GCC Daily Market Update - 6 November

Transcription

1. WEEKLY WRAP November 06 , 2016 ECONOMIC UPDATE & NEWS Source: Bloomberg GLOBAL NEWS     The Fed has kept key rate unchanged at 0.25% to 0.5% range and intends to wait for further evidence of continued progress over its objectives, before hiking rates. (Source: Reuters) US nonfarm payrolls increased by 161,000 in October-16, with upward revisions to the two prior months bolstering the recent trend of job gains, according to the Labor Department. The unemployment rate edged down to 4.9%. (Source: WSJ) US consumer spending rose by 0.5% MoM in Sep-16 supported by robust spending on motor vehicles. (Source: Reuters) US Treasury said that it would borrow USD 188.0bn through credit markets in Q4-16 up from an initial estimate of USD 182.0bn. (Source: Reuters)        Moody’s said that UK's Aa1 sovereign rating would be downgraded if the EU loose access to the EU single market as this would materially damage its medium-term growth prospects. (Source: Moody’s) Eurozone GDP grew at a stable rate of 0.3% YoY in Q3-16 supported by improvement in Austria and France. (Source: Reuters) Germany unemployment rate fell by 0.1% MoM to 6.0% in Oct-16 as jobless total fell by 13,000 to 2.7mn. (Source: Reuters) BoJ has kept short term policy rate unchanged at minus 0.1%, despite sharply cutting its inflation targets. (Source: Reuters) Japan's industrial production remained unchanged at 0.0% in Sept-16 compared to 1.3% in Aug-16, as private consumption and overseas demeaned remains pressured. (Source: Xinhua) Reserve Bank of Australia Governor kept interest rates unchanged at a record low of 1.5% in an effort to avoid further escalation in property prices and household debt. (Source: Bloomberg) Turkish banks' combined net profit surged 55% YoY to TRY29.04 bn in 9M-2016. (Source: BDDK) UST 10yr Bond 1.90 1.80 1.70 1.60 1.50     Fitch said that Saudi Arabia, Abu Dhabi and Qatar's international bond issues amounting USD 31.5bn create a pricing benchmark that will help capital markets grow in the region. (Source: Arabian Business) The UAE Cabinet has approved a federal budget of AED 248.0bn for the next five years, with a prime focus on education, social development and health (Source: The National) The Chairman of UAE’s bank federation said that bad loan provisions by UAE banks will peak in 2016 due to renegotiation in loan terms instead of calling defaults. (Source: Reuters) The residential property prices in Dubai fell 4.6% YoY in Sep-16, due to a sharp fall in apartment and villa prices. (Source: Trade Arabia) Dubai's government announced plans for an initial USD 3bn financing deal to support the expansion of the emirate’s two international airports. (Source: Arabian Business) 31-Oct 24-Oct 17-Oct 10-Oct 03-Oct 26-Sep 1.40 Source: Bloomberg      The UAE is targeting an economic growth rate of about 4% in 2017 as it looks to the non-oil economy for expansion, the undersecretary of the Ministry of Economy said. (Source: The National) Net foreign assets at SAMA fell by USD 7.4bn to USD 546.7bn in Sep16 from the previous month, as the government drew down reserves to cover a budget deficit caused by low oil prices. (Source: Reuters) Saudi Arabia's Capital Market Authority approved rules for exchangelisted real estate funds to ramp up investment in country's housing market. (Source: Zawya) Oman Central Bank chief said that the interest rate ceiling on personal loan of commercial banks in Oman would not be increased, despite its general increase in financial system. (Source: Times of Oman) The Central Bank of Oman issued a treasury bill with a total value of OMR42mn for 91 days from 2nd Nov-16 while average yield reached 0.85138% and 0.85319% respectively. (Source: Times of Oman) QATAR NEWS    Qatar Central Bank sold all of the QAR 1.45bn (USD 398mn) of Treasury bills on offer at a monthly auction this week, with yields rising from the last sale. (Source: Reuters) Qatar’s M2 money supply declined by 4.7% YoY at the end of Sep-16 compared to 6% YoY fall at the end of Aug-16. (Source: Gulf Times) Bank credit growth in Qatar rose to 11.7% YoY at the end of Sep-16 while net foreign reserve fell 10.2% YoY for the period. (Source: Gulf Times)    GCC NEWS  1.70 19-Sep Prior 12-Sep Actual 05-Sep Survey 29-Aug Period Sep P 0.90% 0.00% 1.30% 3Q A 0.30% 0.30% 0.30% Oct P 0.10% (0.10%) 0.10% Oct 51.7 51.9 51.5 Oct-28th -- (1.20%) (4.10%) Nov-02nd 0.50% 0.50% 0.50% Nov-03rd 0.25% 0.25% 0.25% Oct-29th 256k 265k 258k Oct 6.30% 6.10% 6.40% Oct-28th -- 391.0b 391.3b Sep F (0.10%) (0.30%) (0.10%) Oct 173k 161k 191k 22-Aug Industrial Prodn MoM GDP SA QoQ CPI EU Harmonized YoY ISM Manufacturing MBA Mort. Applications FOMC Rate Decision Bank of England Rate Initial Jobless Claims CPI YoY Gold and Forex Reserve Durable Goods Orders Chg. in Nonfarm Payrolls 15-Aug Event Japan EC Italy US US US UK US Russia Russia US US 08-Aug Region  Ministry of Energy and Industry announced that starting 1st Nov-16, the cost of one liter of 91-octane petrol will be QAR1.35 per liter, while diesel price will be unchanged. (Source: Doha News) Commercial Bank of Qatar plans to convene its shareholders meet to seek approval to increase its capital by up to 17%. (Source: Reuters) Qatar Petroleum has established a JV- Ocean LNG to market its future LNG portfolio sourced outside the nation. (Source: Gulf Times) Nebras Power’s CEO said that it plans to acquire a 35.5% stake held by France’s Engie in Indonesia's PT Paiton Energy by Dec-16. (Source: Reuters)   Ezdan Holding Group has bought a part of the Speed Trading and Contracting Company’s share in Magical Festival Village Co. raising its stake to 70%. (Source: QSE) Qatar will shift some state-run health and education services to the private sector to ease the burden on its finances, the emir said. (Source: Arabian Business)   The Ministry of Interior signed 11 contracts worth over QAR 260mn during the first two days of the ongoing three-day Milipol Qatar exhibition in Doha. (Source: Qatar Tribune) Barwa Real Estate is raising USD 250mn with maturity of 7 years through an Islamic syndicated loan led by Standard Chartered, banking sources said. (Source: Arabian Business) 1
2. WEEKLY WRAP November 06 , 2016 EQUITY Index Price Index Price WTD %Δ 2,085.2 (1.9) (1.9) 2.0 MSCI EM 880.1 (2.6) (2.8) 10.8 17,888.3 (1.5) (1.4) 2.7 S&P GCC 1,479.6 (1.7) (1.1) 2.3 Nasdaq 4,660.5 (3.0) (2.9) 1.5 Dow Jones Islamic 2,838.5 (1.8) (1.8) 1.4 FTSE 100 6,693.3 (4.3) (3.8) 7.2 KSA (TASI) 6,060.5 2.1 0.8 (12.3) DAX 30 10,259.1 (4.1) (3.8) (4.5) UAE (DFM) 3,298.4 (0.6) (1.0) 4.7 CAC 40 4,377.5 (3.8) (2.9) (5.6) UAE (ADX) 4,281.6 (0.3) (0.4) (0.6) BIST 100 74,267.2 (5.2) (5.4) 3.5 Qatar (DSM) 9,956.0 (4.0) (2.1) (4.5) Nikkei S&P 500 DJIA WTD %Δ MTD %Δ YTD %Δ COMMENTARY MTD %Δ YTD %Δ 16,905.4 (3.1) (3.0) (11.2) Kuwait (KSE) 5,409.4 0.2 0.2 (3.7) Sh. Comp 3,125.3 0.7 0.8 (11.7) Bahrain (BAX) 1,144.4 (0.3) (0.4) (5.9) Hang Seng 22,642.6 (1.4) (1.3) 3.3 Oman (MSM) 5,462.1 (0.6) (0.4) 1.0 Sensex 27,274.2 (2.4) (2.3) 4.4 Jordan (ASEGI) 2,114.1 0.5 0.3 (1.0) Source: Bloomberg GLOBAL INDICES Weekly Performance (%) Sh. Comp Jordan (ASEGI) Hang Seng DJIA S&P 500 Sensex MSCI EM Nasdaq Nikkei CAC 40 DAX 30 FTSE 100 BIST 100 YTD Performance (%) 0.7 0.5 MSCI EM FTSE 100 Sensex BIST 100 Hang Seng DJIA S&P 500 Nasdaq Jordan (ASEGI) DAX 30 CAC 40 Nikkei Sh. Comp (1.4) (1.5) (1.9) (2.4) (2.6) (3.0) (3.1) (3.8) (4.1) (4.3) (5.2) (6.0) (4.0) (2.0) 0.0 10.8 7.2 4.4 3.5 3.3 2.7 2.0 1.5 Source: Bloomberg GCC Most major gulf markets fell over the week on the back of fall in oil prices as hopes for OPEC production cut deal faded. Saudi Arabia’s Index however bucked the trend, rising 2.1% on the back of continued gains in the Banking stocks after last month’s USD 17.5 bn international bond issue by the government. Abu Dhabi’s index edged down 0.3% while Dubai index fell 0.6% over the week. (1.0) (4.5) (5.6) (11.2) (11.7) (20.0) 2.0 (10.0) 0.0 10.0 20.0 Source: Bloomberg GCC INDICES Weekly Performance (%) YTD Performance (%) KSA (TASI) UAE (DFM) 2.1 Kuwait (KSE) 4.7 S&P GCC 0.2 2.3 UAE (ADX) (0.3) Dow Jones Islamic 1.4 Bahrain (BAX) (0.3) Oman (MSM) 1.0 UAE (DFM) (0.6) UAE (ADX) Oman (MSM) (0.6) Kuwait (KSE) S&P GCC (1.7) Qatar (DSM) Dow Jones Islamic (1.8) Bahrain (BAX) Qatar (DSM) (4.0) (0.6) (3.7) (4.5) (5.9) KSA (TASI) (12.3) (4.0) (6.0) (2.0) 0.0 2.0 (15.0) 4.0 Source: Bloomberg (10.0) (5.0) 0.0 5.0 Global Most Global markets fell over the week as heightened uncertainty surrounding the upcoming US election weighed on investor sentiment. US indices fell as investors remain cautious ahead of US election and as falling oil prices weighed on the index. The Energy sector fell as record weekly increase in US crude inventories reignited concerns about an oil glut and forced prices down. Tech-heavy Nasdaq fell 3%, as dismal outlook from Facebook impacted investor sentiment for the Tech shares. Additionally strong US jobs growth and rising wages boosted prospects for December rate hike which added to the pessimism in the market. European stocks fell in tandem with a general global sell-off as polls showed the US presidential race tightening. The PAN European Stoxx 600 index fell 3.5%, with Banking, Automotive, and Energy stocks being the biggest decliners. In Asia, Japan’s Nikkei fell 3.1% as yen gained amid US election fears. China’s index bucked the broader trend and rose 0.7% as a private survey showed signs of economic recovery in the country. 10.0 Qatar QE Index underperformed its regional peers falling 4% during the week amid a slew of disappointing earnings results. Domestic Institutions turned net sellers on the bourse despite assurance from the Emir that the Qatar’s economy remains robust and the infrastructure development projects would continue unhindered. Most sectors fell with major losers being Industrials (-6.7%), Consumer Goods (-6%) and Telecom (-4.9%) sectors. Out of 44 stocks traded, 39 fell, 3 gained, and 2 stayed unchanged. Source: Bloomberg DSM INDEX 12,100 11,100 9,956.0 10,100 9,100 May-16 Jun-16 Index Aug-16 50 SMA 100 SMA Sep-16 200 SMA Nov-16 Indicator Price Last Close 9,956.0 MAVG 50 10,551.9 MAVG 100 10,452.5 MAVG 200 10,167.1 6 Month High 11,408.8 6 Month Low 9,532.6 RSI (14 Days) 25.1 Source: Bloomberg 2
3. WEEKLY WRAP November 06 , 2016 RATES & CREDIT US Treasury (%) Qatar Treasury (%) 3.50 5.00 3.09 3.00 2.50 1.00 0.50 2.56 1.73 2.00 1.50 2.33 2.09 0.89 2.00 3.38 3.06 2.73 3.00 1.78 1.54 4.29 4.00 1.80 4.25 2.60 2.13 1.23 1.00 0.79 1.49 1.00 0.00 0.00 2 Yrs 5 Yrs 7 Yrs 10 Yrs Current Last Year 7 Yrs 10 Yrs 30 Yrs Last Year Source: Bloomberg CDS Qatar Govt. Int. Bonds Price (BPS) WTD Δ (BPS) MTD Δ (BPS) YTD Δ (BPS) Global US 5 Yrs Current Source: Bloomberg 5 Years CDS 2 Yrs 30 Yrs 23.6 (2.9) (3.5) 4.4 Maturity Price (USD) Z Spread (BPS) Yield (%) WTD Δ (USD) YTD Δ (USD) QGIB 2017 100.4 2.9 0.55 (0.0) (1.4) QGS 2018 100.5 65.8 1.49 (0.1) (0.8) QGIB 2019 111.6 56.4 1.54 (0.1) (3.4) QGIB 2020 110.1 86.1 1.88 (0.0) (0.8) Qatari Diar 2020 100.6 100.7 2.20 0.1 NA UK 37.5 (0.3) 0.5 18.7 Germany 20.3 0.9 (0.2) 7.4 France 30.6 (0.3) 1.0 4.2 QGIB 2021 110.4 91.6 1.99 (0.0) (0.0) Italy 147.8 4.3 (5.6) 50.5 QGIB 2022 110.2 111.8 2.34 0.1 0.5 Greece 918.2 (62.3) (99.2) (163.8) QGS 2023 105.5 92.6 2.25 (0.0) 1.7 Russia 237.4 13.7 13.7 (71.6) QGIB 2026 101.6 146.1 3.03 0.2 NA QGIB 2030 164.1 200.8 3.68 (0.1) 6.0 QGIB 2040 135.0 216.6 4.03 (0.3) 8.4 QGIB 2042 126.5 214.4 4.03 (0.6) 9.1 QGIB 2046 105.7 234.1 4.27 (0.1) NA Japan 33.5 0.3 (1.2) (15.1) Turkey 271.8 16.6 18.7 (1.8) Brazil 285.7 11.8 9.9 (209.2) Egypt 459.3 (17.8) (20.4) (19.4) GCC US Swap Rates Abu Dhabi 69.0 2.5 (4.8) (23.5) Bahrain 368.7 0.6 (11.3) 3.1 Dubai 152.7 5.0 (9.8) (81.0) Qatar 90.5 2.0 (4.5) (2.1) Saudi Arabia Source: Bloomberg, QCB 135.0 2.5 (32.2) (20.8) International Credit Spreads Tenor Price (%) Weekly Δ (BPS) YTD Δ (BPS) 3M LIBOR 0.881 (0.005) 0.268 6M LIBOR 1.247 (0.011) 0.401 12M LIBOR 1.560 (0.022) 0.382 2 years 1.034 (0.054) (0.146) 5 years 1.269 (0.080) (0.476) 10 years 1.640 (0.067) (0.549) 30 years 2.013 (0.057) (0.609) iTraxx Europe 76.1 3.1 2.8 76.1 iTraxx Europe Crossover 338.6 8.6 7.6 338.6 Source: Bloomberg CDX North America IG 80.9 3.9 2.1 80.9 Commentary CDX North America HY 434.1 19.8 12.7 434.1 iTraxxSovX CEEMEA NA NA NA NA iTraxx Europe Senior Financial 72.8 3.4 3.4 72.8 iTraxx Europe Sub Financial 125.5 3.8 3.6 125.5 US treasury prices gained, benefitting from the risk-on mode in the market, ahead of the US presidential elections. The gains were however capped as the latest nonfarm jobs report showed the fastest pace of wage gains since June 2009. Wage gains do not bode well for long term treasuries as they stoke inflation, which erodes the value of the fixed payments. Bond prices across Europe fell, on worries that the ECB has reached its limits to continue stimulus. UK’s bonds ended in red over prospects of high inflation and BoE forecast inflation to exceed its 2% target in H1-17. Source: Bloomberg 3
4. WEEKLY WRAP November 06 , 2016 COMMODITIES Commodities Price Commentary Brent (USD/bbl) 45.6 WTI Crude (USD/bbl) 44.1 Oil prices plunged as investors remained skeptical over OPEC’s plan to execute production cuts after several OPEC members asked for exemption. The worries were further escalated on reported news by Reuters that Riyadh threatened to raise oil output steeply to bring prices down if Tehran refused to limit its production. The losses were pared to some extent after OPEC Secretary General dismissed the news. Supply concerns also weighed on the commodity after the IEA reported a record increase in crude stock piles and Baker Hughes data showed a strong increase in US rig count. Encouraging industrial and manufacturing data from China and US, helped copper prices, while demand for safe haven boosted gold. Natural Gas (USD/mmBTU) 2.8 Gold (USD/t oz.) 1,304.5 Silver (USD/t oz.) 18.4 Copper (USD/lb) 226.5 Source: Bloomberg Weekly Performance (%) YTD Performance (%) Copper Silver Gold Brent (8.3) WTI Crude (9.5) Natural Gas (10.9) (12.0) (10.0) Silver Gold Brent Natural Gas WTI Crude Copper 3.3 3.2 2.2 (8.0) (6.0) (4.0) (2.0) 0.0 2.0 33.5 23.0 22.3 19.0 19.0 6.1 0.0 4.0 Source: Bloomberg 10.0 20.0 30.0 40.0 Source: Bloomberg FX Currencies Price Currencies Price GBP/USD 1.2547 USD/INR 66.2075 EUR/USD 1.1171 USD/CNY 6.7565 CAD/USD 0.7460 USD/TRY 3.1568 AUD/USD 0.7673 USD/EGP 15.3774 NZD/USD 0.7326 USD/ZAR 13.5823 103.1200 USD/RUB 64.4471 USD/JPY Commentary USD lost against major currencies, post release of disappointing US service activity data and mounting uncertainty over the outcome of the US presidential elections. The currency pared some losses after non-farm data showed robust growth in wages, thereby boosting expectations of interest rate hike. Hawkish stance by Fed over December rate hike also lent support to the currency. GBP gained 2.7% after BoE dismissed expectations of further rate cuts. Furthermore the ruling by the high court to have Brexit approved from parliament also supported the currency. EGP plunged after Egyptian central bank lifted its currency controls. Source: Bloomberg Weekly Performance (%) GBP NZD ZAR JPY EUR AUD CNY INR CAD TRY RUB EGP YTD Performance (%) JPY ZAR RUB NZD AUD CAD EUR INR CNY TRY GBP EGP 2.7 2.3 1.9 1.6 1.4 1.0 0.2 (0.0) (0.1) (1.6) (2.5) (42.9) (50.0) Source: Bloomberg (40.0) (30.0) (20.0) (10.0) 0.0 10.0 16.6 14.0 13.2 7.2 5.3 3.2 2.6 (0.9) (3.9) (7.6) (15.1) (49.6) (60.0) (50.0) (40.0) (30.0) (20.0) (10.0) 0.0 10.0 20.0 Source: Bloomberg DISCLAIMER It is understood that any opinions expressed by Commercial Bank or its affiliates as to the commentary, market information, and future direction of prices of specific securities reflects the views of the individual analyst who issued them, and not necessarily represent the views of Commercial Bank or its affiliates in any way. In no event shall CBQ or its affiliates have any liability for any direct or indirect losses incurred in connection with any decision made, action or inaction taken by any party in reliance upon the inf ormation provided in this materials or for any delays, inaccuracies, errors in, or omissions of the said information. 4