|Friday 21st of August 2015
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IMPOSSIBLE IS NOTHING
“Impossible is just a big word thrown around by small men who find it
easier to live in the world they've been given than to explore the
power they have to change it. Impossible is not a fact. It's an
opinion. Impossible is not a declaration. It's a dare. Impossible is
potential. Impossible is temporary. Impossible is nothing.”
ANDREW KORYBKO HYBRID WARS: THE INDIRECT ADAPTIVE APPROACH TO REGIME CHANGE
Law & Politics
“Supreme excellence consists in breaking the enemy’s resistance
without fighting.” – Sun Tzu
Over two thousand years ago, the ancient Chinese military strategist
realized that indirect warfare is one of the most efficient ways of
fighting an enemy. It allows an opponent to defeat their adversary
without directly engaging them, thereby saving themselves the
resources that would have to be expended in a direct confrontation.
Attacking an enemy indirectly can also bog them down and put them on
the defensive, thereby making them vulnerable to other forms of
attack. It also carries with it a certain opportunity cost for the
defending side, since the time and resources that they spend in
dealing with the indirect attack could potentially have been put to
better use elsewhere. Besides the tactical advantages, there are also
strategic ones as well. There may be certain constraints (e.g.
alliances, military parity, etc.) that prevent one entity from
directly launching hostilities against another. In this case, indirect
warfare is the only option to destabilize the other.
The book focuses on the new strategy of indirect warfare that the US
has demonstrated during the Syrian and Ukrainian Crises. Both
situations left many wondering whether they were observing the export
of Color Revolutions to the Mideast, the arrival of the Arab Spring to
Europe, or perhaps some kind of Frankenstein hybrid.
This model begins by deploying a Color Revolution as a soft coup
attempt, only to be followed up by a hard coup Unconventional War if
the first plan fails. Unconventional Warfare is defined in this book
as any type of nonconventional (i.e. non-official military) force
engaged in largely asymmetrical combat against a traditional
adversary. Taken together in a two-pronged approach, Color Revolutions
and Unconventional Warfare represent the two components that form the
theory of Hybrid War, the new method of indirect warfare being waged
by the US.
“Psychological operations may become the dominant operational and
strategic weapon in the form of media/information intervention... A
major target will be the enemy population's support of its government
and the war. Television news may become a more powerful operational
weapon than armored divisions.”
I attempted to look into this when I presented at #Mindspeak in January
#MindSpeak with @alykhansatchu @InterConNairobi @YouTube 31st Jan 2015
Law & Politics
#Mindspeak, The Grandmaster Vladimir Putin, @BarackObama c21st Oil
Warfare Specialist, Crude Oil, Europe off balance, #Jesuischarlie
versus #BagaKillings, Adam Curtis, Andy Warhol, an Arrhythmic World,
#MH370, Kurkov, Ukraine, Images contaminate us, ISIS, Oil Warfare,
Iran, @HassanRouhani, #africarising, @Lagarde, The Mobile Phone, The
Street has a voice, Ouagadougou, Indian Ocean, Teflon Shilling,
The Guy in the Yellow T-shirt — long shorts, unruly black hair, thick dark glasses — arrived at the Erawan shrine in a tuk-tuk.
Law & Politics
No one may have noticed him; just another nondescript backpacker in
one of the busiest crossroads in Asia. He may have come to pay his
respects to the golden statue of Brahma at the center of the shrine –
and gaze on the Thai dancers and musicians in the background.
He sits on a bench. Then, slowly, he gets rid of a black backpack. He
stands up, checks his mobile. Then he walks away. Stops. Actually
seems to be calling someone on his mobile. Then he finally leaves
Erawan, hitting the crowded intersection, clutching a white plastic
bag, but always checking his phone.
He may – or may not – have known all his movements were being tracked
by multiple CCTV cameras. A few minutes after he disappears from their
sights, and allegedly takes a motorbike taxi, he enters, with a lethal
bang, the wilderness of mirrors that is contemporary Thailand.
Japan cautions China against frequent yuan manipulation
Caixin/Markit manufacturing index showed activity in China's factory
sector shrank at its fastest pace in almost 6 1/2 years in August as
domestic and export demand dwindled.
That, coming on the heels of weaker-than-expected data in July, stoked
fears of a slowdown in the world's second-biggest economy.
"Markets are pricing in the worst right now," said Herald Van Der
Linde, head of Asian equity strategy at HSBC. Particularly with
uncertainty about the Chinese currency, "people are saying this is
risk, and we step away from the market."
Shanghai stocks fell 1 percent to below the 200-day moving average for
the first time since July 2014. That brought losses for the week to
7.9 and pushed the S&P 500 .SPX to a six-month low overnight. The Hang
Seng index .HSI in Hong Kong was down 1.9 percent.
10 Currencies That May Follow Tenge in Tumble Triggered by China
Here’s a look at the currencies that are among those most at risk from
this conflux of global developments:
* Saudi Arabia’s riyal: Armed with $672 billion in foreign reserves,
Saudi Arabia, the world’s largest oil exporter, has enough capacity to
hold the peg, according to Deutsche Bank AG. Nonetheless, speculators
are betting on a break of the currency regime as crude oil tumbled to
a seven-year low. The forwards, contracts used by traders to bet on or
hedge against future price moves, fell to the weakest since 2003,
implying about a 1 percent decline in the riyal over the next 12
* Turkmenistan’s manat: This oil-exporting nation with close economic
ties to Russia devalued its currency by 19 percent in January.
Stockholm-based SEB AB forecasts a further weakening of as much as 20
percent in the next six months.
* Tajikistan’s somoni: The nation has close ties with Kazakhstan,
which accounts for about 11 percent of trade, and SEB expects a
depreciation of 10 to 20 percent.
* Armenia’s dram: The currency has lost 15 percent in the past 12
months, compared with a 46 percent drop in the ruble. A quarter of the
country’s trade is with Russia.
* Kyrgyzstan’s som: The weaker tenge will put pressure the som because
of this country’s ties to Kazakhstan, according to BMI Research.
* Egypt’s pound: The country has limited investors’ access to foreign
currencies amid a shortage since the 2011 Arab Spring protests.
Traders are betting the pound will weaken about 22 percent in a year,
according to 12-month non-deliverable forwards.
* Turkey’s lira: It’s one of the world’s worst-performing currencies
since China’s devaluation on Aug. 11. An escalation in political
violence and the probability of early elections compound the issues.
* Nigeria’s naira: Policy makers in this oil-exporting nation are
trying to hold the currency at a level most see as too high. Trading
in forwards indicates the currency will fall more than 20 percent
against the dollar over the next year.
* Ghana’s cedi: Also an oil exporter, though its main problems are
mainly fiscal imbalances, rising inflation and increasing debt.
* Zambia’s kwacha: The country is heavily exposed to China as copper
accounts for about 70 percent of exports.
* Malaysia’s ringgit: The currency slid to a 17-year low on Thursday
and foreign-exchange reserves fell below the $100 billion mark for the
first time since 2010.
Commodity Markets at a Glance WSJ
Gold 6 month INO 1162.34
Futures fell as much as 1.6 percent in New York, set for an eighth weekly drop.
The U.S. pumped crude in July at the fastest pace for the month since
at least 1920, the American Petroleum Institute reported Thursday. The
nation’s stockpiles are almost 100 million barrels above the five-year
seasonal average, weekly government data showed Wednesday.
Oil has slumped more than 30 percent since this year’s closing peak in
June amid speculation the global surplus will persist. Leading members
of the Organization of Petroleum Exporting Countries are maintaining
output, while Citigroup Inc. predicts crude may slide to as low as $32
a barrel, a level last seen during the world financial crisis.
“The extent of excess supply is not something that demand is going to
grow into in the near future,” Ric Spooner, a chief analyst at CMC
Markets in Sydney, said by phone. “If we’re going to avoid downward
pressure on prices, it’s going to have to come from production cuts.”
West Texas Intermediate for October delivery lost as much as 67 cents
to $40.65 a barrel on the New York Mercantile Exchange and was at
$40.79 at 1:43 p.m. Singapore time. The volume of all futures traded
was about 26 percent above the 100-day average. The September contract
expired Thursday after rising 34 cents to $41.14. Prices have
decreased 5.4 percent this week.
Dryness Threatens Ivorian Cocoa as Rain Brings ‘Minimal’ Relief
Showers forecast for coming days will bring “minimal relief” after
rainfall was 40 percent below normal from July 1 to Aug. 19, according
to MDA Weather Services and Speedwell Weather. Recent light rain
wasn’t enough to penetrate the soil and help beans to develop, said
Stanislas Koffi, head of the SCAT farmers’ cooperative in Tahe,
southwestern Ivory Coast.
“The current weather is making farmers worried,” said Bernard
Nguessan, who has been farming cocoa for 40 years in Gabiadji,
southwestern Ivory Coast. “We haven’t had rains. Cocoa leaves are dry
and we see few pods, about five or six, while last year we saw lots
because of good weather conditions.”
Cocoa, the third-biggest gainer in the Standard & Poor’s GSCI
commodity index this year, may extend its 4.1 percent gain if dry
weather persists through September, said Max Goettler, a trader at
Rotterdam-based Cocoanect BV. That may raise costs for chocolate
makers from Lindt & Spruengli AG to Barry Callebaut AG, the world’s
largest cocoa processor.
“There is upside risk in the market,” Goettler said by phone Aug. 11.
“You can’t switch to another commodity if you need cocoa. You either
use it or you don’t use anything.”
Nigeria Vows to Fight Speculators Betting on Naira Devaluation
“We haven’t seen any reason so far to institute a change in the
foreign-exchange policies,” Ugochukwu Okoroafor, a spokesman for the
Central Bank of Nigeria, said by phone from Abuja on Thursday. “The
preponderance of foreign currency in the country has led to
speculative attacks on the naira. People who have done it in the hope
we’ll devalue will be hurt.”
The naira’s exchange rate needs to strike a balance between Nigeria’s
dependence on oil for export earnings and the country’s need to import
most of its goods, Okoroafor said. The currency, which has remained
below 200 per dollar since mid-May, weakened 0.7 percent to 199.05 by
12:29 p.m. in Lagos. Six-month naira forwards jumped 2.6% to 235, the
highest since July 27.
“The volume of speculation on our currency is huge,” Okoroafor said.
Genuine demand for foreign exchange will be met by the central bank,
“but once it comes as a result of speculation, we’ll fight back,” he
Standard Chartered Bank Kenya reports H1 PAT 2015 -36% Earnings here
Par Value: 5/-
Closing Price: 266.00
Total Shares Issued: 309159514.00
Market Capitalization: 82,236,430,724
Standard Chartered reports H1 2015 Earnings here [versus H1 2014]
H1 Earnings Through 30th June 2015 vs. Through 30th June 2014
H1 Loans and Advances to Customers (Net) 123.256075b vs. 131.699706b -6.4%
H1 Total Assets 228.193508b vs. 228.719900b -0.23%
H1 Total Interest Income 10.791877b vs. 10.914887b -1.1%
H1 Total Interest Expenses [2.038838b] vs. [2.154853b] -5.4%
H1 Net Interest Income 8.753039b vs. 8.760034b -0.1%
H1 Other Income 365.788m vs. 1,840.248m -80.1%
H1 Total Non-Interest Income 3.434325b vs. 4.992609b -31.2%
H1 Total Operating Income 12.187364b vs. 13.752643b -11.4%
H1 Staff Costs 2.890505b vs. 2.583832b +11.9%
H1 Total Other Operating Expenses [6.594637b] vs. [5.664788b] +16.4%
H1 Profit Before Tax 5.592727b vs. 8.087855b -30.9%
H1 Profit After Tax 3.877266b vs. 6.060905b -36.0%
H1 EPS 12.54 vs. 19.60 -36.0%
StanChart was lapping 2014 results where they had booked Other Income
[property Sales] of 1.840b
This has distorted these results.
Its a Strong Franchise.
The Kenya Ports Authority plans to borrow 34 billion shillings ($328 million) to finance the expansion of East Africa’s biggest harbor on the southeast coast, Managing Director Gichiri Ndua said.
The state-run authority will begin construction in 2018 on the second
phase of a plan to enable the facility to handle more and bigger
ships, including Panamax vessels, Ndua said by phone Thursday from the
port city. Additions will include a 300-meter (984-foot) quay and
deepening the port by 15 meters, he said.
The expansion will enable the port to handle 450,000 more containers,
lifting overall capacity to “slightly above 2 million” 20-foot
equivalent units, or TEUs, when it’s completed in 2022, Ndua said. “We
will raise the money in soft loans from international development
partners,” he said, declining to provide further details on financing.
Kenya’s exports to Dar drop 30pc in first half of the year
Data from the Kenya National Bureau of Statistics (KNBS) shows that
the country sold goods worth Sh12.2 billion to Tanzania in the six
months to June, down from Sh17.7 billion in a similar period last
The loss is partly linked to industrialisation in Tanzania and the Dar
and Kampala currencies making worse losses against the dollar compared
to the Kenya shilling.
Kenya Shilling versus The Dollar Live ForexPros 103.45
Nairobi All Share Bloomberg -7.655% 2015 [All Share sits +3.15% above
its 2015 Closing Low reached on the 5th of this month]
150.42 -0.59 -0.39%
Nairobi ^NSE20 Bloomberg -13.35% 2015 [NSE20 Index sits +2.61% above
its 2015 closing Low reached on the 5th of this month]
4,429.87 -34.87 -0.78%
Every Listed Share can be interrogated here
The Nairobi All Share retreated 0.50% to close the week at 149.66.
The Nairobi NSE20 Index eased back 24.58 points to close at 4405.29.
Equity Turnover maintained its up beat tempo and clocked 2.073b versus
3.686b on Thursday.
Equity Group has been the determinant behind the high volume action
over the last 2 sessions and has traded 3.204% of its shares Thursday
N.S.E Equities - Commercial & Services
The On-Line Front Page of the Business Daily leads
''The Communications Authority of Kenya (CA) has beaten a retreat on a
contentious law that would have automatically declared Safaricom a
dominant player subject to sanctions, saying it will first hire an
international firm to analyse the telecommunications and broadcasting
You will recall my comment yesterday ''markets began discounting the
M-Pesa hullabaloo as plain untenable''
Safaricom which had rallied +8.633% since 6th August closing
encountered Profit taking as it had already priced in such an outcome.
Safaricom eased 0.66% to close at 15.00 and traded 7.97m shares.
@Safaricomltd share price data here
TPS Serena rallied +4.62% to close at 34.00 and traded 1,200 shares.
News Flow around Tourism is improving but Serena's MD spoke of a
Recovery next year. However, this is a bombed out price and continued
better news flow can lift it quickly to 40.00.
Uchumi announced they had head hunted Mr. King’ara from Naivas to be
its Chief Operating officer. Uchumi had 5 Buyers for every Seller and
the sell-side supply looked very challenged. Uchumi ticked +0.67%
higher to close at 7.50 on just 10,800 shares worth of business.
N.S.E Equities - Finance & Investment
Standard Chartered reported First Half Earnings for 2015 before the
Opening Bell. StanChart reported that Total Assets declined -0.23% to
228.19b and First Half Profit before Tax declined -30.9%. StanChart
was lapping H1 2014 Earnings where they had booked 1.840b in Other
Income. H1 2015 Other Income declined 80.1% to 365.788m. That
Non-Repeat has distorted these results some.
StanChart is a Strong Franchise and any price retreat should be short
lived. StanChart eased back 3.38% to close at 257.00 on light trading
of just 2,600 shares confirming sell-side pressure was light and low
volume. StanChart shares are tightly held and I expect Investors to
look through these numbers in due course.
Equity Group was the most actively share for the 2nd consecutive
session and closed unchanged at 40.00 and traded 36.755m shares worth
1.47b shillings. Equity has traded 118,651,800 shares and that equates
to 3.204% of its Equity over two trading sessions.
Equity Group share price data here [Use 5m volume chart] -20.00% in 2015
Kenya Commercial Bank closed 1.08% easier at 46.00 and traded 3.644m
shares worth 167.709m.
N.S.E Equities - Industrial & Allied
BAT rebounded +6.28% to close at 829.00 and traded 127,400 shares
worth 105.707m. BAT reported a +8.25% H1 2015 Profit after Tax
acceleration and mentioned ''the benefit of foreign exchange movements
arising from export sales'' which is counter trend as most Companies
have been challenged by the weaker Shilling. BAT was the biggest
Winner at the Securities Exchange today.
Mumias Sugar firmed 2.7% to close at 1.90 and traded shares as high as
2.00 +8.108% during the session. This is a resilient performance when
you consider they issued a FY Profits Warning 18th August. The
negative news might well have already been baked into the Price.
18-AUG-2015 Mumias Sugar Profits Warning Announcement