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Satchu's Rich Wrap-Up
 
 
Thursday 07th of January 2016
 
Morning
Africa

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Macro Thoughts

read more




29 SEP 14 ::A Small Window for Sharks as Dollar Rises @TheStarKenya
Africa


The dollar has had lift-off against the yen, reaching 109.46 on
September 19, the highest level since August 2008. Commodity
currencies have been getting creamed. The rand has sliced through
11.00 and was last at 11.22 against the dollar. The Brazil real has
retreated 7.4 per cent over the last four weeks. Gold was last trading
at $1,214 and could seriously crash and burn.

The point I am making is that the dollar has just started going. There
will be blood in the water. There is a small window if we want to be
the sharks.

Home Thoughts

read more


With Ngugi Wa Thiongo's Dreams in a Time of a War
Africa


Years later when I read T.S. Eliot's line that April was the cruellest
month, I would recall what happened to me one April Day in 1954, in
chilly Limuru, the prime Estate of what, in 1902, another Eliot, Sir
Charles Eliot, then Governor of colonial Kenya, had set aside as White
Highlands. The Day came back to me, the now of it, vividly.

read more


The Waste Land TS Eliot
Africa


THE BURIAL OF THE DEAD

APRIL is the cruellest month, breeding
Lilacs out of the dead land, mixing
Memory and desire, stirring
Dull roots with spring rain.

read more


Pluto’s haze layer, backlit by the sun.CREDITCOURTESY NASA / JHUAPL / SWRI
Africa


NASA’s New Horizons spacecraft concluded its tightly choreographed
flyby of Pluto, back in July, with a pirouette, pointing its antenna
toward Earth. Five hours later, the anxious team at mission control,
in Maryland, received the first handful of images. Pluto, still
smarting from its demotion to dwarf planet, nonetheless revealed
itself to be a complex world, with a polar ice cap, rugged mountains,
smooth plains, and reddish patches that recalled the surface of Mars.
And then, just as the New Horizons scientists began their feverish
speculation—Might the smoothness be the result of ongoing geological
processes? Could the reddish patches be the organic material nicknamed
“star tar,” a precursor to life?—the spacecraft fell silent again. For
the next three weeks New Horizons carried out a series of planned
observations, looking back at Pluto and its moons, pausing only
occasionally to send home low-bandwidth information about the solar
wind and space dust that it was encountering. Ninety-five per cent of
the information that it had gathered during the flyby, including most
of the high-resolution imagery, remained tantalizingly out of reach,
trapped aboard the spacecraft’s digital recorders.

read more



"Either way, it means Pyongyang has advanced its nuclear game," Li said.
Law & Politics


"North Korea has been working on the militarization of its nuclear
warheads for many years. The test marked their latest step."

read more



29-11-2010 FAR away in distant lands lies the Hermit Kingdom They all have had tiny little hands like the Elves in the Elves and the Shoemaker.
Africa


And this country has nuclear weapons and on its border with its
neighbour South Korea sit 25,000 American soldiers.

read more


Tashfeen Malik, (L), and Syed Farook are pictured passing through Chicago's O'Hare International Airport in this July 27, 2014
Law & Politics


But that timeline contains an 18-minute gap beginning at 12:59 p.m.
(2059 GMT) during which the husband and wife were not captured on any
surveillance cameras or spotted by witnesses, leaving open the
possibility that they visited a storage unit, residence or business.

read more





Chinese stock exchanges closed early for the second time this week after the CSI 300 Index plunged more than 7 percent.
Law & Politics


Trading of shares and index futures was halted by automatic circuit
breakers from about 9:59 a.m. local time. Stocks fell after China’s
central bank weakened the currency’s daily reference rate by the most
since August.

“The yuan’s depreciation has exceeded investors’ expectations,” said
Wang Zheng, Shanghai-based chief investment officer at Jingxi
Investment Management Co. “Investors are getting spooked by the
declines, which will spur capital outflows.”

Under the mechanism which became effective Monday, a move of 5 percent
in the CSI 300 triggers a 15-minute halt for stocks, options and index
futures, while a move of 7 percent close the market for the rest of
the day. The CSI 300 of companies listed in Shanghai and Shenzhen fell
as much as 7.2 percent before trading was suspended.

Chinese stocks in Hong Kong, which doesn’t have circuit breakers,
slumped 4.4 percent. The offshore yuan fell to a five-year low before
erasing losses.

read more







24 AUG 15 China Roils The Markets @TheStarKenya
Law & Politics


“It’s totally premature to speak of a crisis in China,” a senior IMF
Official told a press conference.

In my experience, when policy makers make these kind of pro-
nouncements, it is exactly because there is a crisis.

“At the moment none of us can read China,” said the CEO of Glencore. I
can and it is going to get a lot worse, I am afraid.

The further problem is that no one believes the data either. This
moment when the market stops suspending its disbelief is seriously a
dangerous one for policy makers.

read more


Currency Markets at a Glance WSJ
World Currencies


Euro 1.0795
Dollar Index 99.03
Japan Yen 118.13
Swiss Franc 1.0037
Pound 1.4612
Aussie 0.7052
India Rupee 66.825
South Korea Won 1197.09
Brazil Real 4.0295
Egypt Pound 7.8299
South Africa Rand 15.9328

read more




Spot prices for the Western Canadian Select grade fell to $19.81 a barrel on Wednesday, the lowest since tracking began in 2008, according to data compiled by Bloomberg.
World Currencies


Maya crude, a heavy grade from Mexico, sank to $25.55 a barrel
Wednesday, the lowest since 2004. West Texas Intermediate, the U.S.
benchmark, tumbled to the lowest close in seven years, at $33.97.
Brent, the European gauge, dropped to its lowest settlement since 2004
at $34.23.

read more






10-AUG-2015 “The end is nigh’’ for crude oil and oil producers from Caracas to Luanda, from Riyadh to Abuja
Commodities


Oil is now in free fall. The end is nigh for the oil based, rentier
economies. President Obama, first Kenyan-American president of the
United States and oil warfare specialist, has scored the equivalent of
a hat-trick at the World Cup in how he has advanced the US national
interest by using the price of oil as a geopolitical spear. Oil based
economies are going to contract, currencies which have already
collapsed are going to be routed and Greek- style austerity will be
the order of the day. The melt-down is coming.

read more



Gold 6 month INO 1100.00 [Catching an Insecurity/Geopolitical Risk Premium]
Commodities


Why 2015's Best Commodity Could Turn Into This Year's Nightmare

http://www.bloomberg.com/news/articles/2016-01-05/why-2015-s-best-commodity-could-turn-into-this-year-s-nightmare

Last year’s best-performing commodity is poised to become the market’s
worst nightmare.

After the longest rally in London cocoa futures since at least 1989,
farmers from Ivory Coast to Peru are preparing to revive supplies in
the 2016-17 season that starts in October, creating a surplus that
Rabobank International says will be the largest in six years. With
demand slowing, the bank is most bearish about prices for the
chocolate ingredient this year among the dozen agricultural
commodities it tracks.

Prices surged 60 percent during a four-year rally through 2015,
forcing candy makers from Hershey Co. to Lindt & Spruengli AG to
charge more for their products. Last year, El Nino weather patterns
left dry conditions that hurt cocoa crops, including in West Africa,
which produces about 70 percent of the world’s beans. London futures
in December reached 2,332 pounds ($3,423) a metric ton, the most since
2011, when a civil war disrupted exports from Ivory Coast, the top
supplier.

“We expect these very good international prices to incentivize
production,” said Carlos Mera, an analyst at Rabobank in London. “We
don’t think these levels are justified given the political stability
in West Africa.”

Cocoa was an anomaly last year, rising 14 percent in London, when
almost every other major commodity tumbled. The gain was the biggest
of the 24 commodities tracked by the Standard & Poor’s GSCI Spot
Index, which slid more than 25 percent. Rabobank says cocoa futures in
London may slide to 1,800 pounds by the fourth quarter, down 17
percent from Tuesday’s close at 2,163 pounds.

After a production deficit of about 150,000 tons in the 2015-16 season
that started in October, the world will soon have more supply than it
needs. Output will exceed demand by 93,000 tons in the 2016-17 season,
according to Rabobank. That would be the biggest glut since 2010-11.

Emerging Markets

Frontier Markets

read more


Djibouti Coalition Party Backs Guelleh as President, Nation Says
Africa


Djibouti’s Social Democratic People’s Party, a member of the Horn of
Africa nation’s governing coalition, backed President Ismael Omar
Guelleh to extend his 17-year rule of the country, La Nation reported.

Members of the Union for a Presidential Majority coalition will meet
in the coming days to select their candidate for the elections, which
are scheduled to take place April 8, the state-owned newspaper said.
Guelleh, 68, announced his bid to seek re-election last month after
about 120,000 marched in the capital in support of his candidacy, it
said.

Guelleh has led Djibouti since 1999. He succeeded his uncle Hassan
Gouled Aptidon, who was the country’s first president after it gained
independence from France in 1977. In March 2010, Guelleh amended the
constitution to allow him to extend his rule by two more six-year
terms. At his swearing in after elections in 2011, Guelleh said he was
taking his oath of office for the “third and final time.”


Conclusions

read more




Dollar versus Rand 1 Year Chart INO 16.0002 [Target 20.00]
Africa


It had fallen to 16.0050 earlier in the session, close to the all-time
low of 16.0485, reached in mid-December after President Jacob Zuma
fired finance minister Nhlanhla Nene.

read more



Lagarde tells Nigerian lawmakers IMF she does not back FX curbs Reuters
Africa


"Additional exchange rate flexibility, either up or down, can help
soften the impact of external shocks, make output and employment less
volatile, and help build external reserves," said Lagarde.

"It can also help avoid the need for costly foreign exchange
restrictions, which we don't really support, and if they exist they
should remain temporary by nature," she added.

Conclusions


Marvellous Lady - look at how she is finessing the Devaluation for the
Nigerian President

read more


Pressure Mounts for Nigeria Naira Devaluation on Oil Plunge
Africa


The Central Bank of Nigeria may revise its target for the naira by
about 20 percent to 240 to 250 per dollar as oil continues its
decline, Alan Cameron, London-based economist at Exotix Partners LLP,
said in a research note. The currency was little changed at 199.29 per
dollar at 8:05 a.m. Thursday in Lagos, the commercial capital.

read more




Rising demand spurs Kenyan firms’ growth to 7-month high, survey shows
Kenyan Economy


“The private sector closed the year on a strong note as the PMI rose
to an eight-month high of 55.5 from 53.7 in the previous month and a
survey-record low of 51.7 in October,” said CfC Stanbic economist
Jibran Qureishi.

“Despite the ongoing challenges in the tourism sector for the most
part of 2015 and erratic weather patterns that suppressed agricultural
production in the first half of the year, the Kenyan private sector
has weathered the storm in what we think was an incredibly challenging
global environment in 2015,” he said.

Conclusions

The Economy is going to surprise to the Upside in 2016

read more


Uchumi grapples with Uganda bankruptcy suit
Kenyan Economy


Retail chain Uchumi has filed for bankruptcy in Uganda.

Conclusions

Probably the best option in order to ring-fence Uganda.

read more


Uchumi share price data here
Kenyan Economy


Par Value:                  5/-
Closing Price:           10.00
Total Shares Issued:          364959616.00
Market Capitalization:        3,649,596,160
EPS:             -10.85
PE:                 -0.922

read more


Kenya Shilling versus The Dollar Live ForexPros 102.235 [seriously TEFLON]
Kenyan Economy


Nairobi All Share Bloomberg +0.76% 2015

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

146.81 +1.32 +0.91%

Nairobi ^NSE20 Bloomberg -0.80% 2015 [Back above 4,000.00]

http://j.mp/ajuMHJ

4,008.53 +33.95 +0.85%

read more




 
 
N.S.E Today


Chinese stock exchanges closed early for the second time this week
after the CSI 300 Index plunged more than 7 percent. Trading of shares
and index futures was halted by automatic circuit breakers from about
9:59 a.m. local time. Stocks fell after China’s central bank weakened
the currency’s daily reference rate by the most since August.
Under the mechanism which became effective Monday, a move of 5 percent
in the CSI 300 triggers a 15-minute halt for stocks, options and index
futures, while a move of 7 percent close the market for the rest of
the day. The CSI 300 of companies listed in Shanghai and Shenzhen fell
as much as 7.2 percent before trading was suspended.
As I said on 06-JUL-2015 The Stock market crash represents probably
the biggest political risk to the ‘’neo-totalitarian’’ [great
description via Quartz] Xi Jinping.
On 24th August 2015 I quoted an IMF Official “It’s totally premature
to speak of a crisis in China” and I said ''In my experience, when
policy makers make these kind of pronouncements, it is exactly because
there is a crisis''
China has seriously infected Global Markets with the Yen soaring, and
Crude Oil has now crashed and burned and will have a $20.00 Handle
imminently.
I have watched the markets for Eternity and ''If the Markets are the
Message'' then There is a Message coming through load and clear.
European shares fell the most since August, crude oil tumbled to a
12-year low, and South Africa’s rand sank to a record after a slide in
Chinese stocks halted trading for the second time this week.
Meanwhile the Kenya Shilling pushed below 102.00 intra day and was
last at 102.09 which less than 0.5% below a 5 month high. The Shilling
is TEFLON. The Current Account is doing a 180 degree Turnaround [Crude
Oil refers]
The Nairobi all Share eased 0.07 points to close at 146.74
The NSE20 eased 5.42 points to close at 4003.11
Equity Turnover was better than lackadaisical at 341.907m
i expect the Kenyan Economy to be a bright Spot in a super-soft SSA



N.S.E Equities - Agricultural


Kapchorua Tea rallied +4% to close at 234.00 and traded 2,500 shares.
Kapchorua Tea has spiked +17% higher in 4 trading sessions this year.

Sasini Tea and Coffee which had been marked down on low volume
rebounded by the Daily Limit to close +9.97% at 18.75.



N.S.E Equities - Commercial & Services


Safaricom eased 0.6% to close at 16.50 and traded 1.546m shares.
Safaricom is +1.53% in 2016 and is underpinned for a move to 17.00.

Kenya Airways rebounded +3.22% to close at 4.80. The News that direct
Flights between the US and Kenya are now cleared for Take-Off is a
positive. I sincerely hope they tapered their fuel Hedges something I
advocated a while back to both the CEO and the CFO.



N.S.E Equities - Finance & Investment


Kenya Commercial Bank closed at 42.00 -1.75% and traded 2.071m shares.
KCB is +5% since 30th December 2015 closing and when the Hold Co.
Announcement was made.
Equity Bank was the liveliest share at the Exchange and closed -1.88%
at 39.25 and traded 2.786m shares worth 109.503m.
Standard Chartered closed +0.49% better at 204.00 and given the Supply
Side scenario [There isn't any], the price has scope to the Upside.



N.S.E Equities - Industrial & Allied


EABL rallied a mighty +6.81% to close at 298.00 and traded 6,700
shares which was pretty much what was available for sale. EABL is a
strong Earnings Story and the CEO who is also my Neighbour is exuding
confidence.

BAT closed unchanged at 799.00 and traded chunky volume of 94,700
shares worth 75.758m. BAT has been serene and has appreciated
marginally since the bribery ''hullabaloo'' blew up.

Cement Demand was a stand-Out with a +10.77% Expansion reported Q3
2015 versus Q3 2014 and this news finally brought a reaction from the
Cement stocks.
East African Portland Cement firmed +4.00% to close at 48.00 and
traded shares as high as 50.00 +8.7%.
Bamburi Cement rallied +2.94% to close at 175.00 where 72,100 shares
were traded.



by Aly Khan Satchu (www.rich.co.ke)
 
 
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January 2016
 
 
 
 
 
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