When I look through the crystal glass,I see:

1) a likelihood of a market depressed further by effects of crop failure (famine) in most parts of Ukambani. govt and people will have to find money to feed families!

2) political uncertainty caused by the waki tribunal might keep away foreign investors planning to return; there might be a major fall out between Ruto/Mudavadi and RAO resulting in a split ODM and btw PNU/NARK-K resulting in Uhuru loosing his footing and fighting off catwoman from Kirinyaga. If big suspects r let off,the masses will react adversely. If they r not let off,they fall out. Knowing the way Kibaki lets things take their natural course - this will be an explosive yet uncontrolled nuclear experiment.

(3) reduced exports as the recession in Europe and USA sinks further (probably into mid-2010) and the green revolution is used by the West to set new protectionist standards in intl trade. stocks in export will be hit especially horticulture.

Importers will do very well esp of cars and machinery,as these are likely to benefit from indirect subsidies to make them affordable abroad (but these cuts might be reduced 4 kenya,by increasing insurance costs on shipping as caused by somali pirates.

It is in Kenya's interest to sent troops to the Somali coast,if not mainland,but this wont happen coz our naional strategic interests are well safeguarded by our perfect wait n see foreign policy!

4) govt will be forced to offload its stake in parastatals or more likely to borrow heavily to meet budget deficits,in the light of unmet donor pledges! thus,Watch T-Bills and Bonds. If this happens,the banks will be back in serious business and their shares will be a good bet.

5) Safaricom is key determinant of the nse index; twill remain below 5 most of the year -till abt june when fibre optics excite some speculators to buy at 6-6.50..then back to 5. it is unlikely to reach 7 until it be cross-listed in UG,TZ and J'Burg towards end of 2009 or early 2010.

7) There will be renewed interest in African resources (land,agricultural produce,metals,oil and gas resulting in a new scramble for Africa led by China and the Middle East. The west will remain leaders in technology and financial services and dictators of terms and standards of trade,as their other industries are not cost-competitive.

Desperate,corrupt or gullible leaders in Africa -myopic- (except Libya,SA and Uganda) will sell off. The scramble will put scarce resources -and thus wealth - in foreigners' hands resulting in increased FDIs & employment -in the short-term,but a long-term increase in capital flight resulting in long-term poverty on the balance!

I could go on but wont! But methinks only financial stocks in heavily capitalized banks are safe for 2009. The Mutomo cement resources will not be exploitable until 2010 so the cement co.s not much there... besides,building industry will slacken... looks like we r sliding back to the 90s.

am riding the recession with KCB for the next 2 yrs unless a reliable source informs me that exporters hold a good chunk of its loan portfolio. but,mefeels,foreign investors will inevitably come back to this Ai top index when liquidity finally edges upwards.
Pata-potea: insiders,seasoned speculators,experts on entry and exit points - like jammo - and early buyers like me,will make some 20% or more by Dec 2009 on a wing,soccer and a prayer. More by mid 2010.

NB: I am not an economic expert and these are just economic opinions of a layman. Do not take them to the bank.

When buying shares,ask yourself,would you buy the whole company?

Most investors will diversify into the bonds market. Government spending on recommendations of waki report,resettlement of IDP'S and food aid will creat huge budget deficits. This will force the government to borrow heavilly domestically. As a result,interest rates will increase. The entertainment industry will continue to boom since people will seek to distract themselves from the cares of this world. Consequently I recommend kenya brewery and BAT shares as a good buy. In a bid to cut down on expenses companies will outsource their procurements as much as possible. BPO will be the main beneficiary. Hence growth in ICT Shares. The financial doldrums in USA europe and china will continue leading to migration of foreign investors to frontier markets. Counters in the financial sector that have recorded good profits will attract this investment. The current inflation in rents has created a strong desire for home ownership. Most funds exiting NSE Will end up in stone and mortar. Cement manufacturers will have good sales. Their shares are a good buy. Hfck shares will appreciate as there will be local demand for morgage. There are indications that the Automobiles financeing sector in the usa is going the way of the morgage sector. Thousands of automobiles will be auctioned over non payments. The same is set to replicate in Japan and europe. Second hand car dealers will have good bargains. The local assemblers will experience a decline in sales,as most people will opt to buy pre owned vehicles than new units. Counters like Cmc,marshals,Gm,will take a hit. Traffic jams will increase due to influx of cheap pre owned cars and weakening of major currencies against the local unit. Consumption of petroleum products will increase. Kenya oil shares are a good buy. The proceedings of the tribunal,constitutional reforms and other bad news will keep media houses busy. Nation media shares remain a good buy.

Osama bin Laden

Great analysis that has proper basis. I like it.

Why is this gloomy analysis receiving so much applause?

Learn something new everyday

I think 2009 will be tougher,i dont think we have seen the worst,already the USD has started to regain strength and this has a -ve correlation to stocks,i think we are going to see the USD trade higher than 86 to the ksh at least by the end of Q1

Most great companies where birthed durin recession...the rest took over in riddin economic booms. Whatever the case we need to learn to ride whatever the waves we get..recession or otherwise. Choice is largely biased toward infrastructural based products..thus IT indust,energy..not oil..and finance counters. Other non necessity based counter will just lull..ride overall market..thus consumer based counters myt get much activity..agricultural..some commercial..KQ,cmc,TPserena..etc..most non basic industries won't do ok. ..There's far much more to economy than can be put on a post but thing is..learn to ride whatever 09 brings out.

The race is not always to the swift..nor the battle always to the strong..nor food always to the wise..nor riches always to the intelligent..favor is not always to the skilled..or learned..but time and chance happens to all. Ecl9:5..

Thank you for the info. Just what I needed to know!

When buying shares,ask yourself,would you buy the whole company?

Things will be better this year,no doubt! Happy investing :)

Whats your take on the Centum share? do u think what happened in the last financial year e.g the high turnover of senior managers plus their investment in RVR will contribute to low activity this year? Do u think the co has a good Balance sheet strength to invest this year taking into account the Risk apparent in the economic status at present?

be prepared and miss the opportunity rather than get the opportunity and not be prepared.

I'm not sure about KCB given their exposure in Triton. Pg 19 of today's nation has them suiing Triton.If this ends up as a write off...