Kenol shares suspended from trade

The Capital Markets Authority has raised suspicion over the distortion of Kenya Oil shares at the Nairobi Stock Exchange on Monday.

Initial investigations by the authority have also indicated that the sale was unusual.

As a result, a suspension on trading in Kenol shares issued for Wednesday will be lifted on Thursday to allow for the share price correction.

The share price dropped 33 per cent to Sh30 during the opening of the week trading from Sh45 shillings it posted on Friday after the release of the firm’s financial results.

“The Capital Markets Authority has directed the Nairobi Stock Exchange to suspend the trading of Kenol shares for April 8 and lift the 10 per cent trading price limits for the trading session of April 9,” CMA said in a statement on Wednesday.

According to market statistics on Tuesday, no trading for the shares took place in what some traders said was due to lack of interest.

The statement to newsrooms signed by chief executive Stella Kilonzo said preliminary findings pointed fingers at an investment bank.

“During trading on Monday, a transaction of 1.4 million Kenol Limited shares was executed across the books of an investment bank at Sh30 on the prompt board even when there were offers of between Sh41 and Sh52 on the normal board,” it read in part.

Trading limits

CMA rules allow for a 10 per cent daily trading limits for stocks but this is lifted whenever a company announces its financial results.

This is not the first time the market is facing issues of price distortion for shares listed at the exchange.

Last year, Crown Berger and East African Portland Cement had similar issues.