GCC Daily Market Update - 16 July

Transcription

1. WEEKLY WRAP July 16 , 2017 ECONOMIC UPDATE & NEWS Jun 2.00% 2.10% Jobless Claims Change Jun - 5.9k 7.7k Canada BoC Rate Decision Jul-12th 0.75% 0.75% 0.50% France CPI YoY Jun F 0.70% 0.70% 0.70% US Initial Jobless Claims Jul-08th 245k 247k 250k Russia Gold and Forex Reserve Jul-07th - 410.9b 412.2b Japan Industrial Production MoM May F - (3.60%) (3.30%) Italy CPI EU Harmonized YoY Jun F 1.20% 1.20% 1.20% US CPI MoM Jun 0.10% 0.00% (0.10%) US U. of Mich. Sentiment Jul P 95.0 93.1 95.1 Source: Bloomberg GLOBAL NEWS 2.22 17-Apr 2.10% 10-Jul PPI YoY UK 03-Jul Japan 2.35 2.30 2.25 2.20 2.15 2.10 2.05 2.00 26-Jun May ¥1,792.8b ¥1,653.9b ¥1,951.9b 19-Jun BoP Current A/c. Balance 12-Jun Japan UST 10yr Bond 05-Jun (3.10%) 29-May Prior (3.60%) 22-May Actual 1.70% 15-May Survey May 08-May Period Machine Orders MoM 01-May Event Japan 24-Apr Region Source: Bloomberg  Dubai’s total number of residential transactions declined 23.0% QoQ in Q2-17 as the sales of off-plan properties fell by 28.0% in terms of volume and by as much as 43.0% in value, according to Chestertons MENA report. (Source: Arabian Business)  US Fed Chair Janet Yellen, in prepared remarks to Congress said that the rates are close to a "neutral" level and not in need of a significant move higher. (Source: CNBC)   US total consumer borrowing rose by USD 18.4bn in May-17, which implies an annual rate of 5.8% in May-17, as revolving and nonrevolving credit surged up by 8.7% and 4.7%, respectively. (Source: The Saudi Ministry of Finance (MoF) will issue sukuk during July-17 in accordance with the fiscal balance program, said Saudi minister of finance. (Source: Mubasher)  Kuwait's real estate market sales went up 37.0% YoY in May-17 to KWD 289.0mn (USD 951.0mn) as investment and residential sectors sales climbed 38.0% and 23.0% YoY, according to National Bank of Kuwait (NBK) report. (Source: Trade Arabia)  Bahrain Defense Force (BDF) will buy USD 22.5bn worth of Sniper Advanced Targeting Pods (ATP) for its F-16 fleet from Lockheed Martin, with deliveries expected to begin by 2018. (Source: Trade Arabia) Market Watch)  The Bank of Canada raised its benchmark interest rate to 0.75% from 0.50%, amidst expectations of stronger economic growth this year. (Source: Financial Post)  Eurozone industrial output grew 1.3% MoM in May-17 as production of capital goods and durable consumer goods grew 2.3% and 1.8%, respectively.(Source: Morningstar)  UK retail sales grew 1.2% YoY in June-17 on a like-for-like basis driven by consumer spending on summer clothing and beauty products. (Source: Market Insider)  UK trade deficit widened to GBP 2.3bn in May-17 as exports fell by GBP 2.1bn while imports fell by GBP 1.6bn. (Source: BBC)  Japan’s current account surplus reached JPY 1,653.9bn in May-17. Trade balance showed a deficit of JPY 115.1bn as imports were up 15.8% YoY, while exports rose 12.9%. (Source: Morningstar)  China's PPI rose 1.5% YoY in June-17. Retail inflation rose 1.5% YoY, aided by 2.2% rise in non-food prices. (Source: Morningstar)  China’s trade balance stands at USD 42.8bn in June-17 as its exports rose to 11.3% and imports increased 17.2% YoY. (Source: CNBC)  Turkey's retail sales rose 0.3% MoM in May-17 supported by a 3.2% rise in automotive fuel sales. (Source:Mt5) GCC NEWS     UAE government plans to exempt residential property and undeveloped land, along with some financial services and local transport from the 5.0% VAT which will be introduced from 1st January-18. (Source: Trade Arabia) QATAR NEWS  The CPI surged 0.7% MoM in June-17 led by increase in the prices of Food & beverages and the Recreation & culture that was up 2.5% and 2.3% over the month respectively. (Source: The Peninsula)  Non-oil exports increased by 12.2% MoM to QAR 1.5bn in May-17. Over the five months of 2017, the non oil exports stood at QAR 7.8bn. UAE was the top non-oil exports destination. (Source: Gulf Times)  Consumer spending is expected to expand 3.2% in 2017 against 2.8% in 2016 despite the current diplomatic rift with its regional peers, according to BMI. (Source: Gulf Times)  Real estate transactions worth QAR 530.7mn were conducted for the period from 4th July-17 to 6th July-17. The types of real estate traded ranged from plots of land, houses to residential compounds and multipurpose buildings. (Source: Qatar Tribune)  Qatar Central Bank Governor said that it has USD 40.0bn in cash reserves plus gold and Qatar Investment Authority has USD 300.0bn in reserves, which are sufficient to withstand financial shocks. (Source: Qatar Tribune)  Moody’s has affirmed QIIB’s rating to A2 in 2017. Moody’s expect the bank’s performance to be relatively resilient due to solid retailfocused franchise, stock of liquid assets and high capital buffers. (Source: The UAE governmental e-Dirham services revenue rose by 25.0% YoY in Q2-17 to AED 2.5bn. The system registered a total of 10.8mn transactions in Q2-17. (Source: Mubasher)  Emirates NBD Dubai Economy Tracker rose to 56.5 in June-17 from 55.0 in May-17 led by improvements in the overall business conditions. (Source: Trade Arabia) Qatargas has urged its supplier to set up full-fledged local operations in Qatar in an order to shield the country from further economic sanctions. (Source: Reuters)  Manateq (Economic Zones Company) has earmarked more than QAR 30.0bn investments to develop three zones Ras Abu Fontas, Umm Al Houl and Al Karaana, to supporting the private sector, said Manateq chief executive. (Source: Gulf Times) Dubai’s non-oil foreign trade grew 2.7% YoY in Q1-17 to AED 327.0bn (USD 87.0bn). Imports accounted for AED 201.0bn while exports reached to AED 35.0bn. (Source: Trade Arabia) The Peninsula) 1
2. WEEKLY WRAP July 16 , 2017 EQUITY Index Price S&P 500 WTD %Δ MTD %Δ YTD %Δ COMMENTARY Index Price WTD %Δ MTD %Δ YTD %Δ 2,459.3 1.4 1.5 9.8 MSCI EM 1,047.1 4.4 3.6 21.4 21,637.7 1.0 1.3 9.5 S&P GCC 1,645.9 4.3 4.5 4.7 Nasdaq 5,838.1 3.2 3.4 20.0 Dow Jones Islamic 3,327.7 2.2 1.8 14.5 FTSE 100 7,378.4 0.4 0.9 3.3 KSA (TASI) 7,313.4 1.5 (1.5) 1.4 DAX 30 12,631.7 2.0 2.5 10.0 UAE (DFM) 3,537.4 4.0 4.3 0.2 CAC 40 5,235.3 1.8 2.2 7.7 UAE (ADX) 4,518.1 2.8 2.1 (0.6) 105,175.7 5.1 4.7 34.6 Qatar (DSM) 9,469.9 6.1 4.9 (9.3) 18.1 DJIA BIST 100 Nikkei 20,118.9 1.0 0.4 5.3 Kuwait (KSE) 6,788.5 1.6 0.4 Sh. Comp 3,222.4 0.1 0.9 3.8 Bahrain (BAX) 1,317.4 0.5 0.6 7.9 Hang Seng 26,389.2 4.1 2.4 19.9 Oman (MSM) 5,121.4 0.0 0.1 (11.4) Sensex 32,020.8 2.1 3.6 20.3 Jordan (ASEGI) 2,169.1 (0.3) 0.1 (0.1) Source: Bloomberg GLOBAL INDICES Weekly Performance (%) BIST 100 MSCI EM Hang Seng Nasdaq Sensex DAX 30 CAC 40 S&P 500 DJIA Nikkei FTSE 100 Sh. Comp Jordan (ASEGI) YTD Performance (%) 5.1 BIST 100 MSCI EM Sensex Nasdaq Hang Seng DAX 30 S&P 500 DJIA CAC 40 Nikkei Sh. Comp FTSE 100 Jordan (ASEGI) 4.4 4.1 3.2 2.1 2.0 1.8 1.4 1.0 1.0 0.4 0.1 (0.3) (1.0) 0.0 1.0 2.0 3.0 4.0 5.0 34.6 21.4 20.3 20.0 19.9 (0.1) Source: Bloomberg 0.0 10.0 20.0 30.0 40.0 Source: Bloomberg GCC INDICES Weekly Performance (%) YTD Performance (%) Qatar (DSM) Kuwait (KSE) 6.1 S&P GCC UAE (ADX) 1.6 UAE (DFM) KSA (TASI) 1.5 UAE (ADX) 1.4 0.2 (0.6) Qatar (DSM) 0.5 Oman (MSM) 0.0 0.0 4.7 KSA (TASI) Kuwait (KSE) Oman (MSM) 7.9 S&P GCC 2.8 2.2 Bahrain (BAX) 14.5 Bahrain (BAX) 4.0 Dow Jones Islamic 18.1 Dow Jones Islamic 4.3 UAE (DFM) 2.0 4.0 6.0 Source: Bloomberg (9.3) (11.4) (20.0) 8.0 (10.0) 0.0 10.0 Most major global indices traded higher this week. US stocks gained after the testimony of the US Fed’s Chair, Janet Yellen, where she stuck a dovish tone stating that the rate-hike process of the central bank would be gradual there would not be any significant rate increases. Nasdaq led its peer US indices over continued gains in Tech sector. Political uncertainties limited the broad market gains to some extent, as the US President’s son revealed emails raising suspicion over likely Russian intervention in last year’s elections. Financial shares were among the notable gainers. Three of the largest banks reported encouraging results during the end of the week. European markets traded higher, with the FTSE 100 index reporting modest gains, as one of the Bank of England’s policymaker showed a dovish stance on the future course of interest rate. Chinese market traded higher, on the back of encouraging domestic data. GCC GCC markets traded higher during the last week, tracking gains in oil prices. Banking sector remained buoyant across the region. Saudi markets traded 1.5% higher, led by gains in Retailing stocks, after United Electronics reported stronger than expected Q2-17 earnings. Zain Saudi rose, amid reports that the company is close to clinch a deal to sell its 7,500 towers. Dubai benchmark outperformed its peer indices, helped by healthy gains in Damac Properties. Abu Dhabi market climbed 2.8%, helped by gains in Telecommunications and Investment & Financial Services stocks. 10.0 9.8 9.5 7.7 5.3 3.8 3.3 (10.0) 6.0 Global 20.0 Qatar Qatari markets jumped 6.1%, majorly on back of strong gains posted by index heavyweight Qatar National Bank, which rallied 11.1%, after reporting better than expected Q2-17 results. Trading value climbed, amidst lower volume with Banking, Industrial and Telecommunication indices accounting for almost 77% of the total trades. Out of the total 44 listed companies, 43 stocks advanced, while 1 remained unchanged. Source: Bloomberg DSM INDEX 10,700 9,469.9 9,700 8,700 Jan-17 Mar-17 Index Apr-17 50 SMA 100 SMA May-17 200 SMA Jul-17 Indicator Price Last Close 9,469.9 MAVG 50 9,563.6 MAVG 100 10,024.1 MAVG 200 10,187.5 6 Month High 11,057.8 6 Month Low 8,777.7 RSI (14 Days) 58.2 Source: Bloomberg 2
3. WEEKLY WRAP July 16 , 2017 RATES & CREDIT US Treasury (%) Qatar Treasury (%) 3.50 5.00 2.92 3.00 2.27 1.36 2.87 1.55 1.38 1.00 1.11 0.67 2.10 2.27 5 Yrs 7 Yrs 1.27 0.00 0.00 2 Yrs 4.06 2.30 2.00 1.00 0.50 3.00 3.51 3.26 3.02 1.87 2.00 1.50 4.00 2.33 2.14 2.50 4.44 5 Yrs 7 Yrs Current 10 Yrs 2 Yrs 30 Yrs Current Last Year Source: Bloomberg Qatar Govt. Int. Bonds Price (BPS) WTD Δ (BPS) MTD Δ (BPS) YTD Δ (BPS) Global US 30 Yrs Source: Bloomberg CDS 5 Years CDS 10 Yrs Last Year 25.9 (0.4) (0.4) (4.0) Maturity Price (USD) Z Spread (BPS) Yield (%) WTD Δ (USD) YTD Δ (USD) QGS 2018 99.9 98.9 2.35 NA (0.6) QGIB 2019 107.1 74.3 2.18 0.3 (2.9) QGIB 2020 106.2 102.6 2.60 0.8 (1.9) Qatari Diar 2020 98.1 107.3 2.84 1.6 0.0 UK 22.1 1.2 0.1 (10.9) Germany 16.6 (0.2) (0.8) (7.4) QGIB 2021 105.4 138.7 3.01 0.4 (2.1) France 23.2 (0.5) (0.6) (16.0) QGIB 2022 106.2 114.7 2.98 1.1 (1.0) Italy 148.6 (1.7) 0.3 (13.7) QGS 2023 100.2 122.2 3.14 0.6 (2.0) 98.1 129.7 3.47 1.8 1.3 Greece 603.4 (19.0) (40.8) (522.8) QGIB 2026 Russia 166.4 (8.3) (4.2) (67.6) QGIB 2030 158.1 163.5 3.92 1.7 3.2 Japan 27.6 0.0 1.0 (4.4) QGIB 2040 128.4 190.7 4.38 1.8 3.2 QGIB 2042 119.6 192.1 4.41 2.1 2.7 QGIB 2046 102.9 190.7 4.42 2.9 2.6 Turkey 192.1 (12.2) (4.3) (83.2) Brazil 225.8 (14.4) (18.8) (57.5) Source: Bloomberg, QCB Egypt 407.5 (15.8) 0.1 (51.7) US Swap Rates Price (%) Weekly Δ (BPS) YTD Δ (BPS) Abu Dhabi 62.0 (2.3) (1.4) (2.5) 3M LIBOR 1.304 (0.002) 0.306 Bahrain 241.1 (16.5) (19.5) (71.3) 6M LIBOR 1.456 (0.009) 0.138 1.738 (0.020) 0.052 GCC Tenor Dubai 127.9 (9.7) (9.2) (27.0) 12M LIBOR Qatar 106.8 (17.2) (11.0) 14.2 2 years 1.595 (0.052) 0.138 Saudi Arabia 105.7 (5.5) (14.2) 17.4 5 years 1.930 (0.087) (0.047) 10 years 2.282 (0.072) (0.057) 30 years 2.581 (0.031) (0.014) International Credit Spreads iTraxx Europe 54.4 (2.8) (2.0) (18.4) Source: Bloomberg iTraxx Europe Crossover 244.1 (12.5) (3.9) (47.2) Commentary CDX North America IG 58.3 (3.7) (3.0) (9.4) CDX North America HY 325.5 (16.3) (13.2) (28.6) iTraxxSovX CEEMEA NA NA NA NA iTraxx Europe Senior Financial 23.9 (5.3) (3.5) (46.2) US treasuries yields followed a downward trajectory this week, after Donald Trump’s son released email’s showing Russian involvement in US Presidential elections. Tepid US inflation, a second consecutive decline in US retail sales for June, and a dovish stance stuck by Fed Chair Janet Yellen, further pressured yields. Eurozone government bond yields soared as market saw heavy sell-off by the investors on expectations that ECB President Mario Draghi would talk of reducing dependence on monetary stimulus at the Fed's Jackson Hole Economic Policy Symposium. iTraxx Europe Sub Financial 36.6 (9.2) (6.8) (88.1) Source: Bloomberg 3
4. WEEKLY WRAP July 16 , 2017 COMMODITIES Commodities Price Commentary Brent (USD/bbl) 48.9 WTI Crude (USD/bbl) 46.5 Brent posted strong gains this week, driven by optimism over further supply cuts by OPEC members, after the cartel invited Libya and Nigeria at its upcoming meet. Easing supply glut, which was affirmed by the largest weekly decline in US crude stockpiles in 10 months, further supported oil prices. Natural gas prices rose for the week, led by lower than expected rise in natural gas storage. Copper prices posted a gain of 1.8%, on news of strike at Chile’s Zaldivar mine and weakness in USD. The prices were further supported by China’s stronger-than-expected import data for June-17. Gold prices rose for the week, supported by weaker-than-expected US inflation data, and rising doubts over Federal Reserve rate hike in coming months. Natural Gas (USD/mmBTU) 3.0 Gold (USD/t oz.) 1,227.5 Silver (USD/t oz.) 15.9 Copper (USD/lb) 268.4 Source: Bloomberg Weekly Performance (%) YTD Performance (%) WTI Crude Copper 5.2 Brent Natural Gas Natural Gas 1.5 0.0 1.0 (13.4) Brent 1.8 Gold (0.7) WTI Crude 3.3 Copper 6.6 Silver 4.1 Silver 7.1 Gold 4.7 2.0 3.0 4.0 5.0 (13.9) (20.0) (25.0) 6.0 Source: Bloomberg (20.0) (15.0) (10.0) (5.0) 0.0 5.0 10.0 Source: Bloomberg FX Currencies Price Currencies Price GBP/USD 1.3128 USD/INR 63.9475 EUR/USD 1.1500 USD/CNY 6.7753 CAD/USD 0.7908 USD/TRY 3.5381 AUD/USD 0.7832 USD/EGP 17.9608 0.7347 USD/ZAR 13.0357 112.5300 USD/RUB 59.0129 NZD/USD USD/JPY Commentary USD ended lower for the week against its major peers, weighed by weaker-thanexpected US inflation and second consecutive drop in US retail sales during June-17. US Fed chair Janet Yellen’s dovish comments further weighed on the greenback. Political issues surrounding interference by Russia in US elections added also impacted the currency. CAD benefitted from higher oil prices and an interest rate hike by Bank of Canada. GBP got support from stronger employment data for May-2017 and hawkish statements by BoE policy maker Ian McCafferty’s, who said that he would consider unwinding quantitative easing program earlier than planned. Source: Bloomberg Weekly Performance (%) AUD ZAR RUB TRY CAD GBP JPY NZD EUR CNY INR EGP YTD Performance (%) EUR AUD CAD GBP NZD INR ZAR RUB JPY CNY EGP TRY 3.0 2.8 2.4 2.2 1.8 1.6 1.2 0.9 0.6 0.6 0.5 (0.5) (1.0) Source: Bloomberg (0.5) 0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 9.1 8.7 6.3 6.1 6.0 5.7 5.6 4.4 4.0 2.8 0.7 (0.4) (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