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Will NSE touch 4,000 betweeen now and 2012?
Rank: Veteran Joined: 11/21/2006 Posts: 1,590
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Under normal conditions,a 30% rise to 4,000 would not seem that daunting,but the NSE has been stuck around the 3,000 for a while. Can our great leaders deliver the economy to get us to 4,000 before the likely move back down in 2011 and 2012? www.mjengakenya.blogspot.comSehemu ndio nyumba
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Rank: Elder Joined: 2/7/2007 Posts: 11,935 Location: Nairobi
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@Mainat, our leaders??......Do we have any?....i mean,this idiots are engrossed in politics of thy selves.......They won't deliver even a lousy louse.We are in for a long haul. Old man about town.... Nothing great was ever achieved without enthusiasm.
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Rank: Member Joined: 7/29/2008 Posts: 170
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Our trading patterns are also to blame....
like for example someone places an buy order for safcom at 3 bob,then places another order at 3.20,another one at 3.40,then at 3.60,all these orders range from 3 to 5 million,before u notice the share moves to 3.90 on seeing this trend the rest of us starts offloading but by the time our orders gets to the board,he offloads all his shares at 3.80 and we all go for a dip settling at levels of 3.50 for the lucky ones n thus pushing the price back to 3.00 or even lower....
Technology has also made trading easier n faster,so soon it might be (if its not already is) possible to place efficient trailing stop loss orders and a result slow down the price rallies. so my honest opinion we have good chances of hitting the 4k mark but offcorse if the economy improves and companies regain profit making trends
my 2 zim cents
Its just me whatever choice you make in life make sure that you can live with it.
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Rank: Veteran Joined: 7/24/2008 Posts: 781
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What we are seeing here is market capitulation...no willing sellers or buyers...time to get in and play long...as long as companies continue making profits. The utimate goal of investing is to buy low sell high;if we re-write this core equation in psychology terms it becomes buy fear sell greed.
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Rank: Member Joined: 1/12/2007 Posts: 75
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Lets start by listing the challenges facing the market in
the order of its weight;
1. Prevailing political uncertainity after the 2007 debacle.
2. Failure to institute political and land reforms to fix 1.
3. Food,power and water crisis.
4. Low investor confidence after collapse of brokers.
5. To a lesser extent,the global financial meltdown.
Since political class on both sides prefer to maintain the status quo,1 and 2 are unlikely to be addressed by 2012,if ever. The crisis management attempts to sort 3 will mean more expensive power,less water and food,therefore we shall a less competitive investment destination,for both local and foreign investors. In fact,it creates an opportunity for a small group who-is-who to profit from the situation. On 4,CMA has taken the right steps to rein in brokers but we are still far away from restoring confidence.
In my humble opinion,the market will head further south as we approach 2012.
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Rank: Member Joined: 12/13/2006 Posts: 108
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Imagine the NSE at 1500 points in 2012
Equity at 7.00 Kshs
Mumias at 3.50 Kshs
SCOM at 2 Kshs
It doesn't look likely but could happen. Currently a lot of what could go wrong is going wrong. Kenyans seem to be most unlikely to prevent disaster. In 2012 there will be looming anxieties fueled by the risk of ethnic violence - if we degenerate to complete lack of law and order,there is likely to be a massive loss of confidence not only in the NSE but in Kenya as a country.
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Rank: Member Joined: 5/26/2009 Posts: 326 Location: Nairobi
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2010 could breath some life into NSE as some factors affecting economy today gets mitigated. 1. el nino brings good harvest,2. a dull year politically as goons position for 2012,hence good for business,3. economic crisis dissipates and investments (short term) increases.
By 2011any bad thing that can happen to NSE will happen. Time to get into medium/ long haul during 2011 expecting any ROI during 2014.
2012 - polls fear and uncertainty could drive NSE index to sub- 1500. After polls (and most likely nothing happens) we could see investors crawling from under the rock.
I wrote this under influence...
Healthy eating = nutritious urine. Nyama choma anytime!
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Rank: Veteran Joined: 11/21/2006 Posts: 1,590
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Two things will be key. Investor confidence which is driven by hope for the future. So the question is where is hope? Hope in Kenya is driven by economy (see 2) which may turn; politics-will if anything get worse as all eyes turn to 2012 succession (will Gen Kig succeed in pushing his term out by a couple of yrs?) and the general well-being based on things like crime,corruption,inflation et al... Economy: El nino (if it does turn up),will allivaite the power,water and food issue. So that means 2010 will be better. The NSE like all markets looks forward 8-9 months and I'd see it rise in 2010 but set off in early 2011 as we've opined. www.mjengakenya.blogspot.comSehemu ndio nyumba
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Rank: Elder Joined: 12/6/2008 Posts: 3,548
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@reithi....i wonder what makes you say 'to a lesser extent the global financial meltdown'.....isn't it obvious yet to you that this is the single most significant factor in NSE I am a general consultant,specializing in all areas. A New Kenya
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Rank: Member Joined: 12/13/2006 Posts: 108
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If you map the NSE index with major world indeces you'll see the obvious correlations. Now that we have a recovery in the major world indexes we might begin to see an improvement in this bourse as well.
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Rank: Member You have been a member since:: 7/7/2009 Posts: 9
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Rank: Member Joined: 1/12/2007 Posts: 75
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@ Much Know
Lets call a spade a spade. The main problems afflicting the market are self inflicted. Please note that political instability was top of my list followed by lack of investor confidence. Chronologically,it went down in January 2008 after events we all know,followed by the broker drama,and has never recovered since then. By the time the global crisis crept in around August 2008,the damage was already done.
reithi
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Rank: Veteran Joined: 5/20/2008 Posts: 1,126 Location: Nairobi
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Let me just say I really hope it rises and soon. Enough said. Romans 8:28 (New International Version) More Than Conquerors And we know that in all things God works for the good of those who love him,who have been called according to his purpose. JOIN MY FREE MINI-COURSE FOR WRITERS. CLICK HERE
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Rank: Elder Joined: 2/26/2008 Posts: 4,449
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I think the overall market will rise but a 30% gain is more assured for select counters before the election. In my view,an investor needs to:
1. Break the suggested time period to:
(a) Pre-election year and election candidates are known. August/December 2011 or even will be a reflective point for investment. Investment horizon in equities should be made with this 'safe' horizon.
(b) Once election candidates are known,associated political risk is assessible and for the risk averse probably once election results are known. A bull run usually follows Kenyan elections...
2. Reduce scope from the general market to economic sectors in a growth face. Restrict investments to these sectors. In my view,the construction,telecommunications and financial sectors are good bets over this period.
Consequently,investments in sectors listed in (2) above may yield above average returns over the cut-off periods sugegsted which translates to the average percentage gain alluded to. An investor should consider the highest return for his investment not by market averages in my view but carefully selected counters. A 30% gain over this period is well within reach. My 2 Cents.
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Rank: Veteran Joined: 11/21/2006 Posts: 1,590
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Ectasy- economic and politics are unfortunately inter-married in Kenya. At a certain level,political posturing and noises start interfereing with the economy i.e. depress the economy and its outlook. I think that is what we face between now and 2011. In 2011,the whole thing crystallises because everybody with money to invest will adopt a wait and see attitude irrespective of the candidates. www.mjengakenya.blogspot.comSehemu ndio nyumba
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Rank: Elder Joined: 2/26/2008 Posts: 4,449
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True. 2009 - 2011 is shaped to an extent on that. To determine the severity,I break it down further to:
1. 'Troops'
These are politicians whose utterances are suggestive and advisory,ultimately 'harmless'.
2.'Generals'
These are politicans with the capacity and wherewithal to induce violence in areas they have support and beyond. This can be narrowed to political tribal chiefs from:
(i) Rift Valley
(ii) Central
(iii) Nyanza
3. Incumbent
This is the one currently in office whose term is set to expire. Will he push for a third term?
4. Revolutionary
Will Kenyans have a chance to vote in a radical? Maina Njenga?
I find (1),(3) and (4) harmless on the overall in the period leading up to 2012.
The Generals pose the greatest variable to the overall mood. So far they have a semblance of wanting to work together...
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Rank: Elder Joined: 2/26/2008 Posts: 4,449
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With key witnesses reportedly already flown out and a 'wheelbarrow of evidence' stacked against PEV masterminds,it will be interesting to see how the NSE reacts to news arising from Koffi Annan's visit and that followed by Mr Ocampo..
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Rank: Veteran Joined: 7/24/2008 Posts: 781
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Things are definitely not good. The utimate goal of investing is to buy low sell high;if we re-write this core equation in psychology terms it becomes buy fear sell greed.
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Rank: Elder Joined: 2/27/2007 Posts: 2,768
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our market is driven by sentiments and generally investor moods....hardly fundamentals...we have since long time ago allowed politics to permeate into our financial institutions and any sensitive turn in politics of the day have an equivalent ripple effect in the NSE...If no meaningful changes in the governance within the coalition government is achieved prior to 2012,then the NSE index will receive a thorough beating... NEVER TALK OF A RHINO IF THERE IS NO TREE NEAREBY - ZULU PROVERB ...besides, the presence of a safe alone does not signify that there is money inside...
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Rank: Chief Joined: 1/3/2007 Posts: 18,099 Location: Nairobi
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yes,it will Greedy when others are fearful,Very fearful when others are greedy - to paraphrase WB Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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