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Morning Note: The Uneasy Calm in Global Markets.

Markets open with more optimism today from last week’s crash. For the first time this week, yesterday the NSE All share & the NSE 25 share indices made moderate gains, factored in through a rise in the blue chip counters, mainly Safaricom and KCB Group. Tuesday saw the Nairobi bourse gain Sh10 billion in market capitalisation, recovering some of the heavy losses recorded on Monday.

The S&P 500 rallied 4.9% as investors digested a trickle of news that President Donald Trump and his team are looking at measures including cutting payroll taxes and aiding ailing businesses like airlines and cruise operators. Stocks whipsawed throughout another wild day on Wall Street, wiping out a gain of 3.5% to turn negative before a furious rally in the final two hours of trading delivered the biggest gain since December 2018

Generally, global markets experienced an uneasy calm on Tuesday, despite this, almost all markets experienced a standard rise in indices.

In the news today;

Kenya Reinsurance hopes the government will extend the law which mandates all insurance firms to cede 20% of their insurance income to the company. This is meant to secure a steady flow of business for the re-insurer in which government holds 60 percent stake and help it to ring-fence its market share on the back of highly competitive industry.

Kenyan insurers are also required to place 10 percent and five percent of their business respectively with Zep Re and Africa Re. Other reinsurers can, therefore, benefit from only 65 percent of the cessions.

KCB Group announced yesterday they had completed the compulsory buyout of dissenting minority shareholders of National Bank of Kenya (NBK) after issuing 4.4 million of its shares currently worth Sh212 million to the holdouts. All shareholders of NBK now have tradable KCB shares in their accounts.

• Japan’s Topix index was little changed as of 12:20 p.m. in Tokyo.
• South Korea’s Kospi index retreated 1.2%.
• Hong Kong’s Hang Seng added 0.2%.
• The Shanghai Composite Index rose 0.3%.
• Australia’s S&P/ASX 200 Index lost 2.2%.
• S&P 500 futures fell 1.8%. The index rose 4.9% on Tuesday.
• Euro Stoxx 50 futures rose 1.5%.

• The yen rose 0.7% to 104.95 per dollar after sliding 3.2%.
• The offshore yuan was at 6.9582 per dollar.
• The euro bought $1.1322, up 0.4%.

• The yield on 10-year Treasuries dipped about 12 basis points to 0.68%.
• Australia’s 10-year bond yield fell about seven basis points to 0.72%.

• West Texas Intermediate crude surged 2.9% to $35.37 a barrel.
• Gold added 0.5% to $1,656.69 an ounce.

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