7 May 2013

Kenya: Did Someone Try Pushing Uchumi Price Lower?

The Nairobi All Share rallied 0.77% to close at 120.99. The Market was actively traded with Turnover of 761.074m. The Nairobi NSE20 rallied 25.25 points to close at 4846.43. The Equity Market has resumed its upwards march.

The Nairobi All Share entered a bull market at the end of May 2012 when the index had rallied 20% and that defines a classic definition of a bull market. The market was exiting a Price disequilibrium which had infected the Equity markets after the 2007 election.

The catalyst for the rally was a fundamental mispricing of the market which became extreme as Listed companies performed far better than the Market was allowing for. The Peaceful Election this Year and the concomitant 'De-Risking' of Kenya Equity Markets was a further satalyst.

The big cap Counters have been leading the rally and this is because the world has been flooded with Fiat currency via the likes of QE from the FED, Abenomics out of Japan and the ECB is now talking of paying negative interest rates on deposits at the European Central Bank.

This liquidity is also supporting the Nairobi Securities and particularly the big cap counters which are once again asserting a leadership position. In Agriculture, Williamson Tea rallied 7.93% to close at 245.00 and traded 500 shares which were the only shares available for sale. In Commercial and Services, the big news that has just flashed across my screen is that Dimension Data has offered to buy out Access Kenya at 14 shillings a share which is a 42% Premium to Fridays closing Price. Access Kenya actually eased 3.05% during todays Session to close at 9.55 and traded 42,000 shares.

Access Kenya has rallied 117% through todays close this Year and the Somens had been in 'go-shop' mode for a while now. Safaricom firmed a further 0.71% to close at 7.05 and this is a 58 month closing Hhigh. Safaricom traded 32.8m shares worth 232.827m. Safaricom is +40.594% this year. Uchumi rallied 3.81% to close at 20.50 traded 781,500 shares worth 16.029m. Uchumi has bounced 10.521% since closing at 18.55 on the 2nd of May.

There was no fathomable reason for that price drop other than someone unsuccessfully was trying to wrestle the price lower. Nation Media traded 2,800 shares all at 285.00 +2.15%. In Banks, Kenya Commercial Bank improved 0.6% to close at 42.25. KCB traded 4.541m shares worth 192.896m. Equity Bank released Q1 Earnings where Q1 2013 PBT increased +21%. The stock firmed 0.81% to close at 31.25 and traded 1.017m shares worth 31.799m. Equity Bank is +31.57% in 2013.

Standard Chartered firmed 1.035% to close at 291.00. There is very little on the supply side and Standard Chartered traded 2,800 shares. In Industrial and Allied, EABL rallied 2.1875% to close at 327.00 which is a fresh all time closing high. EABL traded 430,100 shares worth 140.788m. Athi River Mining firmed 1.54% to close at 66.00 and traded 972,500 shares worth 64.189m. ARM is +47.982% in 2013 and has embarked on a serious cement capacity scale up.

East African Portland eased 0.93% to close at 53.00 and traded 2,600 shares. Crown Berger traded 9,700 shares at 51.00 -9.73% and Limit down. Crown Berger remains +20.00% in 2013.

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