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Saturday, July 22, 2017

Geopolitical risks roil global markets

Turkana oil./COURTESY
Turkana oil./COURTESY

International markets turned ballistic as investors suddenly woke up to geopolitical risk, President Trump risk and a possible impeachment.

Mr Bernanke told the FT: “It always puzzled me a little bit - it still does - that markets are blase about political risk until the last moment.”

Trump impeachment odds surged with Ladbrokes quoting an Odds-On Price which is close to a racing certainty

‘’This is the single greatest witch hunt of a politician in American history!’’ President Trump tweeted a moment ago.

I believe President Trump is set to be terminated. The remaining open question is the method of termination.

The markets which had been in a halcyon moment [the calm before the storm] saw its nerves fray bigly ON Wednesday.

The dollar Index as returned to pre November 8 levels.

The US stock market had its biggest percentage fall in in 2017

The Brazilian markets halted currency trading, futures crashed and bonds tumbled most on record.

Investors sought out safe havens with gold and the yen spiking higher big time.

I attended the IMF’s launch of their regional economic outlook on Wednesday and I have two takeaways:

First, we have not yet adjusted our 5.3% FY 17 GDP forecast, says Armando Morales @IMFNews.

Secondly, the IMF economist confirmed tat private sector credit growth was negative in Q1 2017.

At the Nairobi Securities Exchange, equity market has closed at a 2017 high.

Safaricom rallied +1.234% to close at 20.25 and was the most heavily traded share at the Exchange with 20.134m shares worth 412.030m changing hands. I expect fresh all time highs in due course.

KCB Group surged +3.42% to close at a Fresh 2017 high of 37.75 and traded 1.894m shares. KCB is +31.3% in 2017 and a real outlier in 2017.

Co-op Bank firmed +0.59% to close at a Fresh 2017 high of 16.95, and is now +28.4% in 2017.

Equity Group rallied +2.98% to close at a fresh 2017 high of 34.50 and is now +15% in 2017.

EABL which has been oversold of late and management a little lackadaisical about laying the investment case rallied +1.32% to close at 230.00 and was trading at session highs of 235.00 +3.52% at the closing bell. EABL traded 521,400 shares.

KenGen which crossed important chart resistance at 6.65 this week pushed on +1.48% to close at 6.90 and traded 722,400 shares.

Bamburi Cement traded a chunk of 335,200 shares all at 165.00 +3.13%.

Aly-Khan is a financial analyst

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