GCC Daily Market Update - 17 September

Transcription

1. WEEKLY WRAP September 17 , 2017 ECONOMIC UPDATE & NEWS (0.10%) UK CPI YoY Aug 2.80% 2.90% 2.60% UK Jobless Claims Change Aug - (2.8k) (2.9k) Japan Industrial Production MoM Jul F - (0.80%) (0.80%) France CPI YoY Aug F 0.90% 0.90% 0.90% Italy CPI EU Harmonized YoY Aug F 1.40% 1.40% 1.40% UK Bank of England Bank Rate Sep-14th 0.25% 0.25% 0.25% US Initial Jobless Claims Sep-09th 300k 284k 298k US CPI MoM Aug 0.30% 0.40% 0.10% Russia Gold and Forex Reserve Sep-08th - 427.3b 423.1b US U. of Mich. Sentiment Sep P 95.0 95.3 96.8 Source: Bloomberg GLOBAL NEWS    US CPI rose by 0.4% MoM and 1.9% YoY in Aug-17 as compared to a rise of 0.1% MoM and 1.7% YoY in July-17. The rise in Aug-17 can be attributed to higher energy prices. (Source: Nasdaq) US PPI rose by 0.2% MoM and 2.4% YoY in August-17 mainly driven by a surge in the cost of gasoline. (Source: CNBC) Canada’s unemployment rate fell by 0.1 percentage points over the month to 6.2% in Aug-17. An increase of 110,000 people working part time was offset by 88,000 decline in the number of people working full-time. (Source: Statcan)  UK industrial production grew by 0.2% MoM in Jul-17 driven by rise in manufacturing output. (Source: Market Insider)  UK inflation rose by 2.9% YoY in Aug-17 as compared to 2.6% YoY in Jul-17 driven by rise in price of clothing and footwear by 4.6% during the month. (Source: Bloomberg)  Germany's CPI rose by 1.8% YoY in Aug-17. Excluding food & energy, CPI was at 1.6%, while food price grew by 3.0%. (Source: Market Insider)  Eurozone employment grew by 0.4% QoQ and 1.6% YoY to 155.6mn in Q2-17. Malta, Spain, Greece and Poland reported the highest quarterly increases. (Source: Market Insider)  Eurozone trade surplus declined to EUR 18.6bn in Jul-17 as compared to EUR 21.7bn in Jun-17 driven by decline in exports by 1.1% MoM and rise in imports by 0.7% MoM. (Source: Morning Star)  Turkey GDP grew by 5.1% YoY and 2.1% QoQ in Q2-17. Household spending grew by 8.2% YoY while government expenditure declined by 4.3% YoY in Q2-17. (Source: Market Insider) 2.30 2.25 2.20 2.15 2.10 2.05 2.00 1.95 1.90 Source: Bloomberg    The number of IPOs in GCC grew from 3 in H1-16 to 13 in H1-17, with a combined value of USD 571.0mn, according to BMI research. (Source:     GCC’s active construction projects’ total value reached USD 2.4tn, with urban construction contributing USD 1.8tn to the value, according to BNC Construction Intelligence. (Source: Trade Arabia) Moody’s Investors Service said that the diplomatic disagreement that took place between Qatar and a number of GCC and Arab countries is credit negative for all GCC countries. (Source: Mubasher) Dubai’s private sector rose sharply in Aug-17, with growth driven by wholesale and retail sector, followed by construction and travel & tourism. (Source: Gulf News) Dubai government raised USD 1.1bn loan to extend the city's metro rail system. (Source: Zawya) The number of constructed buildings in Abu Dhabi grew by 21.6% YoY to 913 in Q2-17. The residential buildings constituted 85.5% of the total completed buildings. (Source: Trade Arabia) Bahrain Government is expected to issue USD 1.5bn to USD 2.5bn worth triple-tranche Sukuk bonds with maturity of 7 year, 12 years and 30 years. (Source: Reuters) QATAR NEWS  According to IMF forecasts, lower imports and oil price recovery will allow Qatar’s current account to swing from a deficit of 7.7% of GDP to a surplus of 3.9% in 2017. (Source: Gulf Times)  Qatar’s PPI rose by 11.1% YoY but declined by 1.5% MoM in Jul-17. The rise over the year can be attributed to mining sector, which grew by 14.5%. (Source: Gulf Times)  Qatar’s Cabinet approved a draft MoU on facilitating transport and transit traffic between Qatar, Iran and Turkey. (Source: Gulf Times)  Qatar reported 1,766 new company registration during Aug-17, according to a latest report. (Source: Gulf Times)  Qatar is estimated to have injected about USD 40.0bn out of the total USD 340.0bn of its financial reserves in the first two months of diplomatic stir in order to support its economy, according to Moody’s. (Source: Gulf Times)  Qatar tourism sector grew by 1.0% YoY to 1.5mn visitors in H1-17 driven mainly by visitors from Europe (+10.0% YoY) and the Americas (+7.0% YoY). (Source: Gulf Times)  Qatar’s USD 300bn sovereign wealth fund was less impacted by the Gulf political crisis and the fund would continue its policy of targeting hi-tech and infrastructure companies in the US. (Source: Gulf Times)  Qatar Stock Exchange listed companies have made a total net profit of QAR 20.1bn in H1-17 with the banking sector contributing 54.0% of it. Arabian Business)  Saudi Arabia’s Energy Minister agreed with his UAE counterpart to extend a pact on global oil supply cuts beyond March 2018 depending on market fundamentals. (Source: Reuters) Oman's Ministry of Oil & Gas is tendering 4 onshore hydrocarbon blocks as part of the Licensing Round 2017. The bidding will formally commence on 20th Sep-17 and the deadline for submission of bids is 31st Dec-17. (Source: Trade Arabia) Oman’s CPI increased 1.0% YoY in Aug-17 driven by rise in prices of furnishings & household equipment, Housing, water, electricity, etc. (Source: Oman Observer)  GCC NEWS  2.10 11-Sep 0.60% 04-Sep 0.50% 28-Aug Aug 21-Aug CPI MoM 14-Aug UK UST 10yr Bond 07-Aug (1.90%) 31-Jul Prior 8.00% 24-Jul Actual 4.10% 17-Jul Survey Jul 10-Jul Period 03-Jul Core Machine Orders MoM 26-Jun Event Japan 19-Jun Region (Source: Gulf Times)  Qatar Central Bank is planning to expand the activities of The Qatar Credit Bureau by adding more members and services like credit score models for commercial and SME customers. (Source: The Peninsula)  RasGas Company will sign a 15-year agreement with Bangladesh on 25th Sep-17 to export 1.8mn tons of LNG a year for the first five years and 2.5mn tons a year for the next 10 years. (Source: Reuters) 1
2. WEEKLY WRAP September 17 , 2017 EQUITY Index Price S&P 500 DJIA WTD %Δ MTD %Δ YTD %Δ COMMENTARY Index Price WTD %Δ MTD %Δ YTD %Δ 2,500.2 1.6 1.2 11.7 MSCI EM 1,102.2 1.0 1.3 27.8 22,268.3 2.2 1.5 12.7 S&P GCC 1,674.9 0.4 0.2 6.6 Nasdaq 5,988.0 1.3 (0.0) 23.1 Dow Jones Islamic 3,439.7 1.1 1.9 18.3 FTSE 100 7,215.5 (2.2) (2.9) 1.0 KSA (TASI) 7,373.2 0.2 1.6 2.3 DAX 30 12,518.8 1.7 3.8 9.0 UAE (DFM) 3,657.2 0.4 0.5 3.6 CAC 40 5,213.9 2.0 2.5 7.2 UAE (ADX) 4,481.2 0.6 0.3 (1.4) 107,741.7 (0.7) (2.1) 37.9 Qatar (DSM) 8,409.5 (3.1) (4.4) (19.4) 20.3 BIST 100 Nikkei 19,909.5 3.3 1.3 4.2 Kuwait (KSE) 6,913.9 0.2 0.3 Sh. Comp 3,353.6 (0.3) (0.2) 8.1 Bahrain (BAX) 1,303.8 (0.9) 0.1 6.8 Hang Seng 27,807.6 0.5 (0.6) 26.4 Oman (MSM) 5,002.5 (0.9) (1.0) (13.5) Sensex 32,272.6 1.8 1.7 21.2 Jordan (ASEGI) 2,136.4 (0.5) (1.0) (1.6) Source: Bloomberg GLOBAL INDICES Weekly Performance (%) YTD Performance (%) 3.3 Nikkei DJIA CAC 40 Sensex DAX 30 S&P 500 Nasdaq MSCI EM Hang Seng Sh. Comp Jordan (ASEGI) BIST 100 FTSE 100 BIST 100 MSCI EM Hang Seng Nasdaq Sensex DJIA S&P 500 DAX 30 Sh. Comp CAC 40 Nikkei FTSE 100 Jordan (ASEGI) 2.2 2.0 1.8 1.7 1.6 1.3 1.0 0.5 (0.3) (0.5) (0.7) (2.2) (4.0) (2.0) 0.0 2.0 12.7 11.7 9.0 8.1 7.2 4.2 1.0 (1.6) Source: Bloomberg 0.0 10.0 20.0 30.0 40.0 Source: Bloomberg GCC INDICES Weekly Performance (%) Kuwait (KSE) 1.1 UAE (ADX) 20.3 Dow Jones Islamic 0.6 18.3 S&P GCC 0.4 Bahrain (BAX) 6.8 UAE (DFM) 0.4 S&P GCC 6.6 Kuwait (KSE) 0.2 UAE (DFM) KSA (TASI) 0.2 KSA (TASI) Oman (MSM) (0.9) UAE (ADX) Bahrain (BAX) (0.9) Oman (MSM) Qatar (DSM) Qatar QE index underperformed its peer indices, amid pessimism that the ongoing crisis with other GCC member nations might not be resolved for a foreseeable future. The benchmark settled below the psychological 8,500 mark, touching multi month low level, on account increased bearish pressure from foreign institutional investors. Trading value and volume increased with, Banking, Industrials and Telecommunication sectors accounting for 73.5% of the total trading value. Out 45 listed stocks, 43 exchanged hands, 29 declined, 11 advanced and 5 remained unchanged. YTD Performance (%) Dow Jones Islamic 3.6 2.3 (1.4) (13.5) Qatar (DSM) (19.4) (3.1) (4.0) (3.0) (2.0) (1.0) 0.0 1.0 (30.0) (20.0) (10.0) 0.0 2.0 Source: Bloomberg 10.0 20.0 Most global markets settled higher during the last week, as investors shrugged off the fears from the launch of another ballistic missile from North Korea. Insurance stocks were among the largest gainers in this week’s market action, due to lower than expected impact of hurricane Irma, on the US economy. US markets ended the week in green, amid optimism that the Trump administration might soon introduce tax reforms. Financial shares inched higher, on account of higher treasury yields. The Stoxx Europe 600 index ended at its highest levels in past one month, led by gains in Automobile and Technology stocks. The UK’s benchmark bucked the overall trend to end lower due to the strength in the GBP, following release of upbeat inflation. In Japan, the Nikkei index ended higher, helped by weakness in JPY. GCC Most GCC markets traded higher during the last week, amid strength in crude oil prices. Saudi Arabian benchmark rose 0.2%. Petrochemical companies inched higher, with improved pricing prospects for their products in view of some strength in crude prices. However, Telecommunication shares lost ground after the nation’s regulator permitted internet calling in the nation. In Dubai, Real Estate companies rose, amid reports that the UAE is allowing direct sales for this year’s annual Cityscape exhibition in Dubai. In Abu Dhabi, Dana Gas climbed 1.2%, amid reports of the company’s sukuk holders have proposed for a restructuring process. 37.9 27.8 26.4 23.1 21.2 (10.0) 4.0 Global 30.0 Source: Bloomberg DSM INDEX 11,300 8,409.5 10,300 9,300 8,300 Oct-16 Dec-16 Jan-17 Index Mar-17 50 SMA Apr-17 100 SMA Jun-17 200 SMA Jul-17 Sep-17 Indicator Price Last Close 8,409.5 MAVG 50 9,125.8 MAVG 100 9,451.2 MAVG 200 9,969.1 6 Month High 10,509.9 6 Month Low 8,409.5 RSI (14 Days) 16.1 Source: Bloomberg 2
3. WEEKLY WRAP September 17 , 2017 RATES & CREDIT US Treasury (%) Qatar Treasury (%) 2.77 3.00 2.50 1.50 2.03 4.28 4.00 2.45 4.01 1.98 1.69 1.50 3.29 3.06 2.82 3.00 1.38 1.00 0.50 2.20 1.81 2.00 5.00 3.03 2.00 1.20 1.00 0.76 2.13 2.29 5 Yrs 7 Yrs 1.36 0.00 0.00 2 Yrs 5 Yrs 7 Yrs Current 10 Yrs 2 Yrs 30 Yrs Current Last Year Source: Bloomberg 10 Yrs Source: Bloomberg CDS Qatar Govt. Int. Bonds Maturity Price (USD) Z Spread (BPS) Yield (%) Global QGS 2018 100.1 46.9 US 29.4 0.0 0.0 (0.5) QGIB 2019 107.0 40.1 UK 23.2 1.1 1.1 (9.9) QGIB 2020 106.7 Qatari Diar 2020 99.1 5 Years CDS 30 Yrs Last Year Price (BPS) WTD Δ (BPS) MTD Δ (BPS) YTD Δ (BPS) WTD Δ (USD) YTD Δ (USD) 1.41 0.0 (0.2) 1.87 (0.0) (3.1) 63.5 2.24 (0.1) (1.4) 85.1 2.59 (0.4) 0.9 100.6 2.65 (0.1) NA Germany 14.1 (1.1) (1.1) (10.0) QGIB 2021 106.2 France 22.0 (0.8) (0.8) (17.3) QGIB 2022 106.8 98.7 2.78 (0.3) (0.4) Italy 139.2 (6.0) (6.0) (23.1) QGS 2023 101.3 107.6 2.94 (0.1) (1.0) Greece 524.2 (40.2) (40.2) (602.1) QGIB 2026 99.7 118.6 3.26 (0.5) 2.9 QGIB 2030 159.7 159.1 3.76 (1.0) 4.8 QGIB 2040 130.9 188.3 4.22 0.2 5.7 QGIB 2042 122.1 190.0 4.25 (0.5) 5.3 QGIB 2046 105.7 187.7 4.26 (0.1) 5.4 Russia 133.2 (7.5) (7.5) (100.8) Japan 35.2 0.7 0.7 3.2 Turkey 163.2 (1.1) (1.1) (112.2) Brazil 180.9 (2.3) (2.3) (102.4) Egypt 357.5 0.0 0.0 (101.7) Abu Dhabi 58.5 (0.8) (0.8) (6.0) Bahrain 237.9 0.5 0.5 (74.6) Dubai 148.4 1.5 1.5 Qatar 91.5 0.0 Saudi Arabia 83.7 (2.7) Source: Bloomberg, QCB US Swap Rates GCC Tenor Price (%) Weekly Δ (BPS) YTD Δ (BPS) 3M LIBOR 1.321 0.011 0.323 6M LIBOR 1.459 0.011 0.141 1.5 12M LIBOR 1.720 0.024 0.034 0.0 (1.2) 2 years 1.638 0.136 0.181 (2.7) (4.6) 5 years 1.889 0.173 (0.088) 10 years 2.173 0.161 (0.165) 30 years 2.443 0.117 (0.152) International Credit Spreads iTraxx Europe 50.6 (3.2) (5.2) (22.2) iTraxx Europe Crossover 225.4 (9.9) (13.7) (66.0) CDX North America IG 56.2 (4.0) (2.6) (11.5) CDX North America HY 325.3 (10.5) 0.0 (28.8) iTraxxSovX CEEMEA NA NA NA NA iTraxx Europe Senior Financial 23.7 (6.3) (6.9) (46.3) iTraxx Europe Sub Financial 24.3 (13.0) (16.8) (100.3) Source: Bloomberg Commentary US Treasury yields increased earlier in the week following the reports of North Korea refraining from conducting another missile test and as investors assessed the impact of Hurricane Irma to be not as severe as expected. The yields were also supported by stronger-than-expected data for US CPI and PPI for Aug-2017, which increased the odds of another Fed rate hike in Dec-2017. UK government yields soared as BoE indicated increasing interest rate in the coming months. The yields were also supported by faster-than-expected rise in UK inflation for Aug-2017. Source: Bloomberg 3
4. WEEKLY WRAP September 17 , 2017 COMMODITIES Commodities Price Commentary Brent (USD/bbl) 55.6 WTI Crude (USD/bbl) 49.9 Oil prices soared this week, buoyed by IEA report showing global crude production fell, for the first time in last four months, during Aug-17. The prices were also supported by IEA forecast indicating a further tightening of the market as fuel demand increased. Natural gas prices rose, backed by forecasts of warmer than normal temperature over eastern portion of the US for the next few weeks. The gains were however capped after EIA reported a slightly higher than forecasted rise in natural gas storage by 91 bcf. Weaker-than-expected Chinese industrial production weighed the copper prices. Gold prices ended lower as risk-on mode kept investors away from the precious metal. Natural Gas (USD/mmBTU) 3.0 Gold (USD/t oz.) 1,321.3 Silver (USD/t oz.) 17.6 Copper (USD/lb) 292.8 Source: Bloomberg Weekly Performance (%) YTD Performance (%) WTI Crude Copper 5.1 Natural Gas Brent 10.1 Brent (1.9) Silver 14.7 Silver 3.4 Gold 16.9 Gold 4.6 (2.1) WTI Crude (2.3) (7.1) Natural Gas Copper (3.1) (4.0) (2.0) 0.0 2.0 4.0 (18.8) (30.0) 6.0 Source: Bloomberg (20.0) (10.0) 0.0 10.0 20.0 Source: Bloomberg FX Currencies Price Currencies Price GBP/USD 1.3624 USD/INR 63.5825 EUR/USD 1.1975 USD/CNY 6.5526 CAD/USD 0.8202 USD/TRY 3.4377 AUD/USD 0.8002 USD/EGP 17.6439 NZD/USD 0.7299 USD/ZAR 13.1569 110.8300 USD/RUB 57.5334 USD/JPY Commentary USD ended higher against its major peers, led by rebound in US producer prices and upbeat US inflation data for Aug-17. Unexpected decline in US retail sales for Aug-17 however pressured the currency later in the week. GBP strengthened to its highest level since Brexit as investors increased their bets on BoE rising interest rates, on back of encouraging inflation data for Aug-17. JPY weakened despite North Korea’s another missile launch, as investors’ willingness to buy Japanese assets faded with Japan being in North Korea’s firing line. CAD soared following the rise in oil prices however ended lower as the boost from last week’s interest rate hike faded. Source: Bloomberg Weekly Performance (%) GBP NZD EGP CAD INR RUB CNY AUD EUR TRY ZAR JPY (2.7) (3.0) Source: Bloomberg YTD Performance (%) EUR AUD CAD GBP RUB CNY INR JPY NZD ZAR EGP TRY 3.0 0.5 (0.3) (0.3) (0.4) (0.7) (0.7) (0.8) (0.8) (1.8) (2.0) (1.0) 0.0 1.0 2.0 3.0 4.0 13.6 11.0 10.2 10.2 7.0 6.2 5.9 5.6 5.3 4.3 2.7 2.5 0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0 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