. as NSE 20 Share Index performance decreased by over 5 per cent,” the NSE said in a statement. Trading rules require shutting of the market is trading falls by at least 5%.
And in less than 10 minutes, more than Ksh50 billion was lost at the Nairobi Securities Exchange, wiping out earnings form thousands of investors and eroding value from most of the stocks traded.
The Supreme Court, in a majority decision, ordered a fresh presidential election in 60 days as per the country’s Constitution, citing “irregularities and illegalities” in the electoral process, which started with polls on August 8.
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The shilling, which had opened trade at an average of 102.81 units against the dollar, according to the Central Bank of Kenya’s data, depreciated and was exchanging at 103.14 at around 12.52 pm.
The markets had cheered Uhuru’s re-election even rising on the day the presidential results were announced. For markets, Uhuru represents continuity while Raila portends radical change that is likely to shake markets and ruffle the status quo.
