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Market Commentary
Key Features
Fund Manager | CIC Asset Management Ltd |
Launch Date | May - 18 |
Risk Profile | Low - Moderate |
Trustee | Kenya Commercial Bank |
Custodian | Co-op Custodial Services |
Auditors | Kirenge & Associates |
Fund Objective
The fund provides a solution to organizations that find setting up a Retirement Fund and continuously comply-ing with the complex legal and statutory demands a challenge in both monetary and human resource cost.
SMEs and start-up organizations.
Fund Outlook
Global risks continue negatively affecting our stock market, and coupled with the interest rate hikes in de-veloped economies, foreign exits have sustained. The low prices in the market continue to provide attrac-tive price points into stocks with strong fundamentals and perpetual dividend payout thus locking in good yields.The government continues relying on the domestic debt market to meets is deficit owing to expensive external debt financing. Rates on government securities are hence expected to continue increasing in the near term.The fund will continue being affected by the downturn in the stock market but the bond performance will support stable performance.The fund will continue being affected by the downturn in the stock market but the bond performance will support stable performance.
Asset Allocation
GDP
Kenya’s economy expanded by 4.0% in the third quarter of 2024, a decline from a 6.0% growth in the same quarter 2023. The slowdown was largely caused by contraction in critical sectors-Construction, Mining and Quarry-ing. However, the slower GDP growth observed in Q3 2024 was bolstered by strong performance in specific sectors (agriculture, accommodation services, and transportation) despite overall economic deceleration compared to previous years.
Inflation
Headline inflation edged up to 3.6% in March 2025 from 3.5% in Feb 2025, largely on account of increase in prices of food and non-alcoholic beverages. Food inflation increased to 6.6% from 6.1% in Feb 2025 predominantly owing to the rise of vegetables and maize flour prices. Core inflation, stood at 2.2 % in March 2025, a rise from 1.9% in Feb 2025 while non-core to 7.4% from 7.1% over the same period
Equities
n the month of March the bourse finished in the red on account of a plunge in the market capitalization which stood at KES 2,056Bn (-1.0m/m, 16.4% y/y). This was coupled by a waning market activity as depicted by the slump in Key indices, NASI, NSE-20 and NSE-25. The latter shed –1.0%, 3.19% and 1.74% respectively to close at 130.81, 2226.88 and 3532.38.
Exchange Rates
Interest Rates
In February, the Monetary Policy Committee voted to lower the policy rate to 10.75% from 11.25% having reviewed the out-comes of its previous decisions to anchor inflationary expectations and maintain exchange rate stability. The short-term papers continue to record a decline, with the 91-, 182- and 365-day papers closing at 8.79%, 9.06% and 10.41% respectively.
Fund Performance
Statutory Disclaimer: The value of units may go down as well as up and past performance is not necessarily a guide to the future. There are no guarantee on the client’s capital as the performance of units in the fund is determined by change in the value of underlying investments hence value of your unit trust investment
