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Macro Thoughts

I think the Euro looks very rich at 1.30. And I like selling it there.
The Cocoa Story is very interesting. I think the Breakfast Commodities
[Coffee, Cocoa, Sugar, Tea Orange Juice] look appealing.

Home Thoughts

The Older Girls have had Braces put in and both came up to me and said
Well How do they look? And I was about to say that My Remembrances of
Braces was of that very Tall Villainous Fellow in James Bond and the
most frightening thing I found about him was not his Size but the fact
that he wore Braces. He did didn't he? But I did not because James
Bond is a very long time ago. And it made me think of Fads and Trends
amongst Teenagers and actually Gladwell has done some excellent work
on that very Subject. In 2008, when everything was on a Knife Edge, I
remember them asking me
'So where are we being evacuated to?'
'Dubai?'
Then clearly everyone's Parents were discussing Evacuation.
You learn a lot from your Kids.

Sayyid Qutb and the Origins of Radical Islamism. By John Calvert.
Hurst & Co; 256 pages; £25. To be published in America by Columbia
University Press in August. Buy from Amazon.co.uk

PRE-EMINENTLY among the pioneers of 20th-century Islamism, Sayyid Qutb
has come to be seen as the evil genius who inspired today’s global
jihad. As John Calvert argues in a persuasive new biography, Qutb’s
reputation is not entirely undeserved, but it does less than justice
to a complex and enigmatic figure.

Imprisonment and torture turned him into an impassioned and
embittered revolutionary. His book “Milestones”, written in prison to
chart a future course for his crushed and demoralised movement, became
an internationally influential manifesto of the Islamic revolution—not
least because in 1966, two years after it was published, Qutb was
hanged for treason, becoming a martyr for the cause.Part of the
originality of “Milestones” was Qutb’s use of the term jahiliyya to
depict the abject condition of the Muslim world. Literally meaning
ignorance, the term was originally used to describe the benighted
condition of Arabia prior to the advent of Islam. But Qutb used it to
condemn Muslim governments and societies which, in his eyes, had been
corrupted by Western culture and secularism to the point where they
had abandoned Islam.

Conclusions

The Lenin or is it Trotsky of the Islamic Fundamentalists?

By Aly-Khan Satchu July 19, 2010
Nairobi, Kenya

Revolutions typically happen dramatically. One day, the shah of Iran
is sitting pretty on his peacock throne, and the next, he is gone.

Revolutions have been happening all over the African continent and at
fairly regular intervals. The stories are numerous of coups and
countercoups, and it's not for no good reason that Africa has
typically sat at the bottom of the political stability indices. Even
here, though, there comes a point at which you cannot go any lower.
It's called "oversold." The political stability index for Africa has
bottomed out, in fact.

During the tumult, vast African populations were just bystanders. The
State and its paraphernalia – or rebel militias – might descend on
your district every few years but, otherwise, things went on as they
had. There was a single TV station to tell you what happened, and the
world went by.

Cameron, describing Obama as one of the "calmest, coolest people I
have come across", also held a working lunch with the US president,
accompanied by five officials on either side, which was largely
focused on Afghanistan. He also defended his austerity plan, in
contrast to Obama's slower shift to deficit cutting. Cameron said: "We
are different countries, we have different needs, and we are going to
do things at different speeds. America is still a reserve currency.
You guys can run a bigger deficit for longer than we can. This year we
are borrowing more than virtually any other country in the G20."

Conclusions

Made His Point on Austerity versus Stimulus.

Euro 1.2880
Pound 1.5282 - I like the Pound especially on Pull Backs and Crosses
Canada 1.0411 stronger on the Rate Hike
Dollar Index 82.73
Aussie 0.8818
Rand 7.5635
India Rupee 47.27

The euro retreated from a 10-week high against the dollar as investors
turned cautious ahead of the results of European bank stress tests due
this week.The euro had advanced to $1.30 from the four-year low just
under $1.19 hit in early June, and analysts said the common currency's
recent rally may have outpaced the support the euro is likely to glean
from the tests.

Conclusions

1.30 looks overcooked to me.

Euro Dollar 3 Month Chart INO
http://j.mp/bxIoJI

Governor Mark Carney raised the target rate for overnight loans
between commercial banks a quarter point to 0.75 percent, a decision
expected by all 20 economists surveyed by Bloomberg News. The growth
forecast was cut to 3.5 percent from 3.7 percent for this year and to
2.9 percent from 3.1 percent for 2011, according to a statement today
from the Ottawa-based bank.

Canada’s housing market, which helped lead the country out of
recession last year, has cooled. Housing starts fell for a second
month in June, and building permits fell 10.8 percent in May.

“Housing activity is declining markedly from high levels, consistent
with the Bank’s view that policy stimulus resulted in household
expenditures being brought forward into late 2009 and early 2010,” the
statement said.

Revenue in the three months that end in September will be about $18
billion, Apple said yesterday. Analysts had predicted sales of $17
billion. The company also reported third-quarter revenue and profit
that exceeded analysts’ predictions, fueling a gain in Apple stock  in
extended trading.

“It never ceases to amaze me how Apple can beat unreasonably high
expectations,” said Michael Yoshikami, chief investment strategist at
YCMNet Advisors, which owns Apple shares. “They have positioned
themselves well for this next inflection point in technology, which is
to handheld devices.”

Net income leaped 78 percent and revenue reached a record last
quarter, the first to include sales of the iPad tablet computer and
the newest iPhone. Chief Executive Officer Steve Jobs, 55, vowed to
release more “amazing new products” this year, part of an effort to
repel a threat from Google, a competitor in mobile software and
advertising, and such computer makers as Hewlett-Packard Co., which
plans its own tablet.Apple, based in Cupertino, California, rose as
much as 4.4 percent after the results were reported. It had gained
$6.31 to $251.89 in Nasdaq Stock Market trading yesterday, capping
this year’s 20 percent increase.

Customers bought 3.27 million iPads last quarter, indicating Jobs made
headway creating a market for entertainment-friendly devices that are
larger than a smartphone yet less powerful than laptops. Introduced
April 3, the iPad outsold the almost decade-old iPod music player,
revenue-wise.

Net income rose to $3.25 billion, or $3.51 a share, from $1.83
billion, or $2.01, a year earlier. Analysts surveyed by Bloomberg had
forecast per-share profit of $3.11.The iPhone, which generated $5.33
billion on 8.4 million units, was Apple’s top-selling product for a
second-straight period. The quarter’s $15.7 billion in total sales
topped the $15.3 billion that analysts predict Microsoft Corp. will
report tomorrow. Apple surpassed Microsoft as the largest technology
company by market value earlier this year.

This year, Apple may ship 12.9 million iPads, ISuppli Inc. said this
week. Previously the El Segundo, California-based research firm had
expected 7.1 million.

Conclusions

Blow Out Numbers

Net income  fell to $613 million, or 78 cents a share, from $3.44
billion, or $4.93, a year earlier, New York-based Goldman Sachs said
in a statement today. The average estimate of 21 analysts surveyed by
Bloomberg was for earnings of $1.99 per share, with estimates ranging
from 77 cents to $4.34. Overall revenue  dropped to $8.84 billion, 31
percent below the first quarter and down 36 percent from the second
quarter of last year. The biggest component, revenue from trading
fixed- income, currencies and commodities, fell to $4.4 billion from
$7.39 billion in the first quarter and $6.8 billion a year earlier.

Costs during the quarter included a $600 million charge for a tax
levied by the U.K. government on bonuses  paid to bank employees last
year as well as a $550 million cost from the SEC settlement. Excluding
those two items, earnings per share would have been $2.75 per share.
That’s still the lowest since the fourth quarter of 2008.

“We certainly hope to have better returns than this in the future,”
Viniar told reporters on a conference call today. “We expect our ROE
over the cycle will be significantly higher than this.”

Conclusions

Its a Cheap Stock.

Goldman Sachs and Apple compared Wolfram Alpha
http://j.mp/cYPkPi

Julian Robertson famously wound down his hedge fund at Tiger
Management LLC a decade ago amid losses and turned to managing his own
fortune.Now, the 78-year-old legendary investor is considering
reopening Tiger, a launching pad for young money managers, to the
outside world.

Conclusions

Once upon a Time, they were my biggest Customer on Repo at CSFB.

Stocks staged a strong midday rally to finish in positive territory
for the second day in a row, shaking off deep losses as optimism grew
ahead of a fresh wave of bank earnings and guidance from the Federal
Reserve.

The city has an infinite capacity to dazzle, with or without fireworks.

I recently watched the Miami Beach sun cast golden late-afternoon
light into a seventh-level aerie atop a surreal parking garage that
serves at times as party space. The premiere of “Sex and the City 2”
was celebrated here, with a camel.This $65 million bravura composition
of intersecting planes and angular piers, called 1111 Lincoln Road,
does indeed park 300 cars in its mostly wall-free structure. It
includes fashion retailers and residences.The different levels
rhythmically jut forward and recede a bit. The floor heights range
from the parking standard of about 7 feet to as high as 34 feet. The
tall floors are best for parties.

He is tapping into what I call the “Art Basel Miami Beach Effect”
(updating the Frank Gehry “Bilbao Effect”). It’s a landmark to Miami’s
increasingly cosmopolitan and international allure.

The 1111 Lincoln Road parking garage. The $65-million space recently
hosted a "Sex and the City 2" premiere party. Source: Nelson
Garrido/MBEACH1 LLP via Bloomberg

Brazil is straining to satisfy sugar demand from Muslim nations
getting ready for a religious holiday marked by nighttime desserts.
This year, preparations for Ramadan, which begins in three weeks,
coincide with rains and rough seas at the ports of Brazil, the world's
biggest supplier of raw sugar. These weather conditions have created
bottlenecks that are hampering transportation of the sweetener to
world markets.The number of ships waiting to load sugar at the ports
of Santos and Paranagua has doubled compared with this time last year,
and trucks and railcars are also backed up.

I think the Softs in particular the Breakfast Commodities have
seriously inflected.

Conclusions

Headed Higher still.

The 50-year-old commodities trader last week bought up to 240,000
metric tons of cocoa beans from the London exchange, a haul valued at
about $1 billion, according to people familiar with the trades. His
London-based commodities trading house, Armajaro Holdings Ltd., now
presides over almost all the cocoa stored in warehouses across
Europe—as much as Americans consume in six months—and enough cocoa to
produce more than 15 billion Hershey's milk chocolate bars.

Conclusions

This Narrative is well worth unpicking. Day before yesterday The Back
Months were sold down over 5%. Yesterday The Toronto Star said it was
a 'Fat Fingers' Trade, which I doubt.

Furthermore, If someone took a $1b Physical Supply out of Coffee,
Sugar, Tea, I think you would tip all 3.

Last Price    3002
Contract High    3497
Contract Low    2280

Conclusions

Would like to be Long here.

Crude oil for September delivery, the most actively traded contract,
settled up 68 cents, or 0.9%, to $77.58 a barrel, after trading as low
as $76 a barrel earlier in the session.The contract for August
delivery, which expired at the end of floor trading, rose 90 cents to
settle at $77.44 a barrel.

Nearing Oversold.

Index Value:    2,546.74
Change:    Up 18.01 (0.71%)
Prev Close:    2,528.73
Open:    2,529.62
Day's Range:    2,520.15 - 2,547.31
52wk Range:    2,319.74 - 3,478.01

Conclusions

I am Bullish about this Index.

I think China Slow Down Hard Landing Fears are entirely overdone. They
have all the Ammunition.

Been doing a lot of Work around here.

Luxury spending in India, the world’s second-most populous nation, was
less than a tenth of that in China last year, according to Bernstein
Research. Wealthy shoppers’ penchant for the shopping centers of
Paris, London and Milan pose a challenge for companies such as LVMH
Moet Hennessy Louis Vuitton SA and Gucci parent PPR SA  in a country
where the biggest stock market rally  in 18 years produced about
42,000 millionaires last year.

“Indian consumers are buying a lot of luxury, but they aren’t buying
it here,” said Mohan Murjani, a retailer who gave up selling the Gucci
and Jimmy Choo labels two years after opening his first store in
Mumbai, India’s financial center, in 2007. “I don’t see luxury taking
off for at least another decade.”

Murjani, 64, garnered sales of less than $500 per square foot in his
stores, half of what he had projected in 2005, when he began planning
to bring luxury goods to a country where more than half of the
population survives on less than $2 a day. India has a population of
1.2 billion people.

India’s spending on luxury clothes, watches, jewelry and cosmetics was
about 600 million euros ($777 million) last year, according to a
Bernstein Research report. That compared with 6.6 billion euros for
China excluding Hong Kong, Macau and Taiwan, and 3.4 billion euros in
South Korea, a country with a population  of about 49 million.

“A buyer of a Cartier  watch doesn’t want to buy from a store that has
pushcarts selling bananas on the sidewalk,” he said.

The number of millionaires in India rose 51 percent to 126,700 last
year, according to the 2010 World Wealth Report by Bank of America
Corp.’s Merrill Lynch & Co. and Cap Gemini SA.

The Indian luxury market, including cars and jets, is forecast to
reach about $14 billion by 2010 end and then double to $30 billion by
2015, consultant AT Kearney predicted in 2007.

Luxury branded handbags at the new Louis Vuitton "maison" store in London.

High end clothing and shoes at Ermenegildo Zegna.

Conclusions

Interesting Luxury Divergence India versus China.

Nigeria’s banking index surged the most in almost four months after
President Goodluck Jonathan signed into law a bill to create a company
that will buy bad debts from them.

The Bloomberg NSE Banking Index that comprises of the top 10
capitalized and most liquid companies in the Nigerian banking industry
rallied gained the most in a week, rising 7.77, or 2.08 percent, to
close at 380.69 in the commercial hub Lagos. That’s the biggest gain
since July 13. Fidelity Bank Plc advanced the most in 10 weeks,
climbing 4.9 percent to 2.38 naira.

Advances were led by banks that received part of a 620 billion-naira
($4.1 billion) bailout from the West African nation’s central bank
last year after they failed an audit.Afribank Plc increased by the
maximum daily limit of 5 percent to close at 1.89 naira,
Intercontinental Bank Plc gained 4.7 percent to 1.79 naira, and
Oceanic Bank Plc rose 4.9 percent to 1.7 naira.

The Asset Management Corp. of Nigeria, or Amcon, will help to
“stimulate the recovery of Nigeria’s financial system from the recent
crisis by boosting the liquidity of troubled banks,” presidential
spokesman Ima Niboro quoted Jonathan as saying in an e-mailed
statement after the market closed yesterday.

“The effect may not be felt” until Amcon starts buying the toxic
assets and providing liquidity,” Anyanwu said.

The asset management company will buy about $10 billion in bad debts
by the end of the year, central bank governor Lamido Sanusi said on
July 1.

Bloomberg Nigeria Banking Index Bloomberg Visual [Click on the 5 Year Chart]
http://j.mp/aTKhSB

Value380.69   
Change7.770    
% Change2.084

Value24,816.83   
Change50.690    
% Change0.205

Conclusions

Should turn higher form here.

South Africa All Share Index Bloomberg Visual

Value27,349.61   
Change19.860    
% Change0.073

Conclusions

Still below the Scratch Mark for 2010 - 27666

One of the most democratic countries in the Horn of Africa is not
really a country at all. It is Somaliland, in the northwestern corner
of Somalia, which has been on a quixotic mission to be recognized as
its own separate nation since 1991. The Kulmiye party rallied in
Burao, one of the region's biggest towns. A presidential election,
scheduled for Saturday, will be one of the biggest tests yet for
Somaliland's budding democracy.

After a good run in the first six months of this year, the Nairobi
Stock Exchange faces yet another test in the August 4 referendum.
With less than two trading weeks to go before the vote on the proposed
set of laws.

“The bourse has an inherent skew in favour of a ‘Yes’ vote,” says Mr
Aly Khan Satchu, an investment analyst and NSE-licensed market date
vendor.

Conclusions

Its worth the same Quantum as we witnessed in the 1st Half 30%.

Wilson Murungi, commissioner of the Kenyan border district of Lagdera,
said al Shabaab gunmen ambushed a Kenyan border patrol and wounded one
officer. He said a team had been sent to beef up security and
investigate the incident.

"The attack was not a raid inside (Kenya). Our officers were attacked
as they conducted a normal patrol. The militias fired at them on the
other side of the border," Murungi told Reuters.

Residents near the Liboi border post in Kenya said there was a fierce
exchange of fire between the two sides.The Uganda bombings were the
first al Shabaab strike outside Somalia, although there have been
fears for some time in Kenya that the violence could spill over the
long and porous border between the two countries.

A clan elder in the Somali town of Dhobley on the other side of the
frontier told Reuters that two dead al Shabaab fighters were brought
there and buried on Tuesday.

"Here in Dhobley, al Shabaab are calling people to jihad against Kenya
and deploying more militias to the border. Local people fear new
fighting between the two sides," said elder Yusuf Ali Mohamed.

Conclusions

The Risk is very aysymettric.

The average price of Kenya's top tea rose to $3.29 per kg at this
week's auction from $3.20 per kg previously, traders said on Tuesday.

Conclusions

Based out?

Kenya missed its 2009/10 (July-June) fiscal year revenue target by
10.8 billion shillings or two percent, its tax collection agency said
on Tuesday.The east African nation, which has the region's biggest
economy, collected 545.2 billion shillings during the period, 11.2
percent higher than the previous year.The domestic taxes department
recorded the highest growth in collections at 13.2 percent followed by
customs, which collected 8 percent more taxes, the Kenya Revenue
Authority said in a statement.

Conclusions

At Face Value, a commendable Performance in what was a Sub Par
Economy, over that Period.

Investors will get two shares for every five held resulting in the
introduction of 80 million additional shares that will push the bank’s
listed stocks to 360 million.

The cut-off rate on Kenya's re-opened 25-year fixed coupon Treasury
bond is seen falling to 10.0 percent from 10.458 percent at June's
initial auction, a
Reuters poll of 10 analysts said. Results of the bond auction -- with
a coupon rate of 11.25 percent -- are expected later on Wednesday.The
Central Bank has offered 15 billion shillings ($183million). The
25-year bond's first issue was massively oversubscribed with bids
worth 27.1 billion shillings. The central bank had been looking for
7.5 billion.

Par Value:                  5/-
Closing Price:          21.75
Total Shares Issued:          230,000,000
Market Capitalization:        5,003M
EPS:            1.02
PE:                21.324

Swot Analysis
EPS 0.62 versus 1.02 Full Year 2009
Interim Dividend 0.35

The NSE20 closed down 15.35 points at 4329.95.

The NASI fell 0.82 points to close at 95.87.
EquityTurnover was 234.554m versus 194.478m last time.
Market Cap was 1.118606 Trillion versus 1.128201 Trillion.

The Bourse traded off today as Caution began to seep into the market.
We remain no less than 2% of our 2010 and 22 Month Highs.

Rea Vipingo closed higher at 17.40 and traded 400 shares.
Kakuzi traded 4,200 shares and closed at 72.00.
Sasini Tea traded 15,700 shares and closed at 13.75.

I think Tea Prices have once more based out and have posted their Low
Prints for the Year. I think the Breakfast Commodity Asset Class
[Cocoa, Tea, Coffee, Orange Juice and Sugar] will post a strong Run
into Year End.

SAFARICOM

shares volume     4.307M
avg price     5.70 Closing Price 5.70 -1.72%
high price     5.90
low price     5.50
last price     5.70

Conclusions

A Very curious 2 Sessions. For it to trade with so Few Bids [It traded
5.50] confirms an enormous amount of Signalling. I think the Pull Back
a curious Swoon within a Bull Run which will test 6.10 probaly
sometime in the 2nd week of August.

Access Kenya traded 23,500 shares and closed at 20.00.

ScanGroup was low ticked 5.194% to close at 36.50 and traded 23,000 shares.

Kenya Airways eased 0.5376% to close at 46.25 and traded 59,800 shares.

TPS Serena traded 24,000 shares at an unchanged 59.00.

Nation traded 3,800 shares and was unchanged at 143.00.
Standard closed lower at 37.50 and traded 1,300 shares.

CMC Holdings firmed 5 cents to close at 12.70 and traded 38,300 shares.
CarGen traded 700 shares unchanged at 48.50.

Equity Bank was the most active Counter at the Bourse. Equity Bank
eased 1.04% to close at 23.75 and traded a 23.00-24.25 range and
3.374m shares. Equity Bank posted a +46% 1st Half Yesterday. There is
I believe an unfinished Sell Order of some size where a remainder
still is to be cleared.
KCB was the 2nd most active Counter. KCB dipped 0.28% to close at
17.75 and traded a 17.60-17.95 range and 2.132m shares. KCB trades on
a Trailing PE of 8.5 ahead of the 2 for 5 Rights Issue and has an
Earnings Acceleration under way +16% 1st Half +10% 1st Quarter 2010,
which makes the current price very attractive and I surmise at the
Bottom of this Years Trading Range.
COOP Bank traded 4th and eased 0.68% to close at 14.65. COOP Bank
traded a 14.60-14.90 range and 900,600 shares.
Barclays Bank eased 0.72% to close at 69.00 and traded 135,600 shares
worth 9.378m and Supply was 3x Demand, which is an Inversion after
several weeks of being the opposite way around.
Stanchart eased 0.41% to close at 243.00 but was trading 247.00 +1.23%
session Highs at the Finish Line. StanChart traded 19,200 shares worth
4.606m and 257.00 is its all time Closing High, just over 3 and a Half
Years ago. We are not far away.

HFCK reported Half Year EPS at 0.62 versus 1.02 for the Full Year 2009
and announced a 35c Interim Dividend which will be well taken. HFCK
was unchanged at 21.75 and traded 119,000 shares.
NBK [Where the CMA gave the Nod to the Bonus Issue] was unchanged at
39.25 and traded 9,900 shares.
CFC StanBic was unchanged at 84.50 and traded 11,300 shares.
DTB eased 1.09% to close at 90.50 and traded 6,200 shares.
NIC rose 0.65% to close at 38.50 and traded 37,200 shares.

Centum eased 1.75% to close at 19.65 and traded a 19.15-20.00 range
and 73,800 shares.

Kenya Re eased 0.44% to close at 11.30 and traded 58,000 shares.
Jubilee firmed 0.61% to close at 164.00 and traded 9,300 shares.
PanAfric did not trade.

Olympia Capital closed at 7.45.

KenolKobil released a Press Statement found here http://j.mp/2DMFVE
The MD Jacob I. Segman is confirming that KPRL have been ordered to
release all KenolKobil's Product Entitlement, which they have been
holding since July 13th. KenolKobil is also filing a Claim against
KPRL For Damages and Loss of Business and Revenue. The Price
reacted naturally to this Step Up in Noise and traded a 9.90-11.00
range and closed 2.425% lower at 10.05. KenolKobil traded 1.140m
shares worth 11.213m.
Total dipped 0.85% to close at 29.25 and traded 57,200 shares.

Bamburi Cement eased 1% to close at 198.00 and traded 40,800 shares
worth 8.108m.
ARM rose 0.71% to close at 142.00 and traded 8,700 shares. It displays
very low Beta and is not far off its all time Closing High.
Portland traded a 100 shares at 115.00 unchanged.

Carbacid was the Top Gainer at the Bourse closing at 160.00 +7.38% and
trading 700 shares,
BOC Kenya did not trade.

KPLC was unchanged at 195.00 and traded a 195.00-198.00 range and
32,800 shares worth 6.397m.
KenGen eased 2.56% to close at 17.10 and traded a 17.00-17.45 range
and 180,800 shares.
Cables was unchanged at 19.50 and traded 57,200 shares.

Mumias Sugar was unchanged at 12.60 and traded a 12.55-12.65 range and
751,000 shares.

EABL was unchanged at 180.00 and traded 5,900 shares.

BAT traded a 100 shares at 231.00 -2.94% and was in fact Low Ticked.
Crown Berger closed unchanged at 32.50 and traded 2,000 shares.
Eveready closed 1.27% easier at 3.90 and traded 24,800 shares.
Sameer fell 3.61% to close at 8.00 and traded 55,500 shares.
Unga closed at 12.75 and traded 4,100 shares.