Genghis Cross-Asset Weekly Strategy - 3rd August 2020
In this week's edition of the Weekly Cross-Asset Strategy Report, we give a recap of the equities, fixed income, currencies and derivatives markets' performance over the past week and our trading ideas for the coming week.
Our Momentum, Income and Value equities portfolios continue to outperform the benchmark NSE 20 index. Performance of the Momentum and Income portfolios was ahead of all the benchmark indices including the Nairobi All Share Index (NASI) and Zamara Index.
Genghis Trading Ideas for the week…
Equities
Maintain BUY rating on EABL at current price levels (KES 160, TP 201.68).
FY20 performance was mostly as expected except one-off provision of KES 3.2Bn which surprised on the downside. In the short-term, investors may be spooked by lack of a final dividend.
Fixed Income
BUY FXD2/2018/20 in the ongoing TAP-Sale
The CBK is seeking to raise KES 40Bn from the TAP Sale on the 20-year tenor (FXD2/2018/20). The paper is currently trading at an implied yield of 12.637% (dirty price of 104.12). As such, the offered price (KS 102.35) is attractive coupled by its higher coupon rate of 13.20%.
Global Markets & Derivatives
We are eyeing BUY positions on September 2020 futures contracts for Equity and KCB. For KCB, we will have a Take Profit (TP) at KES 39 and a Stop Loss (SL) at KES 31 while a TP and SL at KES 36 and KES 30, respectively, for Equity.
Genghis Capital is an innovative and customer focused Investment Bank licensed by the Capital Markets Authority (CMA). Founded in 2008, Genghis is one of the leading investment banks in Kenya. Since its establishment, Genghis has achieved tremendous growth to offer a well-diversified portfolio of financial services that includes:
- i. Securities(Equity/Debt) Trading
- ii. Research
- iii. Wealth Management services
- iv. Investment Advisory & Management via the GenCap Unit Trusts
- v. Corporate Finance & Transaction Advisory services
The Kenyan Capital Markets continue to develop in size, scope and sophistication. With this is an increasing demand for more specialized and personalized brokerage service and we at Genghis Capital are glad to be able to offer you this service. Our strength lies in ensuring our clients are up to speed with developments at the stock market and the economy. Research and technology remains our competitive and comparative advantage hence Experience, Expertise and Professionalism are some of the qualities you can expect from our team.
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