|Thursday 27th of May 2010
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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
Mindspeak 29th May 0930 am for 10 am Start
Westgate Cinema 1
Guest Speaker Sicily Kariuki MD The Tea Board
I had Tea yesterday with Sicily at the Tea Board. Its a near enough
$1b Industry and Sicily has both a compelling story of her own and
about Tea, to tell.
The [Tea] Farmers will drive the Ferraris The Star
Kenya The Silicon Valley of Mobile Banking The Star
I think You can go Long the Shilling versus The Euro.
The Little One has a finely honed Emotional Intelligence and I suppose
it is part a result of having 2 Older Sisters and the early and urgent
requirement to swim in order not to sink. Her latest Tactic is to ask
with a very straight Face
Are You a Step Father or Mother ? And then to repeat the Question with
a very straight Face.
No Never Come on Give me a Break.
Well why are you shouting?
By this stage, My Voice is a Whisper. In fact, it was never raised.
Its all rather nuanced but I am being outwitted and outflanked by my 4
Iran warns Russia over sanctions support FT
Law & Politics
Iran’s president delivered a rare rebuke to Russia on Wednesday,
saying that Moscow would be considered an “historic enemy” if it
supports US efforts to place more pressure on the Islamic regime.
Mahmoud Ahmadi-Nejad, the Iranian president, responded to Russia’s
support for the US draft, saying: “If I were the Russian president,
when making decisions about subjects related to a great nation [Iran],
I would act more cautiously,” he said. “The Iranian nation doesn’t
know: are they [the Russians] our friends and neighbours? Are they
with us or are they looking for something else?”
Referring to the US, Mr Ahmadi-Nejad added: “It is not acceptable for
the Iranian nation that our neighbour [Russia] stands by those who
have been hostile to Iran over the past 30 years.”
The president said: “I am hopeful that Russian leaders and authorities
will pay attention to these friendly words and take corrective action
and not let the Iranian nation consider them among the ranks of its
Cool dude, or just a square in a suit? THE BRIDGE: THE LIFE AND RISE OF BARACK OBAMA BY DAVID REMNICK
Law & Politics
Obama's genealogy, we learn, is vast. There's a step-grandmother who
speaks only Swahili and a half-brother in Indonesia who converses in
Mandarin Chinese. That he has a cousin who is a rabbi is less
surprising than the news that some relatives 'look like Margaret
But no one can claim that Obama really struggled, and as his wife
Michelle said with irony: 'Maybe one day he will do something to
warrant all this attention.'
'The fact that I conjugated verbs and speak in a typical Midwestern
newscaster voice - there's no doubt that this helps ease communication
between myself and white audiences.'
The important point is that Obama declared that 'I want to be the
opposite kind of husband and father that my father was'.
From the outset of his career 'I had a hunger to shape the world, to
make the world a better place'. People thought him 'a saint and a
square, behind the cool cat facade'.
The turning point, according to Remnick, was the publication in 2004
of photographs of those prisoners being tortured at Abu Ghraib.
Americans were sickened at the horrendous treatment being conducted in
their name and, 'despairing of George Bush', they began thinking that
Obama represented a fresh start, with his promises to restore human
Currency Markets At A Glance
Dollar Index 86.75
South Korean Won 1225.50 from 1253.45
The euro fell to $1.2197, down from $1.2308 late Tuesday. It touched a
four-year low near $1.2144 on May 19. The shared currency is on track
for its biggest monthly drop since January. There were reports that
China is reviewing its holdings of European bonds.
Barton Biggs Says Stock Market Set to ‘Pop’ in Days Bloomberg
World Of Finance
U.S. stock markets are oversold and may rally strongly over the next
few days, said investor Barton Biggs, who runs New York-based hedge
fund Traxis Partners LP.
“I think they’re going to stabilize in this general area, and then
we’re going to have a significant move to the upside,” Biggs, whose
flagship fund returned three times the industry average last year,
said in a Bloomberg Television interview.
“The market is very, very oversold, and I think we’re going to have a
big pop to the upside some time in the next couple of days,” said
Biggs. “I wouldn’t be surprised to see us go to a new recovery high,
just to make everybody squirm.”
It is very oversold now.
China reviews eurozone bond holdings FT
World Of Finance
Safe, which holds an estimated $630bn of eurozone bonds in its
reserves, has expressed concern about its exposure to the five
so-called peripheral eurozone markets of Greece, Ireland, Italy,
Portugal and Spain.
A spokesman for Safe refused to comment. An estimated 70 per cent of
China’s reserves are held in US dollar securities, but the composition
and management of the funds controlled by Safe are regarded as state
According to the latest figures announced by Safe, the country’s
foreign exchange reserves totalled $2,447bn at the end of March, up
$174bn in just six months.
Who has the Money? HU DOES.
Can Twitter Promote Itself into Profitability? Knowledge at Wharton
Information & Communication Technology
It was a tweet like many others from Starbucks, promising free refills
to customers who brought in reusable tumblers on Earth Day.
But the message came to users in a different way -- it appeared at the
top of Twitter search results pages, even for those who weren't among
the coffee giant's followers. And there was a tiny tag in the corner
of the update, outlined in yellow and reading "Promoted by Starbucks
"We're going to live in a world where we need to be generating
hundreds of millions of dollars in revenue," Costolo told Reuters.
"We're thinking about big, big numbers."
Twitter then began to grow more quickly, with the company reporting
500,000 tweets per quarter in 2007 and then 100 million per quarter
the next year. For the first quarter of 2010, the company reported
that more than four billion tweets were sent using the service.
"The real challenge, though, is how Twitter is going to monetize
this. It is not obvious at the moment," says Eric Bradlow, a Wharton
marketing professor and co-director of Wharton Interactive Media
Initiative (WIMI), noting that the trick for Internet businesses has
been implementing money-making modifications without alienating, and
"Tweeting is a wildly simple way to express my thoughts or share notes
with friends and those with common interests.... I'm constantly
pulling links out of tweets and into my browser," he adds. "I follow a
wide variety of users. Some are friends, some are people with smart
perspectives on issues I care about [and] some are publications or
It is the Wild West out there right now with all these methods of communication.
M.I.A.’s Agitprop Pop NYT
M.I.A. on the roof of the Ohm Building in New York
On the Grammy Awards in 2009, Maya Arulpragasam, also known as M.I.A.,
performed her biggest hit, “Paper Planes,” a rap song that infuses
rebellious, defiant lyrics with the sounds of her native Sri Lanka, a
riff lifted from the Clash, the bang-bang of a gun and the ka-ching of
a cash register. Maya, as she is called, was nine months pregnant (to
Commodity Markets at a Glance WSJ
Gold for June delivery, which still had the most volume, settled with
a gain of $15.40, or 1.3%, to $1,213.40 an ounce on the Comex division
of the New York Mercantile Exchange. August, which now has the most
open positions, climbed $15.50, or 1.3%, to $1,215.30. Neither had
finished above $1,200 since May 18.
Prices also got a boost from a World Gold Council report forecasting
rising demand for the metal on the sovereign risk concerns and
physical demand from Asia.
As a measure of growing interest in gold as an investment, holdings in
the SPDR Gold Trust /quotes/comstock/13*!gld/quotes/nls/gld (GLD
118.46, -0.01, -0.01%) , the largest exchange-traded fund backed by
gold, posted a fresh record as of Tuesday.
The ETF reported 1,267 metric tons (1,396 short tons) in gold in the
trust, an increase from the 1,237 metric tons reported Monday.
Live Crude Oil chart 71.75 last
Minerals, Oil & Energy
Crude futures rose 4% Wednesday as investors adopted a more optimistic
outlook on the world economic recovery. Global gross domestic product
is still on track to expand by 4.6% this year, the Organization for
Economic Cooperation and Development said Wednesday, up from a
prediction of 3.4% GDP growth.
Zimbabwe grows for first time in 11 years FT
Zimbabwe has recorded its first year of economic growth for more than
a decade, a report from the International Monetary Fund said.Gross
domestic product rose 4 per cent last year, the first expansion in 11
In its base case scenario, the IMF projects annual growth of less than
1.5 per cent until 2015. Zimbabwe needs “a significant improvement” in
its business climate, says the IMF, notably by enforcing property
rights, seeking international debt relief and enforcing labour laws.
Mr Mugabe has damaged investor confidence by promising to enforce a
law requiring all foreign or white-owned companies with assets above
$500,000 (€408,500, £348,000) to hand over 51 per cent of their shares
to “indigenous” Zimbabweans.
The IMF warns about public finances, saying Zimbabwe is in “debt
distress” with $4.6bn of arrears, a sum which can realistically be
cleared only with agreed debt relief. The government should tighten
its fiscal stance by some 3 per cent of GDP and reimpose cash
budgeting on ministries, which has been allowed to lapse.
The key challenge is to trim public sector wages by 1 per cent of GDP
by laying off workers. The IMF says that with its “active policy”
reform scenario, annual growth should accelerate to 5 per cent. But
government ministers are instead predicting highly optimistic
double-digit rates of growth.
Ghana Considers Second Dollar Bond Sale to Tap Demand Bloomberg
Ghana is considering selling its second dollar bond next year to tap
investor demand as the start-up of oil production boosts economic
growth and narrows the budget deficit, Deputy Finance Minister Fifi
Kwetey said.The government is considering a “no-deal roadshow” as
early as the fourth quarter to gauge international investors’
appetite, Kwetey said in an interview yesterday in Abidjan, the
commercial capital of Ivory Coast. “I’m certain that in 2011, we’ll be
looking at” selling a bond, he said.
“The only reason why we didn’t go back to the market since 2007 is
because we had our fair share of turbulence,” Kwetey said. “It’s
difficult to tell a good story when the budget deficit is that high,
when inflation has lost control. But now we can tell a good story.”
The price of Ghana’s 8.5 percent bond due October 2017 fell $2.63
yesterday to $99.25, the lowest level in almost seven months, raising
the yield on the security by 48 basis points to 8.64 percent. The bond
is rated B+ by Standard & Poor’s and Fitch Ratings, four levels below
investment grade.Ghana’s bond rating puts it on par with Africa’s two
biggest oil-producing nations, Nigeria and Angola, as well as Belarus,
Albania and Suriname. Nigeria is rated BB- by Fitch.
The government plans to cut the fiscal deficit to 7.5 percent of GDP
this year, while the inflation rate fell to a 28- month low of 11.7
percent in April. Inflation will probably slow to less than 10 percent
for the first time since 1999, possibly by September, Kwetey
said.Ghana is the world’s second-biggest cocoa producer after Ivory
Coast and the largest gold producer on the continent after South
A global bond will help to raise funds for infrastructure projects,
including power plants, to help sustain faster economic growth, Kwetey
said. The government estimates it needs $2 billion a year to fund its
infrastructure needs, he said.
“We have huge challenges in terms of the power sector,” Kwetey said.
“If we want to have the kind of sustainable growth we’re looking for,
we need to invest heavily in the energy sector.”
Economic growth will probably soar to 20 percent next year, from 5.7
percent in 2010, as Ghana begins oil production of about 120,000
barrels per day, Kwetey said. Oil is expected to earn the West African
nation between $550 million and $800 million in revenues in the first
year, he added.
Ghana is also close to agreeing a transaction with a group of banks to
raise about $1.2 billion to pay for cocoa purchases this year, Kwetey
“The discussions are at the final stages,” the deputy minister said.
“It shouldn’t be long. By the third quarter we’re likely to have
Ghana signed a trade finance facility for the same amount with 29
international banks in September last year to pay farmers for
purchases in the 2009-10 harvest. The country earns about 40 percent
of its foreign exchange revenue from cocoa.The government also secured
a loan of $1.02 billion from the International Monetary Fund in July
last year to help boost foreign currency reserves and ease the impact
of the global crisis. The central bank cut its benchmark interest rate
by 3.5 percentage points to 15 percent since November as inflation
Reasons why the Ghana All share is outperforming and I expect it to
push on quite a bit higher on this surge into Double Digits in GDP.
Ghana All Share Index Bloomberg Visual +28.195% 2010
Brazil launches international TV station for Africa BBC
Brazil has launched an international television station that will
broadcast to African nations.President Luiz Inacio Lula da Silva said
the aim of the Portuguese-language channel was to represent Brazil to
to the world.The channel shows Brazil's growing interest in Africa,
correspondents say.It will also soon also be available in Latin
America, Canada, Europe and the US, according to officials.Speaking at
the launch of TV Brasil Internacional at a ceremony in Brasilia,
President Lula described it as the realisation of a dream.
"I don't want a TV channel to speak well of Lula," he said. "I want a
channel that speaks well of the country, that can show Brazil as it
TV Brasil Internacional, based in Brasilia, will be re-broadcast via
Mozambique's capital, Maputo, to 49 African nations.
Going by the Popularity of Brazilian Soaps, this looks like a Sure Thing.
New telecoms rules put on ice Nation
Information & Communication Technology
The government has suspended the recently published rules on the
communications industry which had caused an uproar from Safaricom.
Consequently, it has invited competition law experts from the United
States who have three weeks to peruse afresh at the regulations for
mobile phone service providers in the country.The experts are to look
at the process of market segmentation and application of objective
criteria to identify dominant operators in each.They will also need to
define what constitutes abuse of dominance and when tariff regulations
apply as currently neither the ministry nor the regulator
Communications Commission of Kenya has mandate over control.
According to Information and Communication permanent secretary Dr
Bitange Ndemo, the review will be done within three weeks.
The PS made the admission while attending Safaricom Ltd 2009 financial
year results in Nairobi.The mobile phone service provider had over the
past weeks taken the battle to the governments doorstep demanding for
a review of the regime.
“I take full responsibility in the mistakes that are in the
regulations for having not looked at the rules before they were
published in details. We now have invited experts to give us their
take on them,” said Mr Ndemo.
The CCK gazetted the five new rules under the Kenya Information and
Communications Regulations 2010.
Positive. This Regulatory Risk had blinked amber.
The Star Safaricom and the Regualtor
Harbinger to Expand in Africa as Miners Flock to Last Frontier Bloomberg
Minerals, Oil & Energy
Harbinger Capital Partners LLC, the U.S. hedge-fund firm run by
billionaire Philip Falcone, plans to boost investment in African
resources as commodity companies compete for some of the world’s
biggest mineral deposits.
“Africa is the last untapped resource frontier left on earth,”
Harbinger Managing Director Lawrence Clark said in a telephone
interview. “Over time we’re going to work towards making more
investments, but we’re only going to do so with great caution.”
Companies from South America, Europe and Asia have been drawn to
Africa by its mineral riches, including the world’s biggest deposits
of platinum, chrome and diamonds. Capital flows into the continent
rose 16 percent in 2008 to a record $62 billion, even as foreign
direct investment around the world fell 20 percent, according to the
World Economic Forum.
THE “MIND BOGGLING BIODIVERSITY” OF TSAVO
Tsavo is Kenya’s largest national park and at 20,812 square kilometres
almost rivals Rwanda in its size. Home to an incredibly diverse array
of landscapes and wildlife the park is unrivalled in its biodiversity.
When Tsavo was formed in the 1940s the human population of Kenya was
one million, compared with 40 million people today. The land bordering
the park is becoming increasingly populated and human-wildlife
conflict is an issue which is becoming ever more apparent as people
and animals are forced into closer proximity.
The risk posed to elephants by poaching tells the same story. Prior to
the 1970s 36,000 elephants roamed across Tsavo, the drought is thought
to have killed 5,900 while poachers massacred 90% of the population.
Today only 6000 remain in the park and over the past year a number
have been killed for their tusks.
Respiratory Virus Appears To Be Commonly Identified Among Kenyan Children Medical New
Among infants and children hospitalized in Kenya with severe
pneumonia, respiratory syncytial virus (RSV) appears to be the
predominant virus detected, according to a study in the May 26 issue
The researchers found that RSV was the most commonly detected virus,
present in 260 admissions overall (34 percent), and in 192 of 453
infants (42 percent). Other respiratory viruses were detected in 219
admissions (29 percent), the most common being Human coronavirus 229E
(6.7 percent), influenza type A (5.8 percent), Parainfluenza type 3
(3.8 percent), Human adenovirus (3.8 percent), and Human
metapneumovirus (3.0 percent).
The Bourse has retreated for the 2nd Consecutive session after closing
at a New 2010 High Tuesday. The All share Index is up 28% in 2010.
The NSE20 closed 58.83 points lower today at 4203.40 and that makes it
a 2.708% correction from the Highs so far.
The NASI closed down 1.17 points at 90.70.
Market Cap was 1.0574 Trillion versus 1.070964 Trillion.
Equity Turnover was again robust at 728.712m versus 1.482b last time
in what has been very heavy action of late at the Bourse.
Retreats this year have been shallow and short lived and all things
being equal we are reasonably close to a turnaround.
N.S.E Equities - Agricultural
Kakuzi was marked down to close at 68.00 and traded 3,000 shares.
Rea Vipingo traded 3,700 shares to close at 16.80.
Sasini Tea traded 34,700 shares and closed at 13.25.
N.S.E Equities - Commercial & Services
shares volume 83.67m
total turnover 444,496,192
avg price 5.32 closing Price 5.30 -1.85%.
high price 5.90
low price 5.10
last price 5.30
Another heavy volume Session after yesterdays post IPO Record.
Safaricom traded 83.59m shares worth 444.496m and was the most active
Counter again as it has been for a string of consecutive sessions.
Safaricom traded a 5.10 intra day session low and put in a high Print
at 5.90 on the Prompt Board. At a closing price of 5.30 Safaricom
trades on a PE of 13.947 and has a Yield of 3.77% which is not that
far off 91 Day T Bills. I thought the results plain muscular and
expect a more constructive tone going forward. We might well have
flushed this outsize Position out at the 5.10 Low and I expect a push
higher over the next few sessions. There are few shares that can
project a 30% [at least] compound rate of growth going forward over
the next two years.
I cannot find one Analyst that had an EPS of 38 cents. I have to
believe there is a slew of Upgrades on the Horizon.
Access Kenya rallied 0.9% to close at 16.80 and traded a chunky slice
of its Equity some 1.237m shares [0.599% of its Equity] worth 20.818m.
Scangroup rallied 2.34375% to close at 32.75 and traded 225,000
shares. Scangroup is just 6.4% below its all time high Print at 35.00.
Nation closed 0.724% better at 139.00 and traded 49,100 shares.
Standard traded 1,300 shares to close at 40.50.
Kenya Airways eased 1.86% to close at 52.50 and traded a 50.00-54.00
range and 169,600 shares.
TPS Serena was marked 3.968% lower to close at 60.50 on 2,200 shares.
60.00 is somewhere it should bounce from.
CMC Holdings was marked down 2.21% to close at 13.25 and traded just
Cargen did not trade.
N.S.E Equities - Finance & Investment
Notwithstanding the Recent Volatility in Equity Bank, the Big Cap Bank
stocks are well supported on improved GDP Projections [the latest was
the OECD which upgraded their GDP Projection to 6% for East Africa]
and 1st Quarter Earnings 2010 which nearly all signalled a sharp
COOP Bank was the 2nd most active Counter and firmed 0.405% to close
at 12.45 a new all time High. COOP Bank traded a 12.20-12.65 range and
4.733m shares worth 59.117m. COOP Bank accelerated earnings in the 1st
Quarter 2010 and continues to respond positively.
COOP Bank share price data from www.rich.co.ke
Par Value: 1/-
Closing Price: 12.40
Total Shares Issued: 3,492,369,920
Market Capitalization: 43,305M
Equity Bank fell back a further 6.67% to close at 21.00. That is a
12.5% correction after a 30% 6 session move higher. Equity Bank traded
a 20.50-22.50 range and 2.314m shares worth 48.791m. Equity Bank has
acquired near enough 10m new Customers via its MPESA MKESHO
Partnership and I feel Folks have not properly valued this Ultra High
Frequency lower Denomination Model. Its all about Scale, the
complexity is the same.
Standard Chartered was unchanged at 224.00 and traded a 224.00-225.00
range and 37,600 shares worth 8.445m.
Barclays Bank was unchanged at 58.50 and traded a 58.00-59.00 range
and 119,300 shares.
KCB was unchanged at 20.75 and traded 320,700 shares. 19.00-24.00 has
been the trading Range for the longest time.
CFC Stanbic reversed course 5.44% to close at 69.50 and traded a wide
66.50-80.00 range. CFC Stanbic traded 56,100 shares and was overdue a
bout of Profit taking after a stellar run up of late.
DTB traded 1,300 shares at an unchanged 81.50.
HFCK eased 2.33% to close at 21.00 and traded 20,400 shares.
NBK eased 1.8525% to close at 39.75. NBK traded 7,900 shares.
NIC eased 0.68% to close at 36.50 and traded 71,900 shares.
Kenya Re firmed 5 cents to close at 12.05 and traded 112,800 shares.
Jubilee eased 0.585 to close at 170.00 and traded 3,000 shares.
PanAfric traded 18,500 shares at 60.00 and unchanged.
Centum retreated 5.00% to close at 18.00 and traded a 17.15-19.00
range and 93,100 shares.
Olympia Capital closed at 8.45.
N.S.E Equities - Industrial & Allied
KPLC came back 2.01% to close at 195.00 and traded a 190.00-200.00
range and 127,600 shares worth 25.004m. KPLC sit sin front of a
Balance Sheet Restructuring Exercise which will dilute Ordinary
Shareholders, the % Dilution is not yet known.
Kengen closed 0.5933% easier at 16.80 and traded a 16.25-17.00 range
and 1.003m shares worth 16.857m. Block Supply had not been visible for
some time until today.
Cables closed lower at 19.45 and traded 4,800 shares.
EABL closed at 176.00 +0.57% and traded a session high of 180.00
+2.85%. EABL has closed at a 2010 Closing High and traded 70,500
shares worth 12.424m. Demand outweighs Supply by a Factor of 3-1.
Mumias Sugar fell a further 3.935% to close at 12.20 and traded a
12.00-12.70 range and 579,000 shares. There is an overhang of 1m
shares showing on the Board.
Kenolkobil retreated a further 1.51% to close at 98.00 and traded a
95.00-100.00 range and 118,200 shares.
Total dipped 0.845% to close at 29.25 and traded 38,900 shares.
ARM closed at 130.00 [2 shillings off its all time closing High] and
traded a 130.00-132.00 range and 77,700 shares worth 10.176m.
Bamburi Cement traded a further 17,200 shares all at 200.00 and unchanged.
Portland did not trade.
BAT traded a 1,000 shares unchanged at 207.00.
BOC Kenya closed 2.92% easier at 133.00 and traded 3,700 shares.
Carbacid slipped 0.64% to close at 156.00 and traded 1,000 shares.
Crown Berger eased 25 cents to close at 34.25 and traded 1,400 shares.
Eveready dipped 2.27% to close at 4.30 and traded 37,000 shares.
Sameer fell 6.04% to close at 8.55 and traded 32,800 shares.
Unga closed lower at 11.45 and traded 43,500 shares.