MENA Daily Fixed Income Report - 5 January

Transcription

1. MENA Daily Fixed Income Report – 5 January 2021 Kuwait Financial Centre “Markaz” News Updates Gulf Thaw May Boost Qatar’s Non-Oil Economy, Fitch Says – A resolution of the dispute between Qatar and its Gulf neighbors is expected to bolster prospects for the gas-rich nation’s non-oil economy over the medium term, according to Fitch Ratings. “A resumption of travel links will eventually lift tourism inflows, and greater interest from regional buyers could support the real estate market, which has been in a multi-year downturn,” the ratings agency said in a note. Saudi Arabia planned to open its land, air and sea borders with Qatar on Monday, the eve of a regional leaders’ summit in the kingdom. The step came amid efforts to resolve the dispute that’s split Qatar from its neighbors since 2017. Fitch also said: Qatar’s high leverage will remain a key rating constraint. It expects general government debt-to-GDP ratio to reach 76% in 2020, up from 60% in 2017. Contingent liabilities are large, especially those from local banks. Lenders’ net foreign liabilities rose to a $130 billion, or 70% of GDP, in 2019. The government’s asset position mitigates some of the risks from high indebtedness; Fitch estimates sovereign net foreign assets at 137% of GDP in 2019. Qatar will post “a roughly balanced budget” in 2020, including estimated investment income from Qatar Investment Authority assets. (Source: Bloomberg) Emirates NBD Hires Banks for Senior USD 5Y Regs Bond – Emirates NBD Bank has mandated Emirates NBD Capital, ICBC, ING, Mizuho Securities and Standard Chartered Bank as joint lead managers and bookrunners to arrange a global investor conference call on Jan. 5. A benchmark fixed rate USD Regulation S senior unsecured bond under ENBD’s U.S.$ 12.5b EMTN program will follow, subject to market conditions. FCA/ICMA stabilization applies. Emirates NBD is rated A+ (stable) by Fitch and A3 (negative) by Moody’s; it is 55.8% owned by the Investment Corp. of Dubai, the principal investment arm of the Government of Dubai (Source: Bloomberg) Fed’s Mester Says Policy Should Hold Steady in Coming Months – The U.S. economy will require steady, continued support from monetary and fiscal policy throughout 2021 as it faces a bleak winter before reaching a vaccine-driven, mid-year rebound, according to Federal Reserve Bank of Cleveland President Loretta Mester. “A slowdown in the economy in the first part of the year along the lines I am expecting would not require a change in monetary policy so long as the medium-run outlook remains intact,” Mester said in the text of remarks she’s set to deliver Monday evening. “Nor would the strengthening in growth I expect to see later this year necessitate a change in our policy stance because I expect that the economy will still be far from our employment and inflation goals,” she added. (Source: Bloomberg) GCC Sovereign Yields Sovereigns Maturity Sovereign Ratings Price ∆ (YTD %) -0.05 KSA 2025 1.17 Price ∆ (YTD %) -0.01 0.05 KSA 2030 2.04 -0.09 KSA A1 A-u A -0.56 KSA 2050 3.32 -1.08 UAE Aa2 NR AA- 0.14 Oman 2025 4.09 0.13 AA AA Oman 2029 5.37 0.30 Abu Dhabi Aa2 0.09 Qatar Aa3 AA- AA- 6.08 0.30 Oman 2048 6.69 0.53 2.54 0.03 Qatar 2025 0.86 0.00 Bahrain B2 B+ B+ Oman Ba3 B+ BB- Egypt B2 B B+ Lebanon C SD RD Jordan B1 B+ BB- Turkey B2 B+u BB- Tunisia B2 NR Yield % Abu Dhabi 2025 0.78 Abu Dhabi 2030 1.57 Abu Dhabi 2050 2.77 Bahrain 2026 3.25 Bahrain 2030 4.74 Bahrain 2047 Dubai 2029 Sovereigns Maturity Yield % Kuwait 2022 0.17 -0.09 Qatar 2030 1.65 -0.24 Kuwait 2027 1.14 -0.24 Qatar 2050 2.87 -0.74 Bonds and Sukuk Indices Yield % Duration (yrs) 1D ∆ (%) YTD ∆ (%) Bloomberg GCC FI Index 2.46 8.08 -0.11 -0.11 S&P MENA Bond and Sukuk Index 2.03 NA -0.19 -0.18 Bloomberg Emerging Markets USD Index 3.49 6.80 0.02 0.02 Bloomberg Global Aggregate Index 0.83 7.42 0.15 0.15 Index Name Interbank Rates (%) 3 Months 5/1/2021 31/12/2020 1.4375 1.4375 0.8163 0.8175 2.2500 2.2500 0.9550 1.1206 0.4500 0.5125 -0.5450 -0.5450 0.2384 0.2384 KIBOR SAIBOR BHIBOR QATAR AEIBOR EURIBOR LIBOR 6 Months 5/1/2021 31/12/2020 1.6875 1.6875 0.8688 0.8700 2.5333 2.5333 1.0548 1.1960 0.5321 0.4908 -0.5260 -0.5260 0.2576 0.2576 USD Swap Rates 1-Year 2-Year 5-Year 7-Year 10-Year 30-Year Yield % 0.1863 0.1900 0.4218 0.6481 0.9195 1.4085 Currencies 1D ∆ (bps) 0.05 0.17 0.57 0.55 0.55 0.78 YTD ∆ (%) -3.2 -3.9 -1.9 -1.0 -0.6 0.5 US Treasuries 2-Year 5-Year 10-Year 30-Year 12 Months 5/1/2021 31/12/2020 1.9375 1.9375 0.9400 0.9413 2.6833 2.6833 1.3532 1.3636 0.6427 0.6538 -0.4990 -0.4990 0.3419 0.3419 KWD SAR BHD QAR OMR AED USD 0.3033 3.7516 0.3770 3.6421 0.3850 3.6731 UK Guilts Yield % 0.12 0.35 0.92 1.67 1D ∆ (%) 0.00 -0.02 -0.05 -0.21 Yield % -0.18 -0.11 0.17 0.73 1D ∆ (bps) 0.0000 0.0000 0.0027 -0.0082 0.0000 0.0000 YTD ∆ (%) 0.00 0.01 0.01 -0.01 0.00 0.00 German Bunds 1D ∆ (%) -0.02 0.07 0.24 0.46 Yield % -0.74 -0.78 -0.66 -0.20 1D ∆ (%) -0.02 0.06 0.29 1.13 Moody’s S&P Kuwait A1 AA- Fitch AA B Morocco Ba1 BBB- BB+ US Aaa AA+u AAA UK Aa2 AAu AA- China A1 A+ A+ USD 5Yr CDS 5-Jan 2021 31-Dec 2020 Kuwait 40.70 36.700 KSA 64.84 56.915 Abu Dhabi 36.86 36.090 Dubai 97.35 91.005 Qatar 37.81 36.705 Bahrain 218.67 175.995 Oman 334.59 234.400 Iraq 541.16 383.680 Egypt 305.66 277.420 Morocco 98.68 91.435 Turkey 303.55 282.130 US 11.59 10.810 UK 14.38 16.210 China 27.74 31.205 Japan 14.21 21.042 Germany 9.26 7.080 France 14.64 16.130 Source: Bloomberg This report has been prepared and issued by Kuwait Financial Centre K.P.S.C. (Markaz) , which is regulated by the Capital Markets Authority and the Central Bank of Kuwait. The report is owned by Markaz and is privileged and proprietary and is subject to copyrights. Sale of any copies of this report is strictly prohibited. This report can not be published. A number of sources which include Bloomberg, Zawya, and daily newspapers were utilized in the creation of this report.