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Elliott Wave Analysis Of The NSE 20
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DBLyon
#891 Posted : Friday, September 25, 2015 1:28:49 PM
Rank: Member

Joined: 5/28/2014
Posts: 149
Location: Nairobi
Metasploit wrote:
hisah wrote:
snipermnoma wrote:
hisah wrote:
snipermnoma wrote:
hisah wrote:
Bounce progress as expected. The real test will be if 4000 will hold on the next nosedive episode. That level has to hold if bulls are to survive!

Global equities are still undecided, but I expect another downside episode soon.


Meanwhile USD to Kes. has been hovered around 105 for two weeks (one might say at least Kes is not sliding but with all the intervention why is it not improving either?)

In the same two weeks NSE 20 has been in a narrow band 4125 to 4260.

today 91 T-bill rate at 14.486%, higher than 182 T-bill which is at 13.861% and higher than the coupon on most bonds.

This points to a recovery without legs. The steam will run out soon. I agree with @hisah 4000 will be tested with support at 3930.79 as per @mnandii post

The money market is signalling stress! Interbank rate is above 20% again like in August while the 182 and 364 day tbills are getting undersubscribed. Nobody willing to pack money there at the current rates as 91 day rate is almost vaulting the 364 day rate! The dread inverted yield curve is almost striking home! A clear recession sign as liquidity squeeze continues.


@hisah What a difference a week can make...and it came to pass 91 T-bill rate at 18.607% subscription 128% (link), higher than 182 at 14.551% subscription 5.31%, 364 at 16.301% subscription 11.31% (link). 1yr bond is 19.062% coupon (link). Meanwhile Interbank at 25.6398%. This points to stocks heading south.

Liquidity vacuum! CBK is sitting on very sharp needles and attempting to smile! Yet most banks are profitable without liquidity this year!? Someone is applying thick layers of very glossy lipstick to look attractive!

Econ macros out of sync and now vapour liquidity, this is now beyond profit warnings window.


Laughing out loudly Laughing out loudly Laughing out loudly Laughing out loudly Laughing out loudly Laughing out loudly Laughing out loudly Laughing out loudly Laughing out loudly Laughing out loudly

The last slide before the rebound had totally no support for banking stocks!!!

Next slide will be major

One of the strong indicators of what's going on...generally unsophisticated investors looking for money to buy T-Bills.
When you live for others' opinions, you are dead.

- Carlos Slim Helu
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Aguytrying
#892 Posted : Friday, September 25, 2015 1:29:10 PM
Rank: Elder

Joined: 7/11/2010
Posts: 5,040
The money markets look like a good place to hide as we wait for the stock market to go lower. Mmf funds must be getting good rates with these high interest rates
The investor's chief problem - and even his worst enemy - is likely to be himself
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lochaz-index
#893 Posted : Friday, September 25, 2015 4:26:51 PM
Rank: Veteran

Joined: 9/18/2014
Posts: 1,127
Cde Monomotapa wrote:
hisah wrote:
snipermnoma wrote:
hisah wrote:
snipermnoma wrote:
hisah wrote:
Bounce progress as expected. The real test will be if 4000 will hold on the next nosedive episode. That level has to hold if bulls are to survive!

Global equities are still undecided, but I expect another downside episode soon.


Meanwhile USD to Kes. has been hovered around 105 for two weeks (one might say at least Kes is not sliding but with all the intervention why is it not improving either?)

In the same two weeks NSE 20 has been in a narrow band 4125 to 4260.

today 91 T-bill rate at 14.486%, higher than 182 T-bill which is at 13.861% and higher than the coupon on most bonds.

This points to a recovery without legs. The steam will run out soon. I agree with @hisah 4000 will be tested with support at 3930.79 as per @mnandii post

The money market is signalling stress! Interbank rate is above 20% again like in August while the 182 and 364 day tbills are getting undersubscribed. Nobody willing to pack money there at the current rates as 91 day rate is almost vaulting the 364 day rate! The dread inverted yield curve is almost striking home! A clear recession sign as liquidity squeeze continues.


@hisah What a difference a week can make...and it came to pass 91 T-bill rate at 18.607% subscription 128% (link), higher than 182 at 14.551% subscription 5.31%, 364 at 16.301% subscription 11.31% (link). 1yr bond is 19.062% coupon (link). Meanwhile Interbank at 25.6398%. This points to stocks heading south.

Liquidity vacuum! CBK is sitting on very sharp needles and attempting to smile! Yet most banks are profitable without liquidity this year!? Someone is applying thick layers of very glossy lipstick to look attractive!

Econ macros out of sync and now vapour liquidity, this is now beyond profit warnings window.


Aicaramba! Yup, no arbitrages here. USD/KES bulls scoped?

More Bearish outlook for banks. Similar to Naija. The hustle for deposits beckons, NIM squeeze a given;

Treasury migrates ministry accounts to online platforms
Quote:
The Treasury early this year ordered all State corporations and agencies to surrender billions of shillings held in commercial banks as surplus cash to CBK.

The order — part of measures to help curb unnecessary borrowing — obligates government ministries, and State agencies and corporations to ensure that all their cash-flow requirements are handled through a single account hosted by the CBK.

The Treasury said State corporations and agencies were holding huge sums of surplus cash in short-term bank deposits or funds invested in Treasury bills and bonds even as they continued to receive regular budgetary allocations.

http://www.businessdaily.../-/fc700nz/-/index.html

Banks seen relying on transaction fees as margins shrink Particularly concerned about CFC, BBK & SCBK. Under invested in this regard.

On the flip, thinking of cash flush low debt like BAMB & Scan to capitalize on these rates. Rollover paradise!


The banks were handed a reprieve last month only to have it rudely snatched away again...tough business. In short the interbank rate is headed for the skies.
The main purpose of the stock market is to make fools of as many people as possible.
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lochaz-index
#894 Posted : Friday, September 25, 2015 4:49:51 PM
Rank: Veteran

Joined: 9/18/2014
Posts: 1,127
instinct wrote:
Aguytrying wrote:
The rebound in september has been strong, one can almost feel like the bear is dead


I have that strange "instinct"too. In the absence of some traffic event we could be headed north


Lots of hopeful talk about a dead bear. The bear is just warming up. When very astute countries have been reduced to debasement of currency just to try and stay afloat you know things are thick.

Attempting any analysis without factoring in the global perspective is a guaranteed deer in headlights moment.



The main purpose of the stock market is to make fools of as many people as possible.
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instinct
#895 Posted : Friday, September 25, 2015 4:53:56 PM
Rank: Member

Joined: 8/17/2007
Posts: 294
lochaz-index wrote:
instinct wrote:
Aguytrying wrote:
The rebound in september has been strong, one can almost feel like the bear is dead


I have that strange "instinct"too. In the absence of some traffic event we could be headed north


Lots of hopeful talk about a dead bear. The bear is just warming up. When very astute countries have been reduced to debasement of currency just to try and stay afloat you know things are thick.

Attempting any analysis without factoring in the global perspective is a guaranteed deer in headlights moment.





bado mnasema kuna bear? with KCB back at 50. i dont think so..
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VituVingiSana
#896 Posted : Friday, September 25, 2015 8:16:24 PM
Rank: Chief

Joined: 1/3/2007
Posts: 18,347
Location: Nairobi
Interbank Rates at 26%.

Banks with government business/deposits are feeling the pinch as CBK/Treasury is pulling GoK/County deposits back to CBK. Banks like KCB & Equity were lending "GoK cash/deposits" to customers but now have to find other sources to cover the GoK cash that has withdrawn.

KCB, NBK and Equity are the most affected.

As a taxpayer, it makes ZERO sense for GoK to have cash sitting at commercial banks while GoK borrows the same money using T-Bills or Bonds. Though for the banks that did not expect a GoK pullback, ouch!

GoK has no cash. It has maximized the overdraft from CBK. It couldn't even get a 100% subscription rate for the 1 year T-Bond even after paying 19.5%.

Sensible banks will stop lending to marginal customers and invest in T-Bonds. Why lend to a customer, with the risk it entails, when GoK is paying 19.5%? Plus the Bonds qualify as 0% risk for Risk Weighted Assets calculations.

http://www.businessdaily.../-/fc700nz/-/index.html

BTW, overall, as an economy, we are f----d until GoK can get its spending under control.
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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  | | Edit by user: Friday, September 25, 2015 8:20 PM | Reason: Not specified
instinct
#897 Posted : Friday, September 25, 2015 11:54:11 PM
Rank: Member

Joined: 8/17/2007
Posts: 294
@vvs ur making sense up there
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hisah
#898 Posted : Saturday, September 26, 2015 12:38:50 PM
Rank: Chief

Joined: 8/4/2010
Posts: 8,977
VituVingiSana wrote:
Interbank Rates at 26%.

Banks with government business/deposits are feeling the pinch as CBK/Treasury is pulling GoK/County deposits back to CBK. Banks like KCB & Equity were lending "GoK cash/deposits" to customers but now have to find other sources to cover the GoK cash that has withdrawn.

KCB, NBK and Equity are the most affected.

As a taxpayer, it makes ZERO sense for GoK to have cash sitting at commercial banks while GoK borrows the same money using T-Bills or Bonds. Though for the banks that did not expect a GoK pullback, ouch!

GoK has no cash. It has maximized the overdraft from CBK. It couldn't even get a 100% subscription rate for the 1 year T-Bond even after paying 19.5%.

Sensible banks will stop lending to marginal customers and invest in T-Bonds. Why lend to a customer, with the risk it entails, when GoK is paying 19.5%? Plus the Bonds qualify as 0% risk for Risk Weighted Assets calculations.

http://www.businessdaily.../-/fc700nz/-/index.html

BTW, overall, as an economy, we are f----d until GoK can get its spending under control.

The money market is absolute bananas! Inflation rate is 5.8% but tbill rates as well as 1yr tbond almost vaulting 20%. Absolute madness! Private sector is in a liquidity desert and GDP will tank badly. Tax revenues will shrink and gok will keep on hogging liquidity from the real economy. What nonsense is this? Lose lose for everyone.
$15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!
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Cde Monomotapa
#899 Posted : Saturday, September 26, 2015 7:23:37 PM
Rank: Chief

Joined: 1/13/2011
Posts: 5,964
mugo2of3 wrote:
Cde Monomotapa wrote:
hisah wrote:
@cde, any firm flush with cash will be in rollover utopia as they command interest rates to be paid for their deposits... However those with huge debts especially forex loans like ARM etc will be taken to the cleaners for a rough shaving.

I've also recommended BAMB a while back as a nice stock to pack your cash while the bear storm does its thing.

The current equities bounce will head nowhere with the madness going on at the money markets. Equities need liquidity to sustain rallies. Vapour volume rallies lose the entire uptrend when selling bout kicks in since such rallies have no legs (solid base).


No hurry. There are 3 more months to clear with CGT and open the polling booths proper. Tactical to buy the Bear and bet on foreign infusion post-CGT. Discounts galore.


I thought that the CGT has already been scrapped ?
http://www.cma.or.ke/index.php?...test-newz&Itemid=574


Quote:
President Uhuru Kenyatta on September 11 signed into law the Finance Bill 2015 abolishing both capital gains tax (CGT) of five per cent and the withholding tax of 0.3 per cent on all securities traded on the NSE.

Kenya has abolished taxes on profit made from the sale of shares and bonds through the Nairobi Securities Exchange (NSE) with effect from January 1, 2016 to restore investor confidence, boost trading and position the country as an attractive investment destination in Africa.
http://www.theeastafrica.../0/-/kyodq5/-/index.html
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  | | Edit by user: Saturday, September 26, 2015 8:24 PM | Reason: Super Official
Gatheuzi
#900 Posted : Sunday, September 27, 2015 7:24:47 AM
Rank: Veteran

Joined: 8/16/2009
Posts: 994
hisah wrote:
VituVingiSana wrote:
Interbank Rates at 26%.

Banks with government business/deposits are feeling the pinch as CBK/Treasury is pulling GoK/County deposits back to CBK. Banks like KCB & Equity were lending "GoK cash/deposits" to customers but now have to find other sources to cover the GoK cash that has withdrawn.

KCB, NBK and Equity are the most affected.

As a taxpayer, it makes ZERO sense for GoK to have cash sitting at commercial banks while GoK borrows the same money using T-Bills or Bonds. Though for the banks that did not expect a GoK pullback, ouch!

GoK has no cash. It has maximized the overdraft from CBK. It couldn't even get a 100% subscription rate for the 1 year T-Bond even after paying 19.5%.

Sensible banks will stop lending to marginal customers and invest in T-Bonds. Why lend to a customer, with the risk it entails, when GoK is paying 19.5%? Plus the Bonds qualify as 0% risk for Risk Weighted Assets calculations.

http://www.businessdaily.../-/fc700nz/-/index.html

BTW, overall, as an economy, we are f----d until GoK can get its spending under control.

The money market is absolute bananas! Inflation rate is 5.8% but tbill rates as well as 1yr tbond almost vaulting 20%. Absolute madness! Private sector is in a liquidity desert and GDP will tank badly. Tax revenues will shrink and gok will keep on hogging liquidity from the real economy. What nonsense is this? Lose lose for everyone.


A very heavy price to pay just to save the shilling.
Time is money, so money is time. Money saved is time gained in reverse! Money stores your life’s energy. You expend your energy, get paid money, and store that money for a future purchase made in a currency.
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