|Tuesday 24th of March 2015
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0930-1500 KENYA TIME
Normal Board - The Whole shebang
Prompt Board Next day settlement
Expert Board All you need re an Individual stock.
The Latest Daily PodCast can be found here on the Front Page of the site
very much looking forward to hosting @MikeMachariaSST at #Mindspeak
this Saturday @InterConNairobi
@BobCollymore Esquire of @Safaricomltd has kindly offered us a Live Feed
23-MAR-2015 Crude Oil
CRUDE oil was last trading at $46.57 a barrel on the New York Metals
and Energy Exchange. In June last year, this contract was just shy of
$100 a barrel. I expect a sharp slide below $40 a barrel because there
is currently no more storage. The World is awash with the black stuff
and the Americans are also considering lifting an export ban, which
will tip the market into a tailspin.
If Iran is rehabilitated - and all the signals now point in this
direction - an additional one million barrels will be pumped into the
international markets. The only way to bring this market into
equilibrium is for massive cuts in supply, and this will not happen.
In fact, instead of pumping less, many countries are adding more in a
vain attempt to make up for the revenue shortfall.
I have written before about how the 'bear raid' on oil was a very
sophisticated strategy hatched by the erstwhile community organiser
from Chicago, USA, who morphed into the President, but also a
sophisticated 21st century oil warfare specialist.
A break below $40, and whenever oil falls, it is like a falling knife;
it's very difficult to catch it. There are some doomsday predictions
out there that a barrel could even cost $20.
Now, you do not have to be a rocket scientist to appreciate that some
countries are now at breaking point. Venezuela president Nicolas
Maduro's 'Chavez Model' survived all sorts of coup attempts, but oil
below $40 is a bullet that cannot be dodged. Vladimir Putin's Russia
will buckle more, but the Russian psyche is really resilient and the
pain threshold much higher than in other countries.
Let's come closer to home and look at the erstwhile high-fliers,
Nigeria and Angola. It is a fair question to ask: Can these
governments survive less than $40 a barrel oil?
@alykhansatchu Good Morning from the 8th Floor and a wet Nairobi
Walk through the first rainstorm of the season and it slowly hits you:
that fresh, earthy smell.
Before it hits the ground, rain is just water. It has no smell. But
after the drops hit the ground and interact with dirt, the fresh and
almost sweet fragrance of rain is let go. Now, scientists think
they've identified the exact mechanism that releases this aroma into
The smell actually has a name. It's called "petrichor," from the Greek
words "petra," meaning "stone," and "ichor," which refers to the fluid
that flows like blood in the veins of the gods.
"Speed now illuminates reality whereas light once gave objects of the
world their shape." -- Paul Virilio
Currency Markets at a Glance WSJ
Dollar Index 97.28
Japan Yen 119.70
Swiss Franc 0.9677
India Rupee 62.195
South Korea Won 1107.93
Brazil Real 3.1324
Egypt Pound 7.6284
South Africa Rand 11.9317
Dollar Index 3 Month Chart INO 97.28 [I reckon its headed to 110.00]
With supply remaining tight, the median price for a previously owned
home was $202,600 in February, up 7.5 percent from a year ago.
That was the largest percentage gain since February last year and
suggested that the pace of home price increases, which had been
slowing after double-digit growth for much of 2013, appears to be
Euro zone consumer confidence jumped much more than expected in March
to -3.0 points from -6.7 points in February, the first estimate from
the European Commission showed on Monday.
Euro versus the Dollar 3 Month Chart 1.0919 [0.9300 Target]
In the negative-yield vortex that is the European bond market,
investors are discovering just what lengths they're willing to go to
Norway's $870 billion sovereign wealth fund said this month that it
added Nigeria and lifted its share of lower-rated company debt to the
highest since at least 2006. Allianz SE, Europe's biggest insurer, is
shifting from German bunds to bulk up on mortgages. JPMorgan Asset
Management is buying speculative-grade corporate debt to boost
With the European Central Bank's fight against deflation pushing
yields on almost a third of the euro area's $6.26 trillion of
government bonds below zero, even the most risk-averse investors are
taking chances on assets and regions that few would have considered
just months ago. That's exposing more clients to the inevitable
trade-off that comes with the lure of higher returns: the likelihood
of deeper losses.
"We are wandering into uncharted territory that's subject to
uncertainty and mistakes," said Erik Weisman, a Boston-based money
manager at MFS Investment Management, which oversees $430 billion
globally. He's buying debt with longer maturities and increasing his
allocation of top-quality government holdings to Australia and New
Zealand, which have some of the highest yields in the developed world.
12-JAN-2015 THE YEAR OF G2 AS EUROPE OFF BALANCE
Europe printed a negative year-on-year deflation rate of 0.2 per cent
in December and the European Commercial Bank is imminently looking to
launch a Quantitative Easing [money-printing] programme.
The euro/dollar exchange rate is headed to parity and even lower in
2015. I know Goldman Sachs has a parity call for euro/dollar in 2016,
but I think the unravelling will happen in 2015 and a lot more
The economic blowback from the frozen conflict in Ukraine with Russia
has exacted a price, as well. Economics and geopolitics are more
intertwined than ever before. If European bond yields - they are at
record all-time lows - are the 'signal in the noise', then this means
Europe is in danger of a major 'death-spiral'.
Egypt, Ethiopia and Sudan sign agreement over Nile water resources as Addis Ababa builds dam
KHARTOUM, Sudan - Egypt, Ethiopia and Sudan have signed an initial
agreement on how to share water from the Nile River that runs through
the three countries, as Ethiopia constructs a massive new dam it hopes
will help alleviate some of its electricity shortages.
Egyptian President Abdel-Fattah el-Sissi, Sudanese President Omar
Bashir and Ethiopian Prime Minister Hailemariam Desalegn welcomed the
agreement in speeches in Khartoum's Republican Palace on Monday. They
earlier watched a short film about the Grand Renaissance Dam that
highlighted how it could benefit the region.
Officials from the three countries had worked out the agreement
beforehand in recent meetings in Khartoum.
Senegal jails ex-president's son for 6 years for corruption
Knight Frank The Wealth Report PDF
monaco once again tops our list of the world's most expensive prime
residential property. US$1m will buy you just 17 sq m of home there,
compared with 204 sq m in cape town -- p39
Cities of the future
Addis Ababa, Ethiopia
Africa's fastest-growing economy, Ethiopia, benefits from not only the
political importance of Addis Ababa but also the 3.8% annual growth
rate of the population within the capital. In addition to natural
growth, there is vast rural- urban migration, which planners predict
combined could lead to the size of the city surging by 2040 to over
Wealth creation has seen a near doubling of the population of HNWIs
since 2007 to a little over 1,300, with one of the strongest forecast
growth rates for the coming decade - with an expected expansion to
2,600 by 2024.
The decline of Cairo's commercial influence at the northern end of Af-
rica, and the realisation by international busi- nesses that they
cannot run the entire continent from Johannesburg in the southern tip,
has created a vacuum that Nairobi is eagerly filling. With the arrival
and expansion of a string of multinationals, the city is now firmly
established as one of Africa's leading hubs. Local developers have
responded by build- ing Grade A quality office space that is
attracting top-quality tenants pay- ing dollar-denominated rents with
leases that include fixed annual in- creases. Generally, rents are
perceived as good value by international firms, suggesting there is
room for healthy future rental growth and also yield shift, which in
turn is attracting global investors. In addition, newly discovered oil
and gas deposits are creating something of an energy boom, while all
sectors of Kenya's economy, apart from tourism, are growing -- GDP is
rising at around 5.5% each year. This is largely being driven by a
burgeoning middle class hungry for Western-style goods and shopping
experiences that, by and large, seems impervious to political
controversies and terror- ism activities. This year should see the
opening of around 1.8m square feet of First-World shopping malls in
Nairobi, with new international retailers committing to the region for
the first time.
South Africa All Share Bloomberg +6.65% 2015
Dollar versus Rand 6 Month Chart INO 11.9317
Egypt Pound versus The Dollar 3 Month Chart INO 7.6284
Egypt EGX30 Bloomberg +5.05% 2015
Nigeria All Share Bloomberg -13.70% 2015
Nigeria's foreign exchange reserves declined to $30 billion by March
20, down 6.7 percent from $32.2 billion a month earlier.
Nigeria set for post-election rate rise Reuters SABC
Uncertainty about the outcome of this weekend's presidential election
will prompt Nigeria's central bank to keep interest rates on hold at a
meeting on Tuesday, but a rise is likely in the second quarter, a
Reuters poll found on Monday.
Africa's biggest oil producer has been hit by the plunge in oil prices
and a crisis in the naira is stoking inflation.
"At this point it is sensitive because of the elections, I don't see
them doing anything at this point, but they will have to raise rates
after the elections," said Aly Khan Satchu, an independent trader at
Rich Management in Nairobi.
"The other worry is that the oil price is going down again," Satchu said.
The poll forecast that Nigeria's benchmark interest rate, which has
been at 13 percent since November when it was raised for the first
time in two years, will rise 100 basis points to 14 percent in the
By the end this year the benchmark rate will be at 14.50 percent, the
UPDATE 2-Zambia c.bank's new governor to tackle volatile kwacha
"We don't rule out any instrument if that is what will get us the
intended results. All instruments are on the table," Kalyalya said
when asked whether the central bank would consider a further increase
of the statutory reserve ratio.
Zambia's central bank increased the amount of money that commercial
banks have to deposit with it to 18 percent from 14 percent as from
"The Bank of Zambia issued the circular announcing the hike of the
statutory reserve ratio late on Friday," a commercial bank trader
said. (Reporing by Chris Mfula; Editing by James Macharia)
Thomson Reuters 2015 All rights reserved
Ghana Stock Exchange Composite Index Bloomberg -2.89% 2015
Ghana will seek bridge finance of between $300 million and $1 billion
in the first half of this year to redeem maturing domestic debt,
according to a memo to parliament signed by Finance Minister Seth
The debt finance plan emerged as Moody's downgraded Ghana's sovereign
rating and put the West African country on a negative outlook to
reflect its increasing debt burden, large fiscal imbalances and a
sharp weakening of the cedi currency.
The memo seen by Reuters said the government would also issue a
Eurobond of up to $1.5 billion in the second half of the year to
retire the bridge finance, refinance domestic and external debt and
fund 2015 capital expenditure.
Angola expects oil output to average 1.84 million barrels per day
(bpd) this year, up 10 percent from 1.67 million bpd in 2014,
according a revised 2015 budget passed by parliament on Thursday, the
state news agency said.
Oil accounts for around half of Angola's GDP, 80 percent of tax
revenues and 90 percent of export earnings.
ISIL eyes East Africa - and foments division
Nigeria's Boko Haram swore allegiance recently to the Islamic State of
Iraq and the Levant (ISIL) in an audio message with French and English
What most failed to notice was a few weeks earlier an "emissary" of
ISIL sent a public invitation to the emir of al-Shabab in Somalia, Abu
Ubaidah, urging him to do the same.
The emissary was Hamil al-Bushra, the nom de guerre used by two media
outlets that have been described by Washington Institute for Near East
Policy fellow Aaron Zelin as "official semi-official accounts" from
In the message Bushra praised the "brothers in Somalia" and encouraged
them to attack "inside Kenya, Tanzania, Ethiopia". He told Abu Ubaidah
all that is needed to pledge loyalty to ISIL is for the al-Shabab
media wing, al-Kataib, to issue an audio message.
Nation Media reports FY PAT 2014 -2.869% Earnings here
Par Value: 2.50/-
Closing Price: 245.00
Total Shares Issued: 188542286.00
Market Capitalization: 46,192,860,070
Large media group inclusive of Daily Nation, Business Daily, East
African and Nation Television.
Full Year Earnings through Dec 2014 versus through Dec 2013
Full Year Revenue 13.3513b versus 13.3737b -1.674%
Full Year Profit before Tax 3.624b versus 3.5871b +1.0286%
Full Year profit after Tax 2.4605b versus 2.5332b -2.869%
Full Year Earnings Per share 13.1 versus 13.4 -2.23%
Final Dividend 7.50 a share [+2.50 Interim]
''adverse impact of 230m charge in the accounts in respect of
accelerated depreciation and write off of analogue broadcasting
The Digital Migration Fracas occurred in 2015 and therefore was not
captured in the reporting period.
Nation Media is a strong Franchise but the entire approach to the
Migration has been perplexing, to say the least
The Business Daily recorded an 85 per cent jump in operating profit on the back of a 10 per cent increase in revenue.
Regional newspaper, The East African which celebrated its 20th
anniversary last year, grew its profit by seven per cent after an
equivalent growth in revenue.
The expansion was in spite of encountering challenges in the Tanzanian
market where its circulation has been stopped by the government. The
management, however, said it is in discussions with the Dar
authorities to reinstate circulation.
The television division also recorded revenue growth of 23 per cent on
the back of investment in new programmes such as Pray and Prey, Auntie
Boss and Pendo.
NTV Uganda recorded profit growth following a seven per cent increase
in advertising revenues.
Kenyan Mines Minister Expects Law to Boost Investment Interest @Bloomberg
Kenya expects to enact a mining law later this year to provide policy
stability in a country ranked by an industry institute as one of the
world's least attractive places to invest, Mining Secretary Najib
The Mining Bill, currently before the East African nation's Senate, is
expected to be passed before the fiscal year ends on June 30 and begin
a "new era" for mining in Kenya, Balala said in an interview on March
20 in the capital, Nairobi.
"There have been bad practices before, so we want to change that,"
Balala said. "This bill is good not only for the government, but also
for the industry as it guarantees them stability, it guarantees them
their rights. It also brings transparency to the process."
Kenya is overhauling its mining code to increase the share of revenue
from an industry that represents only about 1 percent of gross
domestic product, partly because poor regulation has deterred
investment. Under the new law, the government will impose royalty
rates ranging from 1 percent of the gross sales value of industrial
minerals such as gypsum and limestone, to 10 percent for coal,
titanium ores, niobium and rare-earth elements, and 12 percent for
Kenya is the world's third-biggest producer of soda ash, used to make
glass, and ranks seventh in output of fluorspar, used in steel,
according to the U.S. Geological Survey. It also has deposits of coal,
gold, rubies and sapphires. Randgold Resources Ltd., a producer of the
metal in Africa, said last year it planned a study of Kenya's
gold-mining potential. It doesn't produce any diamonds.
The country ranked third from bottom on the Investment Attractiveness
index published in the Vancouver, Canada-based Fraser Institute's
annual survey of mining companies last month.
The report assesses what impact mineral endowments and policies such
as taxation and regulatory uncertainty have on exploration investment.
It cited a lack of transparency in Kenya's mineral-title process and
"terror threats" as factors behind the ranking, which only beat
Malaysia and Hungary. Balala said he was "surprised" by the results of
"Maybe it is a lesson for us to improve," Balala said. The government
has taken steps to improve security, he said, after "terrorist
attacks" in Kenya killed at least 361 people since September 2013,
according to Bath, U.K.-based risk consultancy Verisk Maplecroft.
Shortly after his appointment in 2013, Balala canceled 43 prospecting
and mining licenses after saying the government discovered
irregularities in the way they were granted.
Cortec Kenya Mining Ltd., a subsidiary of Kelowna, Canada-based
Pacific Wildcat Resources Corp., lost its case in the Kenyan High
Court in which it accused Balala of illegally revoking its permit.
Cortec is appealing the ruling.
The government is also "achieving some progress" in a continuing
dispute with Base Titanium, the Kenyan unit of West Perth,
Australia-based Base Resources Ltd., over royalty payments. The
government wants to increase the amount that Base pays from the 2.5
percent the company says was "locked in" in a previous agreement with
"We are in agreement in principle that they are willing to pay a 5
percent royalty," Balala said. "According to the world, 5 percent is
the right figure. So if they want to pay 2.5 percent it's not fair."
Base Titanium spokesman Simon Wall, in an e-mailed response to
questions, confirmed the talks with the government "for an increase of
this agreed rate to reflect current global mineral sand royalty rates,
with 3.5 percent being the average and 5 percent the highest."
"I think some of these companies need to appreciate there is a new
era," Balala said. "They need to appreciate the resources need to be
shared by the people."
The Nairobi All Share rallied 0.55 points to close at 172.57.
The Nairobi NSE20 retreated 11.07 points to close at 5254.60 and has
retreated 245 points since closing at a more than 7 year high at the
beginning of the month.
Equity Turnover clocked 770.521m.
Safaricom +13.879% in 2015 and Jubilee +24.222% in 2015 set Record
Life time closing Highs.
N.S.E Equities - Commercial & Services
Nation Media reported FY 2014 Earnings where FY Turnover ticked
1.674% Year on Year to 13.3513b, FY PAT declined 2.869% to 2.4605b.
Nation will pay a Final Dividend of 7.50 a share. The Media Co. cited
the ''adverse impact of 230m charge in the accounts in respect of
accelerated depreciation and write off of analogue broadcasting
equipment....'' as crimping earnings. Both Nation Media and Standard
Group were caught up in the 'Digital Migration' Fracas but that
occurred this year and not during this reporting period. Nation Media
has a real solid Franchise. Nation Media firmed 1.63% to close at
249.00 and traded 7,800 shares. Nation Media is -5.32% Year To date.
Safaricom rallied 0.63% to close at 16.00 for the first time and set a
record closing High. Safaricom traded 6.653m shares and traded shares
as high as 16.10 during the session. Safaricom has surged +13.879% in
2015 and has underpinned the Bull Market in 2015.
@Safaricomltd share price data here +13.879% 2015 and at a record
Interview with @BobCollymore CEO @Safaricomltd Nov 2014 @YouTube
Man of the Moment @bobcollymore #Safaricom
Uchumi bounced a further +2.816% to close at 10.95 and traded 463,800
shares. Uchumi has rallied +8.955% over two trading sessions.
N.S.E Equities - Finance & Investment
Kenya Commercial Bank closed unchanged at 60.00 and traded 2.352m
shares. Kenya Commercial Bank is +5.26% and targets Fresh Record All
Time Highs above 61.00 in short order.
Equity Group closed unchanged at 49.25 and traded 3.513m shares worth
173.808m following yesterdays sharp slide of 3.43%.
Standard Chartered which was marked down 2.36% yesterday on odd-lot
trading rebounded +4.53% today to close at 346.00 and traded 22,600
Jubilee Holdings rallied 1.636% to a Fresh Record Closing High of
559.00 and traded 23,600 shares. Jubilee has now surged +24.222% in
Jubilee Holdings share price date here +24.222% in 2015
N.S.E Equities - Industrial & Allied
KPLC closed unchanged at 18.40 and traded meaningful volume of 3.526m
shares worth 65.022m. KPLC has been a Stand-Out Performer in 2015 and
is +27.33% Year To date.