GCC Daily Market Update - 14 May

Transcription

1. WEEKLY WRAP May 14 , 2017 ECONOMIC UPDATE & NEWS Period Survey Actual Prior Germany Industrial Prodn. SA MoM Mar (0.70%) (0.40%) 1.80% France Industrial Production MoM Mar 1.00% 2.00% (1.70%) 2.60 Italy Industrial Production MoM Mar 0.30% 0.40% 1.00% 2.50 US MBA Mortgage Applications May-05th - 2.40% (0.10%) 2.40 Japan BoP Current Account Bal. Mar 2,593.0b 2,907.7b 2,813.6b UK Industrial Production MoM Mar (0.40%) (0.50%) (0.80%) 2.30 UK Bank of England Bank Rate May-11th 0.25% 0.25% 0.25% US Initial Jobless Claims May-06th 245k 236k 238k 2.10 Russia Gold and Forex Reserve May-05th - 398.8b 401.1b 2.00 US CPI MoM Apr 0.20% 0.20% (0.30%) US Retail Sales Advance MoM Apr 0.60% 0.40% 0.10% US U. of Mich. Sentiment May P 97 97.7 97 Source: Bloomberg UST 10yr Bond 2.20 The US government had USD 182bn budget surplus in Apr-17 compared to a surplus of USD 145.0bn in Mar-17. (Source: Reuters)  US import prices jumped 0.5% MoM in Apr-17 for fifth straight month after an upwardly revised 0.1% MoM gain in Mar-17. (Source: Reuters)  ECB President Draghi said that it was too early for ECB to declare victory in its quest to boost Eurozone inflation despite the recovery of in the bloc. (Source: Reuters)  Independent centrist Emmanuel Macron defeated far-right rival Marine Le Pen, in French Presidential elections. (Source: Reuters)  Australian government announced a 6 bps levy on the deposits of the country's five biggest banks in its annual budget which is expected to raise AUD 6.2bn over the next four years. (Source: Reuters) 08-May 01-May 24-Apr 17-Apr 10-Apr 03-Apr 27-Mar 20-Mar 13-Mar 06-Mar 27-Feb Source: Bloomberg Saudi Arabia government to provide high-speed fibre optic broadband services. (Source: Zawya) GLOBAL NEWS  2.24 20-Feb Event 13-Feb Region  Saudi Arabia's air-conditioning market is expected to grow at the CAGR of ~8.7% for the next five years, making it a SAR 7.0bn market by 2017. (Source: Trade Arabia)  Saudi Arabia and Russia signaled plans to extend oil production cuts into 2018. (Source: Arabian Business)  Saudi Aramco will reduce oil supplies to Asian customers by about 7.0mn barrels in Jun-17. (Source: Zawya)  Central Bank of Bahrain has announced that it is working closely with BENEFIT to launch the first phase of the national electronic wallet, at the end of Jun-17. (Source: Trade Arabia)  Omani commercial banks can lend up to 1.0% of the 5.0% mandated credit to SME’s in the form of non-funded credit, which includes LCs for imports or guarantees for government projects. (Source: Gulf Base)  China's forex reserves rose USD 21.0bn in Apr-17 to USD 3.03tn, compared with an increase of USD 3.9bn in Mar-17. (Source: Reuters)  China's imports rose 11.9% YoY in Apr-17, while exports rose 8.0% in USD terms. (Source: Reuters)   China's PPI rose 6.4% YoY in Apr-17, slower than 7.6% YoY rise in Mar17 as iron ore and coal prices tumbled further. CPI rose 1.2% YoY in Apr-17. (Source: Reuters) Qatar has become the second GCC member state to formally endorse the GCC VAT Framework. (Source: Zawya)  Qatar banks’ total exposure to real estate sector represented around 18.0% of total loans in 2016, S&P Global Ratings said. (Source: The  Japan's inflation-adjusted real wages dropped 0.8% YoY in Mar-17, the biggest decline since Jun-15. (Source: Reuters)   Japan posted current account surplus of JPY 2.9tn in Mar-17 on solid income from overseas investments. (Source: Reuters) Qatar is keen to invest in Bangladesh's LNG and power generation sectors, said Minister of Energy and Industry. (Source: Daily Star)   Turkey's crude steel export production rose 14.1% YoY in Q1-17 as domestic consumption decreased by 10.0%. (Source: AA) Qatar has launched a major Green Car initiative to push more electric cars on the road, aiming to increase electric cars to 10.0% by 2030, said Minister of Energy and Industry. (Source: QNA)  The Cabinet gave directive for taking measures to issue a draft law that specifies regulations for economic zones after the Council of Ministers reviewed Advisory Council's recommendation on it. (Source: Qatar Tribune)  QIB has appointed six banks to arrange for a USD Sukuk issuance. QATAR NEWS Peninsula) GCC NEWS  UAE’s non-oil foreign trade volume, including direct trade and free zones, increased by 0.5% YoY to AED 1.6tn in 2016. (Source: WAM)  Total value of remittances from the UAE reached AED 37.1bn in Q117, with Indian expats topping the list, accounting for 34.9% of the total remittances. (Source: Arabian Business)  Abu Dhabi Fund for Development has allocated funds worth AED 700.0mn for 9 infrastructure development projects in Bangladesh. (Source: WAM)  Dubai based Jebel Ali Free Zone attracted 470 new companies during 2016, registering a CAGR of 7.0% over the previous five years, chairman and CEO of the DP World Group said. (Source: Trade Arabia)  Saudi Arabia and the US are in talks to enter contracts worth USD 10.0bn in arm sales. (Source: Financial Express)  Saudi Telecom Company inked an agreement worth SAR 7.3bn with (Source: The Peninsula)  Moody’s has assigned a first time rating of A1 with stable outlook to QIB’s local and foreign currency deposit. (Source: The Peninsula)  The listing of Investment Holding Group's (IHG) shares on QSE is expected within two weeks, the company said. (Source: Qatar Tribune)  Doha Bank will soon file application for its proposed ETF carrying a fee of 0.5%, one of the lowest in emerging markets offerings. (Source: Gulf Times)  IBQ has hired boutique investment firm Perella Weinberg Partners as a financial adviser to help with a three-way bank merger in Qatar. (Source: Bloomberg) 1
2. WEEKLY WRAP May 14 , 2017 EQUITY Index Price S&P 500 WTD %Δ MTD %Δ YTD %Δ COMMENTARY Index Price WTD %Δ MTD %Δ YTD %Δ 2,390.9 (0.3) 0.3 6.8 MSCI EM 1,002.4 2.5 2.5 16.2 20,896.6 (0.5) (0.2) 5.7 S&P GCC 1,638.9 1.0 0.8 4.3 Nasdaq 5,686.8 0.7 1.8 16.9 Dow Jones Islamic 3,234.1 0.5 1.5 11.3 FTSE 100 7,435.4 1.9 3.2 4.1 KSA (TASI) 6,882.5 (0.6) (1.9) (4.5) (3.1) DJIA DAX 30 12,770.4 0.4 2.7 11.2 UAE (DFM) 3,420.2 0.0 0.2 CAC 40 5,405.4 (0.5) 2.6 11.2 UAE (ADX) 4,608.3 (0.2) 1.9 1.4 BIST 100 94,996.4 1.1 0.4 21.6 Qatar (DSM) 10,110.8 1.7 0.5 (3.1) Nikkei 16.0 19,883.9 2.3 3.6 4.0 Kuwait (KSE) 6,670.5 (1.2) (2.5) Sh. Comp 3,083.5 (0.6) (2.3) (0.6) Bahrain (BAX) 1,307.1 (1.8) (2.1) 7.1 Hang Seng 25,156.3 2.8 2.2 14.3 Oman (MSM) 5,432.1 (0.8) (1.5) (6.1) Sensex 30,188.2 1.1 0.9 13.4 Jordan (ASEGI) 2,158.9 (0.2) (1.2) (0.5) Source: Bloomberg GLOBAL INDICES Weekly Performance (%) Hang Seng MSCI EM Nikkei FTSE 100 BIST 100 Sensex Nasdaq DAX 30 Jordan (ASEGI) S&P 500 CAC 40 DJIA Sh. Comp YTD Performance (%) 2.8 2.5 2.3 1.9 1.1 1.1 0.7 0.4 (0.2) (0.3) (0.5) (0.5) (0.6) (1.0) 0.0 1.0 2.0 (5.0) 3.0 Source: Bloomberg 21.6 BIST 100 Nasdaq MSCI EM Hang Seng Sensex DAX 30 CAC 40 S&P 500 DJIA FTSE 100 Nikkei Jordan (ASEGI) (0.5) Sh. Comp (0.6) 16.9 16.2 14.3 13.4 11.2 11.2 5.0 10.0 15.0 20.0 25.0 Source: Bloomberg GCC INDICES Weekly Performance (%) YTD Performance (%) Qatar (DSM) 1.7 S&P GCC KSA (TASI) (0.6) (3.1) UAE (DFM) (3.1) KSA (TASI) (1.2) (4.5) Oman (MSM) (6.1) Bahrain (BAX) (1.8) (2.0) 1.4 Qatar (DSM) (0.8) Kuwait (KSE) 4.3 UAE (ADX) (0.2) Oman (MSM) 7.1 S&P GCC 0.0 UAE (ADX) 11.3 Bahrain (BAX) 0.5 UAE (DFM) 16.0 Dow Jones Islamic 1.0 Dow Jones Islamic Kuwait (KSE) (1.0) 0.0 1.0 (10.0) (5.0) 2.0 Source: Bloomberg 0.0 5.0 10.0 15.0 The global equity markets witnessed a risk on mode this week, with US volatility index at an all-time low and the MSCI Emerging markets benchmark posting strong gains. US markets were however, gripped by pessimism surrounding president Trump’s ability to pass crucial reforms after he suddenly dismissed the FBI Chief. North Korea’s ambassador to the UK talking tough on nuclear program, along with rumors of another missile test by the country further weighed on sentiments. But the gains in growth focused technology stocks aided Nasdaq, which closed 0.7% in green. EU revising this year’s economic growth rates upwards and expecting the unemployment rate to be the lowest in a decade along with continuation of relief rally post Macron’s election as French president, kept most European benchmarks in green. Asian indices were mostly higher, with Japanese benchmark further benefitting from a weaker yen. Chinese markets, on the other hand remained under pressure, amidst persistent fears of tighter regulations. GCC GCC markets inched lower during the last week. Saudi markets closed 0.6% lower, on the back of disappointing Q1-17 results of some large listed companies towards the end of the week. Heavy selling was witnessed in capital goods and insurance stocks. UAE stocks were mostly lower. Dubai’s Drake & Scull plunged significantly this week, over company’s revised capitalization plans, increase in write downs, and plans to decrease capex. Omani markets slipped, as foreign investors diluted their stakes in the listed companies. 6.8 5.7 4.1 4.0 0.0 Global 20.0 Qatar Qatari markets rebounded during the week and ended above the psychological 10,000 mark, helped by bargain buying, majorly by domestic investors. Trading turnover and volumes were lower during this week, with Banking, Telecom and Industrial sectors accounting for more than 80% of the total volume. Heavy buying interest was seen in Telecom and Industrial sectors. Among the individual stocks, Qatar Islamic Bank rose, amid news that the bank has lent QAR 3.4bn to Gulf Drilling International. Source: Bloomberg Indicator Price 11,500 DSM INDEX Last Close 10,110.8 11,000 MAVG 50 10,303.1 MAVG 100 10,507.4 MAVG 200 10,463.0 6 Month High 11,057.8 6 Month Low 9,636.4 RSI (14 Days) 47.7 10,500 10,110.8 10,000 9,500 Nov-16 Jan-17 Index Feb-17 50 SMA 100 SMA Apr-17 200 SMA Source: Bloomberg 2
3. WEEKLY WRAP May 14 , 2017 RATES & CREDIT US Treasury (%) Qatar Treasury (%) 3.50 5.00 2.99 3.00 1.85 2.00 1.50 2.55 2.00 1.70 1.49 1.21 1.00 0.75 3.18 2.88 2.59 3.00 1.29 1.00 0.50 2.33 2.13 2.50 4.39 4.00 4.26 3.16 1.84 2.26 2.41 5 Yrs 7 Yrs 1.21 0.00 0.00 2 Yrs 5 Yrs 7 Yrs Current 10 Yrs 2 Yrs 30 Yrs Current Last Year Source: Bloomberg 30 Yrs Source: Bloomberg CDS 5 Years CDS 10 Yrs Last Year Qatar Govt. Int. Bonds Price (BPS) WTD Δ (BPS) MTD Δ (BPS) YTD Δ (BPS) Global Maturity Price (USD) Z Spread (BPS) Yield (%) WTD Δ (USD) YTD Δ (USD) QGS 2018 100.4 26.2 1.38 0.0 0.0 QGIB 2019 108.7 32.3 1.73 (0.1) (1.3) QGIB 2020 108.0 51.7 2.07 (0.1) (0.0) Qatari Diar 2020 99.5 67.8 2.44 0.1 1.4 QGIB 2021 108.0 65.8 2.27 0.0 0.5 US 24.3 0.0 (0.5) (2.5) UK 25.5 0.4 (1.3) (5.6) Germany 16.6 (0.4) 0.3 (5.2) France 29.7 (1.4) (3.9) (7.3) QGIB 2022 108.4 71.2 2.53 0.1 1.2 Italy 159.9 1.1 (8.8) 2.7 QGS 2023 103.1 68.2 2.57 0.0 0.8 Greece 673.0 (61.3) (199.0) (374.5) QGIB 2026 100.5 98.9 3.15 (0.1) 3.8 QGIB 2030 161.3 148.0 3.73 0.1 6.3 QGIB 2040 130.4 183.8 4.26 (0.2) 5.2 QGIB 2042 121.6 185.3 4.29 (0.3) 4.8 QGIB 2046 103.8 190.4 4.37 (0.6) 3.5 Russia 155.1 (1.9) 1.5 (76.2) Japan 25.1 (1.0) (0.5) (4.9) Turkey 207.7 2.8 (2.4) (65.5) Brazil 202.9 (12.0) (14.3) (77.8) Source: Bloomberg, QCB Egypt 335.2 (2.0) (9.8) (117.2) US Swap Rates Abu Dhabi 41.4 (0.7) 0.5 (20.1) Bahrain 217.3 1.8 (5.0) (85.1) Dubai 111.0 0.1 (0.7) Qatar 60.3 (1.5) 1.5 GCC Saudi Arabia Tenor 92.4 1.0 4.3 Price (%) Weekly Δ (BPS) YTD Δ (BPS) 3M LIBOR 1.182 0.001 0.184 6M LIBOR 1.439 0.007 0.122 (38.8) 12M LIBOR 1.786 0.007 0.100 (20.0) 2 years 1.536 (0.068) 0.079 5 years 1.915 (0.063) (0.062) 10 years 2.251 (0.040) (0.088) 30 years 2.528 (0.003) (0.067) 6.0 International Credit Spreads iTraxx Europe 63.0 (1.0) (3.9) (9.7) Source: Bloomberg iTraxx Europe Crossover 257.0 (0.9) (10.6) (34.4) Commentary CDX North America IG 62.5 0.0 (1.7) (5.3) CDX North America HY 327.2 1.7 0.9 (26.9) iTraxxSovX CEEMEA NA NA NA NA iTraxx Europe Senior Financial 35.6 (2.6) (4.9) (34.4) iTraxx Europe Sub Financial 41.4 (5.5) (17.9) (83.3) US treasury yields rose earlier in the week, following Emmanuel Macrons victory in French elections which has ignited a general risk on mode in the market. The yields however, retreated later in the week after release of disappointing US retail sales and inflation numbers questioned the number of rate hikes by Fed. European government bond yields ended lower for the week due to ECB President’s dovish comments over tightening monetary policy. Greek government bonds rallied this week as concerns around Eurozone political risk faded and hopes improved for a positive result from Greece’s debt relief talks with creditors. Source: Bloomberg 3
4. WEEKLY WRAP May 14 , 2017 COMMODITIES Commodities Price Commentary Brent (USD/bbl) 50.8 WTI Crude (USD/bbl) 47.8 Oil prices rose for the week as statements from major oil-producing countries suggested that OPEC and non-OPEC supply cuts could be extended into 2018. The prices also rose as EIA reported biggest weekly drop in US inventories during 2017. The prices were slightly pressurized later in the week after Baker Hughes reported 17th straight weekly rise in oil rig count by 9 to 712. Natural gas prices rose for the week as EIA reported that natural gas inventories rose less-than expected. Gold prices ended higher for the week, as prospects of US rate hike were impacted by weaker than expected inflation and core retail sales data. Copper prices ended lower for the week after data showed sharp drop in imports by China. Natural Gas (USD/mmBTU) 3.4 Gold (USD/t oz.) 1,227.7 Silver (USD/t oz.) 16.3 Copper (USD/lb) 251.8 Source: Bloomberg Weekly Performance (%) YTD Performance (%) Natural Gas Gold 4.8 Brent WTI Crude Gold (8.1) Brent 0.1 (10.5) WTI Crude (0.1) (1.0) 0.5 Natural Gas 0.8 Copper 2.2 Copper 3.5 Silver 6.6 Silver 3.5 0.0 1.0 2.0 3.0 4.0 5.0 6.0 (10.9) (15.0) Source: Bloomberg (10.0) (5.0) 0.0 5.0 10.0 Source: Bloomberg FX Currencies Price Currencies Price GBP/USD 1.2920 USD/INR 63.8100 EUR/USD 1.0961 USD/CNY 6.8995 CAD/USD 0.7294 USD/TRY 3.5719 AUD/USD 0.7387 USD/EGP 18.0509 NZD/USD 0.6866 USD/ZAR 13.3638 113.3800 USD/RUB 57.0869 USD/JPY Commentary USD started on a strong note aided by increased prospects of interest rate hike in June-17, cemented by hawkish stance from some Fed officials. The currency however, pared most of its early gains later weighed by weaker-than expected US inflation data and retail sales data for April-17. The currency was also pressurized by Trump’s unexpected dismissal of FBI chief. CAD ended lower as a ratings downgrade for the country's major banks by Moody’s nullified the impact of higher oil prices. An optimistic inflation outlook by BoE governor, pressured GBP, while dovish stance by the ECB president negatively impacted EUR. JPY also ended lower. Source: Bloomberg Weekly Performance (%) YTD Performance (%) RUB ZAR INR EGP CNY CAD (0.4) AUD (0.5) JPY (0.6) EUR (0.6) GBP (0.7) NZD (0.8) TRY (0.8) (1.0) Source: Bloomberg (0.5) RUB INR GBP EUR JPY ZAR AUD CNY EGP NZD TRY CAD 1.5 0.4 0.2 0.2 0.0 0.0 0.5 1.0 1.5 2.0 7.6 5.9 4.5 3.9 3.2 2.8 2.5 0.9 0.4 (1.0) (1.3) (2.0) (4.0) (2.0) 0.0 2.0 4.0 6.0 8.0 10.0 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, errors in, or omissions of the said information. 4