NSE Slides Over 2%: NASI Falls 2.57% in Week as Foreign Money Chases Higher US YieldsNSE Slides Over 2%: NASI Falls 2.57% in Week as Foreign Money Chases Higher US Yields

The slide matters for every small investor holding shares through a CDSC account, because it came as buyers were also weighing fresh offers such as the Dangote refinery share offer open to Kenyans.

According to the Central Bank of Kenya Weekly Bulletin of 16 October 2026, the NSE All Share Index (NASI) fell 2.57%, the NSE 25 fell 2.52% and the NSE 20 fell 1.97%.

Market value and trading volumes diverge

Market capitalisation also dropped 2.57%, matching the fall in NASI. Total shares traded fell 25.91% over the week, which means fewer shares changed hands, yet equity turnover rose 33.42%. In plain terms, investors traded fewer shares but moved more money, a pattern that usually points to activity concentrated in higher-priced counters rather than broad buying across the board.

The fall is sharper than the one Mwenendo reported a week earlier, when foreign investors net sold KSh 737M ($5.68M) of Kenyan shares. The latest bulletin does not give foreign inflow or outflow figures, so it is not possible to say how much of the fresh decline came from non-residents.

Analyst points to rebalancing and higher US yields

Dedan Maina, a CFA charterholder and capital markets analyst at Ketu Capital, attributes the weakness to three factors: institutional portfolio rebalancing, competition from US Treasury yields, and positioning ahead of third-quarter company earnings. A recent US Federal Reserve rate increase has made Treasury securities more attractive relative to frontier-market equities, the analyst said.

"Institutions are adjusting their exposure to market risk rather than necessarily abandoning equities altogether," Maina said. He added that foreign institutional support may stay subdued until local valuations become more compelling.

What the fall means for ordinary investors

For retail investors, Maina recommends holding roughly 10% to 30% of a portfolio in liquid reserves and avoiding aggressive buying during the correction. That advice is the analyst's view, not an official recommendation by the exchange or the regulator.

As Mwenendo earlier reported, Dangote Cement's planned London share sale is another draw on global investor attention, and the Kenyan market will be watching third-quarter earnings from listed banks, telecoms and manufacturers for a reason to buy back in. The bulletin does not list index levels, the biggest gainers or losers, or individual share prices for the week.