New York-based Morgan Stanley Capital International (MSCI) has expanded its frontier markets indices by adding two more Kenyan-listed firms, enhancing the Nairobi Securities Exchange (NSE) profile among foreign investors, Business Daily reported on February 16.

Standard Chartered Bank Kenya has been included in the frontier markets index, while housing financier HF Group joins the frontier markets small-cap index. The changes will take effect after the close of business on February 28.

This development comes as the NSE seeks to sustain its recovery after five consecutive years of decline. The inclusion of additional Kenyan stocks increases their visibility to global institutional investors, potentially boosting foreign capital inflows at a time when offshore investors have largely been net sellers.

MSCI is a leading provider of market indices and investment decision tools, tracking global equities, bonds, and real estate markets. Its classifications—developing, emerging, frontier, and standalone—help institutional investors, including pension funds, determine market allocations.

Kenya’s stock market rebounded in 2024, supported by increased investor appetite for banking stocks, relative currency stability, and the government’s repayment of a $2bn Eurobond, which averted a default risk. NSE chief executive Frank Mwiti in said the repayment was a “key milestone” that played a “pivotal role in boosting investor confidence.”

NSE data shows market turnover rose 20% to KES 105.23bn ($812.59mn) in 2024, the first annual increase since 2018. Additionally, the NSE Bond Market achieved a historic milestone by surpassing KES 1 trillion ($7.75bn) in cumulative turnover between January 2 and August 21, 2024. This was driven by strategic bond market reforms, including the implementation of the hybrid fixed-income market, The EastAfrican reported on February 15.