Nothing happened on the markets today that professionals were not expecting. In fact those who have been reading my posts and articles could have seen this coming as I tend to update whenever something significant happens.
The Uganda shilling closed at 3470 on the US dollar and some analysts think it rose up a lot. The last time I looked we did not have a shilling note of sh. 10. Please do not write home about the shilling rising. It is under pressure. It closed at 4946 on the British pound. Now this is worth writing home about. On the Euro it finished at 3779. Steady. On the Kenyan shilling, it improved a tiny bit closing at 33.89. On the Canadian dollar, the Uganda shilling is trending at 2385.
Coffee Arabica closed at $2.94 a kilo.
Coffee Robusta closed at $1.66 a kilo.
Gold trades 24 by 7 and it is running at $1089 an ounce. There is stable movement on gold and this is a good sign because it indicates that the level of fear in equities, forex and other commodities is not that much. More like Margin Calls and people cutting their losses. You can read about the Margin Calls factor on another article on this very same website. When there is massive fear in the markets, people fly into gold. This is not happening at all.
Oil, the darling of Uganda and many other developing countries which discover oil. Well, you can cancel that party. Oil closed at $28.45 a barrel. On Monday Jan 18, 2015 it even kissed the $27 area. It soon recovered but look how far we have fallen and I can assure you that based on the chart pattern and IRAN coming into play after the sanctions, Oil will touch $25 then beg to remain in the $20 range. Most professionals have factored all this in.
Shanghai pulled a nice move and recovered somewhat. It gained 0.44% leading to a whole gain of 12.87 points and closing at 2914.
Hong Kong index dropped by 0.94%. Very depressing because I had assumed that Shanghai would lift up Hong Kong.
Tokyo Nikkei lost 0.54% losing 93.84 points and closing at 17147. Something is not making sense here. I thought China made everything after God made heaven and earth. So why did Hong Kong and Tokyo fall when China rose?
Frankfurt DAX fell 0.25% losing 23.42 points. This might not seem significant but its chart looks to more down side.
Paris CAC fell 0.49% losing 20.59 points and closing at 4190. The chart sadly looks like DAX. We are going to have a bad year in financials.
London FTSE fell 0.42% losing 24.18 points and closing at 5780.
Toronto TSX lost 1.09% with 131 points down and ending at 11942.
DOW Jones lost 2.39% crashing down by 391 points closing at 15988. This is a very big drop for the Dow.
The NASDAQ fell by 2.74% losing 127 points and ending up at 4488.
The key things for all of us to keep an eye on are 1) Supply and Demand. Too many commodities on the market where the paying customers are in developing countries with an aging population. One can only drink so much coffee. 2) A more diverse consumer population. People are not going out of their way to accumulate wealth because the Millenial generation is very picky, social justice oriented and want to protect the environment. 3) Oil is just having another bad day. Too much oil on the market but Hallelujah praise the gods because this is a good thing. We can afford to move goods around the world at less cost. In fact we can even now enjoy all those pajeros. Care for the evenironment. Do not drive a gas guzzler. 3) Dictators around the world who rely on resources can now get a real job. 4) You cannot expect to become wealthy when most do not have food to eat. Uganda is in this stage. You have 5% pretending that the other 95% of the country are not hard working or intelligent. One day, you shall pay the price. You make a very big mistake to think that the 95% suffering Ugandans will remain quiet forever.
Martha Leah Nangalama