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Satchu's Rich Wrap-Up
 
 
Wednesday 28th of January 2015
 
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MAJOR MOVES IN THE EAST AFRICA MARKETS Mon, 26 Jan 2015 07:46:51 GMT
@cnbcafrica Video
http://www.cnbcafrica.com/video/?bctid=4012079663001

Macro Thoughts

Home Thoughts

read more



"Women hold up half the sky." -- Mao Tse-tung
Africa


I should know living in a completely female household [Wife, Daughters
and Sahara the Golden Retriever].

"It's always darkest before it becomes totally black." -- Mao Tse-tung

read more




A man walks past screens displaying a television news programme showing an image of Kenji Goto, one of two Japanese citizens taken captive by Islamic State January 25, 2015 @Reuters
Law & Politics


"In societies reduced to blur and glut, terror is the only meaningful
act. There's too much everything, more things and messages and
meanings that we can use in ten thousand lifetimes. Inertia-hysteria.
Is history possible? Is anyone serious? Who do we take serious? Only
the lethal believer, the person who kills and dies for faith.
Everything else is absorbed. The artist is absorbed, the madman in the
street is absorbed an processed and incorporated. Give him a dollar,
put him in a TV commercial. Only the terrorists stand outside. The
culture hasn't figured out how to assimilate him. It's confusing when
they kill the innocent. But this is precisely the language of being
noticed, the only language the West understands. The way they
determine how we see them. The way they dominate the rush of endless
streaming images."
-- Don DeLillo, Mao II

read more


Ebola crisis: World 'dangerously unprepared' for future pandemics
Law & Politics


The president of the World Bank has warned that the world is
"dangerously unprepared" for future deadly pandemics like the Ebola
outbreak in West Africa.

Jim Yong Kim, speaking in Washington, said it was vital that
governments, corporations, aid agencies and insurance companies worked
together to prepare for future outbreaks.

Conclusions

"The single biggest threat to man's continued dominance on this planet
is the virus," the Nobel Prize-winning biologist Joshua Lederberg once
wrote.
http://www.newyorker.com/news/daily-comment/whats-ebola

read more







ARRIVAL IN RIYADH. PHOTOGRAPHER: SAUL LOEB/AFP/GETTY IMAGES
Law & Politics


On January 23, the Financial Times headlined "Russian banker warns
west over Swift."

http://www.globalresearch.ca/putins-message-to-obama-on-ukraine/5427517

Addressing Davos Economic Forum participants. Calling exclusion from
the international banking payment system tantamount to "war."

"Russia's banks rely heavily on the Belgium-based payments system for
both domestic and international payments," said the FT.

One "advisor" calls excluding them "the nuclear option." VTB is
Russia's second largest bank.

CEO Andrei Kostin was blunt saying "(i)f there is no Swift, there is
no banking...relationship."

"It means that the countries are on the verge of war, or they are
definitely in a cold war."

"The next day, the Russian and American ambassadors would have to
leave the capitals."

read more


Defeating Islamic State Means a Deal With Assad @BV [should have been obvious from 2011]
Law & Politics


The Kurdish flags now fluttering over Kobani after four months of
fighting demonstrate that Islamic State can be beaten on the
battlefield in Syria. Plentiful U.S. air power -- some 750 airstrikes
-- combined with determined allies on the ground can get the job done.

That's less encouraging than it might be, though, and not just because
success in Kobani will be hard to replicate elsewhere. To truly end
the fighting in Syria and defeat Islamic State, the U.S. and its
allies will have to undertake the distasteful but necessary task of
negotiating with Syrian president and war criminal Bashar al-Assad.

Conclusions


This conclusion should have been made in 2011.

read more



Currency Markets at a Glance WSJ
World Currencies


Euro 1.1369 The euro traded at $1.1340 EUR=, having risen to $1.1423
on Tuesday, extending its rebound from an 11-year low of $1.1098 hit
on Monday.
Dollar Index 94.14
Japan Yen 118.04
Swiss Franc 0.9051
Pound 1.5186
Aussie 0.8002
India Rupee 61.383
South Korea Won 1084.60
Brazil Real 2.5724
Egypt Pound 7.4395
South Africa Rand 11.5613

Dollar Index 3 Month Chart INO 94.14 [100,00 Target]

http://quotes.ino.com/charting/index.html?s=NYBOT_DX&v=d3&t=c&a=50&w=1

The dollar index .DXY posted its biggest fall since early October on
Tuesday to 94.10, slipping further from the 11-year high of 95.481 hit
on Friday.

Euro versus the Dollar 3 Month Chart 1.1369 [Target 1.0000]

http://quotes.ino.com/charting/index.html?s=FOREX_EURUSD&v=d3&t=c&a=50&w=1

read more




@IMFNews's @Lagarde warns African economies of headwinds from China, U.S
Africa


Lagarde called for "vigilance" across Africa and added this slower
growth has implications for a continent that is now more integrated
into the global economy than ever before.

"Momentum is slowing in many advanced and emerging economies,
including China -- one of Africa's main trading partners,"
Lagarde told
Rwandan lawmakers in the capital Kigali.

Lagarde said the overall outlook for sub-Saharan Africa was promising
at close to 5 percent, but growth forecasts for the region have been
trimmed due to lower oil and commodity prices.

African countries such as Nigeria and South Sudan depend on oil for
the majority of their revenues.

Lagarde said some African oil exporters will struggle in case oil
prices remain low and warned of instability once the United States
starts imminent "monetary policy normalization",
a move that is
expected to see the U.S. raise interest rates.

"Even if this process is well-managed and well-communicated - and I
believe that it has been and will be - there could be negative effects
for emerging markets and global financial stability. African economies
could also be impacted," she said.

read more



Surge in dollar-debt leaves some African nations exposed- think tank
Africa


A surge in foreign debt issuance by African nations has left some
fragile economies exposed to the risk of billions of dollars in
foreign exchange related losses if the U.S. currency strengthens
abruptly, a think-tank said on Wednesday.

Judith Tyson, senior researcher at the Overseas Development Institute
(ODI), said the notional losses in terms of higher interest and
capital repayments could total $11 billion in the event of a slump of
35 percent in African currencies against the dollar.


Ivory Coast would be most exposed, risking losses equivalent to some
11 percent of its GDP, due to its high debt and long maturities, the
report said.

Seychelles could face losses equivalent to 6.5 percent of its gross
domestic product (GDP), with Gabon and Senegal faces possible losses
of around 4 percent, she said.

The CFA currency of Ivory Coast, Senegal and Gabon is pegged against the euro.

"We are calling for caution," Tyson said, urging investors and
governments to be responsible with debt issuance in the face of weaker
commodity prices and slowing growth prospects.

"Sub-Saharan Africa has the potential to repeat the problems which
occurred in the early 1990s in Asia and Latin America, when damaging
financial crisis pushed millions back into poverty for a decade," her
report said.

Foreign debt issues for sub-Saharan Africa last year exceeded $6.25
billion, bringing the stock of debt to over $18 billion. That remains
small relative to regional GDP measured by the World Bank at more than
$1.6 trillion.

But some countries are more exposed after heavy issuance in 2014.
Ghana's overall debt to GDP rate is 65 percent of GDP, while Senegal
and Mozambique both have more than 50 percent, according to the World
Bank.

The normalising of Western interest rates risked sucking capital from
African markets, further weakening African currencies and plunging
them into an economic downturn, the report said.

Tyson said that irresponsible use of debt by some countries was adding
to the problem, as many raised on international markets had not been
used for investment that would boost future economic growth.

She said Mozambique had borrowed $850 million for its national fishing
industry but instead spent the money on military boats and equipment.
Ghana had also spent heavily on hefty public sector pay increases,
resulting in a wide fiscal deficit, prompting it to open talks on an
IMF programme.

read more


Sudan's Omar al-Bashir gets Chinese-built presidential palace @BBC
Africa


But the Chinese have just built the president a vast new palace right
next door and 26 January is its grand official opening - the date is
unlikely to be a coincidence.

The Chinese have form in such matters.

In recent years they have built similar structures in Angola, Burundi,
Guinea-Bissau, Lesotho, Malawi, Mozambique, Sierra Leone and Togo. The
list could go on.

You could call it soft diplomacy, or perhaps concrete diplomacy.

read more


South Africa All Share Bloomberg +1.97% 2015
Africa


50,711.09 +373.11 +0.74%

Dollar versus Rand 6 Month Chart INO 11.5562

http://quotes.ino.com/charting/index.html?s=FOREX_USDZAR&v=d6&t=c&a=50&w=1

Egypt Pound versus The Dollar 3 Month Chart INO 7.4426

http://quotes.ino.com/charting/index.html?s=FOREX_USDEGP&v=d3&t=c&a=50&w=1

Egypt EGX30 Bloomberg +11.47% 2015

http://www.bloomberg.com/quote/CASE:IND

9,946.58 +111.77 +1.14%

read more


Nigeria will not delay elections: commission
Africa


The head of Nigeria's electoral commission said on Tuesday the country
will hold a presidential election as scheduled on Feb. 14, rejecting a
call from one of the president's advisors to delay them.

"We remain committed to implementing the timetable," commission head
Attahiru Jega told a news conference.

The elections will be the first where Nigeria's 68.8 million voters
must have a biometric cards, a measure introduced to guard against
fraud that has plagued past polls.

But delays in getting the cards out to voters -- there is no
functioning postal service in Nigeria -- have cast doubts over whether
the deadline can be met.

"There are systemic challenges affecting distribution. Nigeria is not
a country where you can mail cards...there is no guarantee it will
reach its destination," Jega said.


Chairman of Independent National Electoral Commission (INEC) Attahiru
Jega speaks at a news conference in Nigeria's capital Abuja April 7,
2011.

http://www.reuters.com/article/2015/01/27/us-nigeria-election-idUSKBN0L02BQ20150127

Nigeria All Share Bloomberg -13.84% 2015

http://www.bloomberg.com/quote/NGSEINDX:IND

read more


Nigeria May Stop Foreign-Currency Sales for Local-Goods Imports
Africa


Nigeria's central bank is considering halting sales of dollars to
import goods that are already manufactured in the country as it seeks
to reduce pressure on the local currency hit by a drop in oil prices.

"The only thing that will reduce pressure on our currency is by
producing those things we are importing today," Central Bank of
Nigeria Governor Godwin Emefiele said at a conference on Tuesday in
Lagos, the commercial capital. "We will try as much as possible not to
hurt your business, but we need to be able to work together."

The naira has slumped 16 percent against the dollar on the interbank
market in the past six months, the most among 24 African countries
tracked by Bloomberg. It traded at 192.45 at of 12:43 p.m. in Lagos,
its lowest on record.

Emefiele reiterated that the central bank has no plans to further
devalue the currency.

"We continue to take all measures to defend the currency at the
current exchange rate," he said in an interview with Bloomberg TV
Africa.

read more


Ghana Stock Exchange Composite Index Bloomberg -4.29% 2015
Africa


White Farmers to Meet Zimbabwe Government Over Land Seizures

http://www.bloomberg.com/news/2015-01-27/white-farmers-to-meet-zimbabwe-government-over-land-seizures.html

Zimbabwe's Commercial Farmers' Union, which represents mainly white
farmers, will meet with Lands and Resettlement Minister Douglas
Mombeshora to discuss the government's plans to evict whites still
growing crops.

"We've managed to secure a meeting with Minister Mombeshora tomorrow
to seek clarification on whether government still wants us to farm in
the country," CFU Director Hendrik Olivier said in an interview in the
capital, Harare, on Tuesday. Mombeshora confirmed the planned meeting
when contacted by phone.

The government on Jan. 22 gave white crop farmers 90 days to leave
their land. It gave an exemption to dairy farmers and livestock
breeders. About 300 white farmers remain on their properties after the
often violent evictions of about 3,500 growers between 2000 and 2008.

read more


Abandoned sandals in the bush in Burundi (January 2015) @BBC
Africa


Abandoned clothing and footwear was found near the site of an alleged mass grave

read more


26-JAN-2015 Kenyan Asset Markets have been Displaying a lot of Alpha
Kenyan Economy


As an importer of petroleum, the sharply reduced price will provide a
significant stimulus to our economy. It is very 'grassroots' because
everyone buys fuel. This, combined with lower food prices [oil is a
leader in this regard], will juice the economy meaningfully.

The Jubilee government will owe a big vote of thanks to US President
Barrack Obama, the 21st century oil war specialist, for wrestling the
price below $50 a barrel because these are exactly the right
ingredients for creating the 'feel-good' factor.

Money sent home by Kenyans living abroad rose 10.68 percent last year
to $1.43 billion, the central bank said on Tuesday, setting a new
annual record

http://af.reuters.com/article/investingNews/idAFKBN0L018O20150127

Kenya Shilling versus The Dollar Live ForexPros 91.763

http://j.mp/5jDOot

Nairobi All Share Bloomberg +1.80% 2015

http://www.BLOOMBERG.COM/quote/NSEASI:IND

165.82 +0.21 +0.13%

Nairobi ^NSE20 Bloomberg +1.90% 2015

http://j.mp/ajuMHJ

5,209.84 -8.04 -0.15%

Every Listed Share can be interrogated here

http://www.rich.co.ke/rcdata/nsestocks.php

read more




EABL is +2.72% in 2015 share price data
Kenyan Economy


EABL is in  a closed period ahead of a February Earnings release. I
feel these are Optimal Entry Levels and I have a Price Target of 400
this year.

read more


UAP second most valued insurer on Old Mutual deal
Kenyan Economy

 


The sale of stakes in UAP Holdings to Old Mutual by key shareholders
has valued the over-the-counter (OTC) stock at Sh38 billion, nominally
catapulting it to second after Britam.

Britam is the most valued among the listed insurance firms with a
market capitalisation of Sh57.66 billion at a share price of Sh29.75.

Jubilee Holdings is next with a valuation of Sh27.5 billion at Sh459
per share, followed by CIC Insurance which is valued at Sh26 billion
at a share price of Sh9.95. Liberty Holdings, Kenya Re and Pan Africa
Insurance are valued at Sh12.45 billion, Sh12.21 billion and Sh11
billion respectively.

In terms of assets though Jubilee led the listed firms in the half
year to June 2014 at Sh68.9 billion, followed by Britam at Sh55.15
billion and Liberty at Sh31.8 billion. Kenya Re assets stood at Sh29.8
billion, those of Pan Africa at Sh22.9 billion and CIC at Sh16.6
billion.

UAP assets at the end of 2013 stood at Sh33.1 billion. Its share was
priced at Sh86 on the OTC just six months ago, meaning it has doubled
going by the latest buyout.

 

read more



 
 
N.S.E Today


The Nairobi All Share edged up 0.06 points and traded the highest
volume session of the year with 924.059m worth of business transacted
today.
The Nairobi NSE20 Index shaved off 6.45 points to close at 5207.04.
The Nairobi Securities Exchange whilst under performing  Egypt which
is up over 10% in January, has put in a very commendable low beta
performance in january.



N.S.E Equities - Agricultural


Limuru Tea [which given the situation of the Tea estate right on the
outskirts of Nairobi] is in fact a Real Estate Play now was high
ticked by the daily maximum to close +9.83% at 1,017.00. Limuru Tea is
+31.9066% in 2015.

Limuru Tea share price data here +31.9066% 2015

http://www.rich.co.ke/rcdata/company.php?i=NTA%3D

Eaagads bumped 9.46% higher to close at 41.00.



N.S.E Equities - Commercial & Services


Safaricom firmed 0.37% to close at 14.15 and traded 8.606m shares
worth 122.083m. Buyers outpaced Sellers by a Factor of 4.5 to 1 and
There are surely even more Buyers below the radar at +0.7117% in 2015
and 5.666% below a Record Closing High of 15.00.

.@Safaricomltd share price data here +0.7117% 2015

http://www.rich.co.ke/rcdata/company.php?i=NTU%3D

Uchumi rallied +2.36% to close at 13.00 which is a more than 6 month
High. Todays trading volume was meaningful with 5.247m shares worth
68.210m. Uchumi has surged +29.35% in 2015 as Investors flip from
being egregiously bearish [during the Rights issue when shares traded
at a 10% discount to the Rights Price of 9.00] to believing that
having bagged the Rights proceeds, Jonathan Ciano Esquire has a
serious shot at entrenching Uchumi's Footprint.

Kenya Airways which had rallied +24.71% in 2015 through this morning
shaved off 0.46% to close at 10.80. Strong Buy Side Interest is
clustered at 10.30+ and Kenya Airways is catching up with a world-wide
Airline stock Rally [which rally was inversely correlated to Oil
Prices, naturally]

Car and General rallied +6.0606% to close at 52.50.



N.S.E Equities - Finance & Investment


Kenya Commercial Bank was the most actively traded share at the
Securities Exchange and firmed 0.862% to close at 58.50 and was
trading session highs of 59.50 +2.59% at the Finish Line, which is
just 0.8333% off an All-Time Closing High from August 2014. KCB traded
3.765m shares worth 222.055m.

.@KCBGroup share price data +2.6315% in 2015

http://www.rich.co.ke/rcdata/company.php?i=MjE%3D

Equity Group corrected 0.925% off a 2015 high to close at 53.50 and
traded 2.310m shares worth 124.547m. Equity Group has rallied 7% in
2015.

Standard Chartered firmed 0.29% to close at 342.00 and traded 108,300
shares worth 37.139m. Standard Chartered is +2.0895% in 2015 and has
plenty of head room in the Price. I would have thought the shares get
split in 2015 making it more affordable for Retail Investors.

NIC Bank ticked 1.48% lower to close at 65.50 and traded 829,000
shares. NIC Bank is +13.91% in a strong start to 2015.

NIC Bank share price data here +13.91% 2015

http://www.rich.co.ke/rcdata/company.php?i=MjM%3D

Old Mutual PLC's blitzkrieg move on UAP Holdings where they have now
reached a 60.7% holding spending $253m has captured the attention. The
sector has been red-hot for a while with M&A Action confirming.

BRITAM EA holds the prize for the highest-capitalisation Insurance
stock and eased back 2.6086% today to close at 28.00 and traded a good
slug of shares 1.575m to be exact.



N.S.E Equities - Industrial & Allied


EABL ticked 0.37% easier to close at 314.00 and traded 218,900 shares
worth 68.872m. I expect a better than consensus estimates Earnings
Release in February and meaningful rally in the share price with a
Year End Objective of 400.00+.

KenolKobil rallied +3.804% to close at 9.55 and traded heavy volume of
5.964m shares worth 57.201m. KenolKobil has surged +9.77% in 2015.
Total Kenya closed unchanged at 26.50 on light volume. Total Kenya is
+10.41% in 2015.
Both Rallies are informed by the view that the @ERC_Kenya has been
slow to transmit the Fall in the price of Fuel and therefore, the
Operators might well have made some ''supernormal'' returns.

Mumias Sugar eased 1.72% to close at 2.90 nut has ramped +48.71%
higher in 2015 and is therefore, the best performing stock at the
@NSEKenya in 2015.

Transcentury spiked 8.47% to close at 19.85 and traded 8,000 shares.



by Aly Khan Satchu (www.rich.co.ke)
 
 
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January 2015
 
 
 
 
 
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