OREANDA-NEWS. Kenya's shilling firmed on Thursday helped by slow importer dollar demand and on expectations of foreign investors buying a government bond on sale this month.

Stocks fell for a third consecutive day.

The shilling closed at 91.05/15 to the dollar, compared with Wednesday's close of 91.15/25 to the dollar.

Traders the shilling will also gain from hard currency inflows foreign investors preparing to buy an infrastructure bond on sale this month.

"Demand has somewhat eased after most of the corporates bought at about 91.40/50 levels," a senior trader at one commercial bank said.

"There is a lot of interest in this paper, and the market is expecting foreign participation to be around more than 60 percent."

Traders said the shilling was also partly benefiting from foreign investors fleeing Nigeria's faltering economy. A sharp drop in global oil prices and uncertainty following a six-week delay in its presidential elections has weakened markets.

"With what's happening in Nigeria, everyone is getting scared. So they are really coming in massive chunks to invest in Kenya," said Sheikh Mehran, head of trading at I&M Bank. "There is a major reallocation of assets."

The shilling has in the past week also received support from regular liquidity mop ups by the central bank. On Thursday, the central bank mopped up 6 billion shillings from the money markets. Absorbing makes it costlier to hold dollars.

On the Nairobi Securities Exchange, the main NSE-20 Share Index was down 50.03 points, or 0.9 percent, to close at 5,411.05 points.

Traders said the drop was due a correction as investors sold to cash in their gains made in the past two weeks.

On the secondary market, government bonds worth 2.45 billion shillings (\$26.91 million) were traded, compared with Wednesday's 4.57 billion shillings.