GCC Daily Market Update - 9 October

Transcription

1. WEEKLY WRAP October 09 , 2016 ECONOMIC UPDATE & NEWS (0.40%) France CPI YoY Sep P 0.40% 0.40% 0.20% UK GDP QoQ 2Q F 0.60% 0.70% 0.60% UK GDP YoY 2Q F 2.20% 2.10% 2.20% Italy CPI EU Harmonized YoY Sep P 0.10% 0.10% (0.10%) US ISM Manufacturing Sep 50.4 51.5 49.4 Russia CPI YoY Sep 6.50% 6.40% 6.90% US Initial Jobless Claims Oct-01st 256k 249k 254k Russia Gold and Forex Reserve Sep-30th -- 397.7b 398.0b France Industrial Production MoM Aug 0.60% 2.10% (0.50%) US Change in Nonfarm Payrolls Sep 172k 156k 167k Source: Bloomberg  Gross debt in the global non-financial sector reached USD 152tn (225% of world GDP) in 2015, and is still following a rising trend, IMF said. (Source: Bloomberg)  The IMF maintained global growth forecast at 3.1% and 3.4% for 2016 and 2017 respectively, stating that a drop in US growth for 2016 would be offset by strength in Japan, Germany, Russia, India and some other emerging markets. (Source: Reuters) Bahrain launched a USD 2bn bond comprising of a seven-year USD 1bn sukuk priced at 5.6% and a 12-year USD 1bn conventional bond priced at 7%. (Source: Arabian Business)  Kuwait’s Ministries of Health and Interior are expected to introduce a mandatory health insurance plan for all visitors arriving on commercial visit visas. (Source: Arabian Business)  Kuwait’s exports were down 25.8% QoQ to KWD 3.5bn in Q2-16, while trade volume fell 17.6% QoQ. (Source: Arab Times Online) US nonfarm payrolls rose by 156,000 in Sept-16, down from a gain of 167,000 in Aug-16. The unemployment rate rose by 10 bps to 5.0% for the same period. (Source: Reuters)  US retail sales fell 0.1% MoM in Aug-16, as sales of food, drinks and tobacco products fell 0.4% MoM, while discretionary spending on non-food products were down by 0.1% MoM. (Source: Reuters) Federal Reserve Vice Chairman said that low level of natural rate of interest may reflect more than just cyclic forces, signaling a prolonged low growth phase in the economy. (Source: Reuters)  Eurozone producer prices fell 0.2% MoM in Aug-16, entirely due to energy providers, who cut prices by 0.8%. But excluding the energy sector, producer prices were flat In Aug-16. (Source: WSJ)  Moody's raised its forecasts for Japan’s real GDP growth to 0.7% in 2016, as low economic growth and inflation prompted a shift toward greater monetary and fiscal accommodation. (Source: Moody’s)  The Reserve Bank of India reduced the policy repo rate by 25 bps from 6.50% to 6.25%, as retail inflation dropped to a five-month low of 5.05% in August-16. (Source: RBI) GCC NEWS   Source: Bloomberg The total assets of Islamic banks and windows in Oman amounted to OMR 2.7bn at the end of July-16 while total deposits held with them rose to OMR 1.9bn during the period. (Source: Zawya)   1.671  GLOBAL NEWS  1.75 1.70 1.65 1.60 1.55 1.50 1.45 1.40 1.35 03-Oct 1.50% 26-Sep 0.50% 19-Sep Aug P 12-Sep Industrial Production MoM UST 10yr Bond 05-Sep Japan Prior 29-Aug 3.00% 22-Aug 3.10% 15-Aug Actual 3.00% 08-Aug Survey Aug 01-Aug Period 25-Jul Jobless Rate 18-Jul Event Japan 11-Jul Region The UAE leads the GCC in the Global Islamic Economy Indicator (GIEI), a measure representing the overall health and growth of the Islamic economy across 73 countries. (Source: Gulf News) QATAR NEWS  Qatar's foreign trade surplus shrank by 35.7% YoY to QAR 8.6bn (USD 2.bn) in August-16 because of low natural gas and oil prices. Exports of petroleum gases and other gaseous hydrocarbons fell 23.9% YoY. (Source: Arabian Business)  Qatar’s population was 6.3% higher at 2.55mn in September-16 against 2.40mn in August-16 as a result of the return of many of the country's residents after the summer holidays and newly recruited workers. (Source: Gulf Times)  Qatar was ranked 18th among 138 countries in the World Economic Forum’s (WEF) latest Global Competitiveness Report, but was ranked 1st in terms of government budget balance, gross national savings and inflation rates (Source: The Peninsula)  Qatargas and Pakistan-based Global Energy Infrastructure Limited signed a 20-year LNG Sale and Purchase Agreement to supply 1.3mn tons per annum of LNG to Pakistan for 20 years. (Source: The Peninsula)  Qatar is expected to introduce VAT between January-18 and January19, audit firm BDO Qatar said, which will present significant challenges for the local government authorities. (Source: Gulf Times)  The Qatar Central Bank is working to advance its systems and program that will further stimulate the growth of insurance sector, QCB Governor said. (Source: The Peninsula) The Emirates NBD Saudi Arabia PMI fell to 55.3 in Sept-16 from 56.6 in Aug-16 majorly due to austerity measure imposed. (Source: The National)   Saudi Arabia's central bank has given commercial banks instructions to reschedule consumer loans of customers hit by recent cuts in government spending due to low oil prices. (Source: Reuters) Qatar’s Prime Minister promised to back and extend all support to the private sector, whose role has been positive in the country’s economy. (Source: Gulf Times)   Saudi Arabia welcomed an agreement reached in Algiers last week on restraining oil output, and hoped for further co-operation between oil producers inside and outside OPEC. (Source: Arabian Business) The total number of transactions by the Ministry of Interior rose by 27.3% YoY to 41,293,748 in H1-16, while transactions completed through the General Directorate of Nationality, Borders and Expats Affairs rose by 9.6% YoY to 20,982,263 in H1-16. (Source: Gulf Times)  Saudi Arabia's government decided to extend the license of telecom companies for 15 years and launched unified licenses, which will allow telecom players to offer all services. (Source: Arabian Business)  Qatar received 2.18mn visitors from January-16 to September-16, while overall arrivals from the GCC region grew by 7% YoY. (Source: The Peninsula) 1
2. WEEKLY WRAP October 09 , 2016 EQUITY Index Price Index Price WTD %Δ 2,153.7 (0.7) (0.7) 5.4 MSCI EM 914.8 1.3 1.3 15.2 18,240.5 (0.4) (0.4) 4.7 S&P GCC 1,498.7 (1.5) (1.5) 3.6 Nasdaq 4,864.5 (0.2) (0.2) 5.9 Dow Jones Islamic 2,957.9 (0.7) (0.7) 5.6 FTSE 100 7,044.4 2.1 2.1 12.8 KSA (TASI) 5,631.3 0.1 0.1 (18.5) DAX 30 10,490.9 (0.2) (0.2) (2.3) UAE (DFM) 3,354.6 (3.4) (3.4) 6.5 CAC 40 4,449.9 0.0 0.0 (4.0) UAE (ADX) 4,389.6 (1.9) (1.9) 1.9 BIST 100 77,976.0 1.9 1.9 8.7 Qatar (DSM) 10,357.3 (0.7) (0.7) (0.7) Nikkei S&P 500 DJIA WTD %Δ MTD %Δ YTD %Δ COMMENTARY MTD %Δ YTD %Δ 16,860.1 2.5 2.5 (11.4) Kuwait (KSE) 5,320.2 (1.4) (1.4) (5.3) Sh. Comp 3,004.7 0.0 0.0 (15.1) Bahrain (BAX) 1,137.1 (1.1) (1.1) (6.5) Hang Seng 23,851.8 2.4 2.4 8.8 Oman (MSM) 5,610.0 (2.0) (2.0) 3.8 Sensex 28,061.1 0.7 0.7 7.4 Jordan (ASEGI) 2,104.9 (0.7) (0.7) (1.5) Source: Bloomberg GLOBAL INDICES Weekly Performance (%) YTD Performance (%) 2.5 2.4 2.1 1.9 Nikkei Hang Seng FTSE 100 BIST 100 MSCI EM Sensex CAC 40 Sh. Comp DAX 30 (0.2) Nasdaq (0.2) DJIA (0.4) S&P 500 (0.7) Jordan (ASEGI) (0.7) (1.0) MSCI EM FTSE 100 Hang Seng BIST 100 Sensex Nasdaq S&P 500 DJIA Jordan (ASEGI) DAX 30 CAC 40 Nikkei (11.4) Sh. Comp (15.1) 1.3 0.7 0.0 0.0 1.0 2.0 (20.0) 3.0 Source: Bloomberg 15.2 12.8 8.8 8.7 7.4 5.9 5.4 4.7 (1.5) (2.3) (4.0) (10.0) 0.0 10.0 20.0 Source: Bloomberg GCC INDICES Weekly Performance (%) YTD Performance (%) KSA (TASI) UAE (DFM) 0.1 Dow Jones Islamic Qatar (DSM) Bahrain (BAX) Dow Jones Islamic (0.7) Oman (MSM) 3.8 S&P GCC 3.6 (1.1) (1.4) UAE (ADX) S&P GCC (1.5) Qatar (DSM) UAE (ADX) (1.9) Kuwait (KSE) Oman (MSM) (2.0) Bahrain (BAX) 5.6 1.9 (0.7) (5.3) (6.5) KSA (TASI) (18.5) (3.4) (4.0) 6.5 (0.7) Kuwait (KSE) UAE (DFM) Global Global stocks ended on a mixed note over the week. US Indices fell, as stronger than expected manufacturing and services PMI data along with a modest payroll report strengthened the case for interest rate hike before the year end. Hawkish comments from Fed officials further fueled the sell-off. S&P 500 fell 0.7% dragged down by high dividend paying utilities and telecommunication stocks, while energy and financial stocks offset the slide. The pan-European benchmark Stoxx Europe 600 ended the week lower, following weak business growth numbers and lower retail sales data. FTSE 100 rose 2.1% as the continuing slump in the pound boosted the exporters. In Asia, Japan’s Nikkei edged up 2.5% as yen weakened versus the US dollar. (3.0) (2.0) (1.0) 0.0 (20.0) (15.0) (10.0) (5.0) 1.0 Source: Bloomberg 0.0 5.0 10.0 GCC Most Gulf indices closed lower for the week amid renewed selling pressure ahead of the third quarter results. Saudi Arabia’s Index bucked the broader trend and rose 0.1% mainly lifted by Petrochemical shares on the back of recovery in crude oil prices. Additionally, markets were also boosted by the gains in telecom stocks on government’s announcement of reform measures which will open the industry to more competition, potentially reducing the dominance of market leader Saudi Telecom. Dubai’s benchmark underperformed regional indices, dropping to a new three-month low, led by Dar Al Takaful (-3%) and Dubai Islamic Insurance. Qatar QE index fell 0.7% over the week amid heavy sell off in large cap equities despite the Prime Minister reiterating the government’s support to the private sector. High sell-off was observed in Transport (- 1.9%), Insurance (-1.8%) and Telecom (1.5%) sectors. Individual investors and domestic institutions were the net sellers on the bourse. In terms of volume, Telecom, Banking and Industrials stocks together constituted more than 73% of the total traded. Out of 43 stocks traded, 26 fell, 15 gained, and 2 stayed unchanged. Source: Bloomberg DSM INDEX Indicator Price Last Close 10,357.3 MAVG 50 10,755.5 10,000 MAVG 100 10,335.6 9,000 MAVG 200 10,133.7 6 Month High 11,408.8 6 Month Low 9,532.6 RSI (14 Days) 39.5 12,000 11,000 8,000 Apr-16 10,357.3 May-16 Index Jul-16 50 SMA 100 SMA Aug-16 200 SMA Oct-16 Source: Bloomberg 2
3. WEEKLY WRAP October 09 , 2016 RATES & CREDIT US Treasury (%) Qatar Treasury (%) 3.50 5.00 2.92 3.00 2.50 3.00 2.09 1.78 2.00 3.00 2.45 0.83 0.50 2.00 1.72 1.55 1.26 0.00 0.00 2 Yrs 5 Yrs 7 Yrs 10 Yrs 1.96 Current 1.32 0.80 2 Yrs 30 Yrs 2.51 1.25 1.00 0.64 5 Yrs 7 Yrs Current Last Year Source: Bloomberg 3.96 2.31 2.12 1.40 1.50 1.00 4.19 4.00 10 Yrs 30 Yrs Last Year Source: Bloomberg CDS Qatar Govt. Int. Bonds Maturity Price (USD) Z Spread (BPS) Yield (%) WTD Δ (USD) YTD Δ (USD) Global QGIB 2017 100.6 (0.1) 0.43 (0.0) (1.2) US 26.7 0.2 1.4 7.5 QGS 2018 100.7 51.4 1.54 NA NA UK 35.3 1.6 2.1 16.1 QGIB 2019 112.1 49.8 1.50 (0.3) (2.9) QGIB 2020 110.4 78.7 1.85 (0.2) (0.4) Qatari Diar 2020 100.5 101.8 2.22 (0.4) NA 5 Years CDS Price (BPS) WTD Δ (BPS) MTD Δ (BPS) YTD Δ (BPS) Germany 18.8 (1.6) 2.6 5.9 France 28.7 (0.8) 1.5 2.4 QGIB 2021 110.7 84.9 1.95 (0.3) 0.3 Italy 147.1 (4.4) 14.1 49.9 QGIB 2022 110.8 102.9 2.26 (0.5) 1.1 1,023.0 5.9 (1.5) (59.0) QGS 2023 105.9 87.5 2.17 (0.5) 2.2 QGIB 2026 101.5 154.5 3.04 (0.6) NA QGIB 2030 164.6 207.1 3.66 (1.0) 6.7 QGIB 2040 136.3 220.5 3.96 (2.4) 9.7 QGIB 2042 128.5 215.0 3.93 (2.1) 10.9 QGIB 2046 107.2 236.7 4.18 (2.8) NA Greece Russia 222.3 2.2 25.4 (86.7) Japan 34.0 0.4 2.5 (14.6) Turkey 249.3 (7.1) 14.3 (24.3) Brazil 270.9 3.3 25.9 (224.0) Egypt 479.8 79.8 84.1 1.0 GCC Source: Bloomberg, QCB US Swap Rates Abu Dhabi 69.0 (5.0) 0.0 (23.6) Tenor Bahrain 386.1 1.7 25.8 20.5 Dubai 158.7 (2.4) 6.6 Price (%) Weekly Δ (BPS) YTD Δ (BPS) 3M LIBOR 0.872 0.018 0.259 (75.0) 6M LIBOR 1.262 0.023 0.416 12M LIBOR 1.581 0.029 0.403 2 years 1.068 0.055 (0.111) 5 years 1.269 0.088 (0.476) 10 years 1.556 0.101 (0.632) 30 years 1.893 0.113 (0.729) Qatar 90.3 (4.7) 1.3 (2.3) Saudi Arabia 157.6 (11.4) 12.6 1.8 International Credit Spreads iTraxx Europe 73.9 0.7 0.7 73.9 iTraxx Europe Crossover 333.3 (1.3) (1.3) 333.3 Source: Bloomberg CDX North America IG 74.3 (1.8) (1.8) 74.3 Commentary CDX North America HY 400.7 0.9 0.9 400.7 iTraxxSovX CEEMEA NA NA NA NA iTraxx Europe Senior Financial 73.5 (7.9) (7.9) 73.5 iTraxx Europe Sub Financial 129.8 (16.4) (16.4) 129.8 US treasury yields gained during the week as an upbeat US manufacturing data and higher service sector activity boosted prospects of an interest rate hike. The yields were further boosted by hawkish comments from senior Fed officials throughout the week. The less than expected increase in non-farm payrolls had little impact on the yields as details of reports were more supportive with hourly earnings growing at a decent pace. Yields for ECB government bonds rose amidst reports that ECB might scale back its bond purchases, despite ECB officials denying the same. Source: Bloomberg 3
4. WEEKLY WRAP October 09 , 2016 COMMODITIES Commodities Price Commentary Brent (USD/bbl) 51.9 WTI Crude (USD/bbl) 49.8 Oil prices closed higher for the week supported by data showing a huge drawdown in US crude stockpiles for the fifth straight week. The gains were further powered after Algerian Energy Minister reportedly said that OPEC could cut production at its late-November meeting by 1% more than the amount agreed in August. Gains were however capped after Baker Hughes data showing an addition of 3 new rigs this week. Natural gas prices rallied after weather reports suggested warm weather, raising demand prospects. Copper fell on demand concerns following fresh curbs on China's property market. Gold posted largest weekly loss in 3-years as it lost 4.9% amidst a risk on mode and an increased likelihood of Fed rate hike in December. Natural Gas (USD/mmBTU) 3.2 Gold (USD/t oz.) 1,248.9 Silver (USD/t oz.) 17.6 Copper (USD/lb) 216.4 Source: Bloomberg Weekly Performance (%) YTD Performance (%) 9.9 Brent 39.3 Natural Gas 5.8 35.7 34.5 3.3 Copper Silver (2.1) 27.3 (4.9) Silver 17.8 Copper (9.5) (15.0) (10.0) (5.0) 0.0 5.0 10.0 15.0 1.3 0.0 Source: Bloomberg 10.0 20.0 30.0 40.0 50.0 Source: Bloomberg FX Currencies Price Currencies Price GBP/USD 1.2464 USD/INR 66.1850 EUR/USD 1.1231 USD/CNY 6.6718 CAD/USD 0.7521 USD/TRY 3.0510 AUD/USD 0.7582 USD/EGP 8.8774 NZD/USD 0.7156 USD/ZAR 13.8720 102.9800 USD/RUB 62.3160 USD/JPY Commentary The USD gained against most of its peers as upbeat US economic data during the week boosted prospects of interest rate hike. CAD started on a weak note, majorly due to strength in USD, however recouped much of the losses following higher than expected increase in jobs added, upbeat exports and gain in oil prices. RUB also gained, benefitting from higher oil prices. EUR closed lower as data showed weak business activity; however losses were capped on rumors that the ECB will scale back its bond purchases sooner than expected. GBP plunged 4.1% during the week as UK’s PM charted a timeline for formal Brexit negotiations. Source: Bloomberg Weekly Performance (%) RUB EGP INR EUR CNY AUD ZAR CAD JPY TRY NZD GBP YTD Performance (%) RUB JPY ZAR NZD CAD AUD EUR INR CNY TRY EGP GBP 0.9 0.1 (0.1) (0.3) (0.5) (1.1) (1.1) (1.3) (1.6) (1.7) (1.8) (4.1) (5.0) Source: Bloomberg (4.0) (3.0) (2.0) (1.0) 0.0 1.0 2.0 17.2 16.8 11.5 4.8 4.1 4.1 3.1 (0.6) (3.0) (4.4) (11.7) (15.6) (20.0) (15.0) (10.0) (5.0) 0.0 5.0 10.0 15.0 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 information provided in this materials or for any delays, inaccuracies, erro rs in, or omissions of the said information. 4