By JAMES ANYANZWA

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East African stockmarkets continued to record mixed results during the three months to September, as investors shifted their money to alternative investments with relatively high and stable returns, such as government securities.

The poor performance of several listed firms reduced corporate earnings and the volatility of the stockmarkets have left investors rethinking their investment options.

Analysts at Cytonn Investments said stock prices at the Nairobi Securities Exchange have declined to record lows, offering opportunities for long-term investors to buy shares in listed firms.

“We are positive for investors with a long-term investment horizon. There are expectations that long-term investors will continue entering the market seeking to take advantage of the valuations, which are still historically low,” said Cytonn.

Activity on the Rwanda Stock Exchange slowed as the bond market recorded oversubscriptions. Analysts at the global advisory firm StratLink said investor interest shifted to government bonds issued on a quarterly basis.

During the period, Rwanda successfully issued a 15-year Treasury bond worth $17.2 million with a subscription level of 168.9 per cent from 72 applications and a yield of 12.9 per cent.

“The increased demand for bonds could be attributed to the lacklustre performance at the bourse,” analysts at the global advisory firm StratLink said.

According to the analysts, investors are seeking short-term investments whose returns remained largely stable with only marginal decline in yields on long-term bonds.

In Kenya, Standard Investment Bank (SIB) analysts said investors are also avoiding tying down their funds in long-term investments amid uncertainties in the interest rate regime. For instance, during the week ending September 21, Treasury bills were oversubscribed at 123.86 per cent compared with the previous week’s 181.14 per cent.

During the same period, the Nairobi All Share Index dropped by eight per cent, attributed to declines on large counters such as Co-operative Bank, Equity Group, Safaricom, Bamburi Cement and KCB Group.

The share prices of Co-operative Bank of Kenya, Equity Group, I&M Holdings and KCB declined by 14 per cent, 10.9 per cent, 10.9 per cent and 7.9 per cent respectively while foreign investors remained net sellers, with net weekly outflows increasing by 99.2 per cent to $ 8.1 million, from $ 4.1 million in the previous week.

In August, the NSE 20 Share Index lost 2.8 per cent of its value while the All Share Index lost 1.7 per cent with stocks such as Equity Group, Kenya Power, Britam, East African Breweries and KCB recording the steepest drops in their prices.

The Tanzania All Share Index shed 1 per cent month-on-month to close August at 2,270.3 units, down from 2,293.3 units in the previous month. On the other hand, the Tanzania Share Index shed 2.1 per cent to close the month at 4,140.9 units during the same period.

In Uganda, the chief executive of the Uganda Securities Exchange Paul Bwiso said the market has been dragged down by the poor performance of Umeme.