GCC Daily Market Update - 19 February

Transcription

1. WEEKLY WRAP February 19 , 2017 ECONOMIC UPDATE & NEWS Japan Industrial Production MoM Dec F - 0.70% 0.50% UK CPI MoM Jan (0.50%) (0.50%) 0.50% UK CPI YoY Jan 1.90% 1.80% 1.60% Germany ZEW Survey Current Situatn Feb 77 76.4 77.3 Germany ZEW Survey Expectations Feb 15 10.4 16.6 4Q P 0.50% 0.40% 0.40% (20.5k) Eurozone GDP SA QoQ UK Jobless Claims Change Jan 0.5k (42.4k) US CPI MoM Jan 0.30% 0.60% 0.30% Russia Gold and Forex Reserve Feb-10th - 393.6b 394.1b US Initial Jobless Claims Feb-11th 245k 239k 234k Source: Bloomberg GLOBAL NEWS        2.60 2.55 2.50 2.45 2.40 2.35 2.30 2.25 2.20 Source: Bloomberg  Fed Chair said more interest-rate hikes will be appropriate if the US economy meets Fed’s outlook of gradually rising inflation and tightening labor market. (Source: Bloomberg) US President Donald Trump called tax code revisions a critical way to boost the nation's economy in a meeting with CEO of major retailers.  (Source: Reuters)  US producer prices rose 0.6% MoM in Jan-17 amid increases in the cost of energy products. (Source: Nasdaq) US CPI rose by 0.6% MoM in Jan-17 as households paid more for gasoline, new motor vehicles, airline fares and clothing. (Source: Reuters) US retail sales rose 0.4% MoM in Jan-17, buoyed by purchases of electronics and appliances. (Source: Reuters) US weekly jobless claims rose by 5,000 to a seasonally adjusted 239,000 for the week ended 11th Feb-17. (Source: Reuters) Housing starts fell 2.6% MoM to an annual rate of 1.25mn units in Jan-17 as construction of multi-family housing projects fell. (Source:             Eurozone GDP grew by 0.4% QoQ in Q4-16 as positive domestic demand was offset by reduced exports contribution. (Source: Reuters) German GDP grew by 0.4% QoQ in Q4-16, led by increased state spending and domestic demand. (Source: Reuters) ECB minutes of 19th Jan-17 meeting showed little appetite to curb stimulus amidst a slew of elections due this year. (Source: Reuters) Japanese economy grew by an annualized 1.0% QoQ in Q4-16 as recovering global demand fueled export gains. (Source: Bloomberg) Russia will decide in April-May if it would extend oil production curb agreement, Russian Energy Minister said. (Source: Trade Arabia) China's PPI accelerated 6.9% YoY in January-17 as prices of steel, coal and other raw materials rallied. (Source: Reuters) Chinese banks’ net loan rose by CNY 2.03tn in Jan-17, while credit growth including non-bank lending rose CNY 3.7tn. (Source: Reuters) China completed CNY 7.92tn worth of investment in major projects by end of 2016 with about 30% of the total going into information, power grid and oil and gas sectors. (Source: Reuters) Turkey unemployment rate rose by 0.3 percentage points MoM and 1.6 percentage points YoY to 12.1% in Nov-16, the highest since Mar10. (Source: Reuters) Direct capital investment in Turkey rose to nearly USD 2bn in Dec-16, driven by non-resident investments. (Source: Daily Sabah)     Policy makers in GCC are aiming to introduce a 5% VAT at the start of 2018, said Under-secretary at the UAE Finance Ministry. (Source: Arabian       The UAE’s credit growth eased to 6% in 2016 from 7.8% in 2015 and is expected to remain in single digit in 2017, according to IIF. (Source: Zawya) Rising transport and education costs led Qatar's annual inflation higher by 1.2% YoY in Jan-17. (Source: Qatar Tribune) Several car rental companies in Qatar are planning to downsize their fleet by 20% or spin-off their businesses due to increased competition and slowdown in the market. (Source: Qatar Tribune) Qatar imported USD 440mn worth of ships, electrical and electronic devices, machines and furniture to Qatar in 2016. (Source: AA) Qatar is ranked in the top 15% of countries for productivity potential according to a new KPMG report. (Source: Zawya) The number of building permits issued in Jan-17 rose by 11% MoM, according to report by MDPS. (Source: Zawya) Qatar will provide Turkey with LNG in case of higher demand, as it has two active agreements with no restrictions on quantities. (Source: DS)  Business)  The Saudi government is interested in taking over South Korea’s Daewoo Engineering & Construction Co. (Source: Pulse news) Oman’s Conventional banks' total credit rose 7.6% YoY in 2016. The slower pace of growth was due to decline in deposits from government entities. (Source: Muscat Daily) Kuwait is sticking with plans to add half a million bpd of oilproduction capacity to help drain a global oversupply, CEO of Kuwait Oil Co. said. (Source: Bloomberg) Oman’s budget deficit for 2016 stood at OMR 5,010.5mn as falling crude oil export revenues affected fiscal balance. (Source: Times of Oman) Oman plans to drill a number of exploration wells in Blocks 3 & 4 as per Swedish based Tethys Oil. (Source: Trade Arabia) QATAR NEWS GCC NEWS  UAE will see the most positive effect amongst all GCC states from the introduction of VAT in 2018, as per BMI report. (Source: Arabian Business) Average apartment rents in Abu Dhabi fell by 7% YoY in 2016 amid continuing low economic growth, job losses and cost cutting measures, according report by Chestertons Mena. (Source: Trade Arabia) Kuwait private sector loans grew by 2.5% YoY in Dec-16 compared to 4.1% YoY growth registered in Nov-16. (Source: Reuters) Total investment in Oman's industrial estates crossed OMR 6bn with H1-16 witnessing higher growth rates in various fields. (Source: Zawya) The merger of NBAD and FGB will be official from 1st April-17, with shares in the new company trading from the next day. (Source: AB) Sovereign wealth funds from Abu Dhabi and Kuwait have taken part in the bidding process for a majority stake in Endeavour Energy. (Source: AB)  Reuters)  2.36 13-Feb 1.40% 06-Feb 1.00% 30-Jan 1.10% 23-Jan 4Q P 16-Jan GDP Annualized SA QoQ 09-Jan Japan UST 10yr Bond 02-Jan 0.30% 26-Dec Prior 0.20% 19-Dec Actual 0.30% 12-Dec Survey 4Q P 05-Dec Period GDP SA QoQ 28-Nov Event Japan 21-Nov Region  Qatar crude oil prices rose between 2.3% and 3.6% in Jan-17. The onshore crude oil prices rose 3.2% MoM and offshore crude oil price were up by 3.6% MoM. (Source: QNA) Qatar’s hospitality market will grow over 10% in next 5-years due to tourism-related developments, a report by Alpen Capital showed. (Source: Qatar Tribune) 1
2. WEEKLY WRAP February 19 , 2017 EQUITY Index Price Index Price WTD %Δ 2,351.2 1.5 3.2 5.0 MSCI EM 939.0 1.0 3.3 8.9 20,624.1 1.7 3.8 4.4 S&P GCC 1,672.0 1.7 1.9 6.4 Nasdaq 5,324.7 1.9 4.1 9.5 Dow Jones Islamic 3,075.6 1.3 3.0 5.8 FTSE 100 7,300.0 0.6 2.8 2.2 KSA (TASI) 7,131.3 2.3 0.4 (1.1) DAX 30 11,757.0 0.8 1.9 2.4 UAE (DFM) 3,650.8 (0.9) 0.2 3.4 CAC 40 4,867.6 0.8 2.5 0.1 UAE (ADX) 4,643.2 1.6 2.1 2.1 BIST 100 88,830.4 1.6 2.9 13.7 Qatar (DSM) 10,819.3 1.8 2.1 3.7 Nikkei S&P 500 DJIA WTD %Δ MTD %Δ YTD %Δ COMMENTARY MTD %Δ YTD %Δ 19,234.6 (0.7) 1.0 0.6 Kuwait (KSE) 6,824.5 3.7 (0.1) 18.7 Sh. Comp 3,202.1 0.2 1.4 3.2 Bahrain (BAX) 1,323.7 1.3 1.5 8.5 Hang Seng 24,033.7 1.9 2.9 9.2 Oman (MSM) 5,843.1 0.4 1.2 1.0 Sensex 28,468.8 0.5 2.9 6.9 Jordan (ASEGI) 2,213.1 1.6 2.4 2.0 Source: Bloomberg GLOBAL INDICES Weekly Performance (%) YTD Performance (%) 1.9 1.9 1.7 1.6 1.6 1.5 Hang Seng Nasdaq DJIA Jordan (ASEGI) BIST 100 S&P 500 MSCI EM CAC 40 DAX 30 FTSE 100 Sensex Sh. Comp Nikkei (0.7) 1.0 0.8 0.8 0.6 0.5 0.2 (1.0) (0.5) 0.0 0.5 1.0 1.5 2.0 13.7 BIST 100 Nasdaq Hang Seng MSCI EM Sensex S&P 500 DJIA Sh. Comp DAX 30 FTSE 100 Jordan (ASEGI) Nikkei CAC 40 9.5 9.2 8.9 6.9 3.2 2.4 2.2 2.0 0.6 0.1 Source: Bloomberg 5.0 10.0 15.0 Source: Bloomberg GCC INDICES Weekly Performance (%) YTD Performance (%) Kuwait (KSE) 3.7 KSA (TASI) Kuwait (KSE) 18.7 Bahrain (BAX) 2.3 8.5 Qatar (DSM) 1.8 S&P GCC S&P GCC 1.7 Dow Jones Islamic 1.6 Qatar (DSM) 3.7 UAE (DFM) 3.4 UAE (ADX) Dow Jones Islamic 1.3 Bahrain (BAX) UAE (DFM) 6.4 5.8 UAE (ADX) 1.3 Oman (MSM) 2.1 Oman (MSM) 0.4 1.0 KSA (TASI) (1.1) (0.9) (2.0) (1.0) 0.0 1.0 2.0 3.0 (5.0) 4.0 Source: Bloomberg 0.0 5.0 10.0 15.0 Global stocks continued the rally this week, with US stocks gaining amidst optimism surrounding Trump’s phenomenal tax reforms. A hawkish testimony by Fed Chair Janet Yellen, sent the financial stocks rallying mid-week, further aiding the broader index. A slew of positive economic releases, showcasing strong retail sales and upbeat inflation added to the optimism. Strong performance from biotechnology and pharmaceutical stocks drove gains for the healthcare sector. European stocks also closed higher this week fueled by strong earnings releases, a pick-up in merger and acquisition activity, and strong performance delivered by cyclical stocks such as mining and banks, aided by strong economic data. Japan’s Nikkei bucked the broader positive trend, closing 0.7% lower as yen closed modestly higher. Lower than expected GDP growth also weighed on the investor sentiment. GCC Most Gulf indices, tracked global equities and surged higher. Kuwait led its GCC peers, taking its rally to 18.7% on YTD basis. Saudi Arabia’s benchmark posted 2.3% gains this week, after two straight weekly declines. Buying activity was more prominent in Public Utilities, Commercial Services and Insurance sectors. In UAE, ADX registered its 2nd week of gains, supported by gains in Banking stocks, with NBAD and FGB leading advancers. Energy shares weighed on the broader index, with Dana Gas closing 9.4% lower. Dubai’s DFM closed in red, weighed by Arabtec, whose annual results disappointed investors. 5.0 4.4 0.0 2.5 Global 20.0 Qatar QE index added 1.8% this week, supported by bullish bets from foreign institutions and retail investors. Stocks in Telecom, Industrials, Transport and Realty, particularly led advancers, amidst broad based gains. Overall trade turnover rose during the week which saw Real Estate, Telecom, Banking, Insurance and Consumer goods sectors together account for more than 88% of the volumes. Out of the 44 stocks traded, 27 advanced, 16 fell and one remained unchanged. Source: Bloomberg DSM INDEX Indicator Price Last Close 10,819.3 MAVG 50 10,588.0 10,500 MAVG 100 10,354.0 10,000 MAVG 200 10,326.7 6 Month High 11,314.6 6 Month Low 9,636.4 RSI (14 Days) 72.5 11,500 10,819.3 11,000 9,500 Aug-16 Oct-16 Index Nov-16 50 SMA 100 SMA Jan-17 200 SMA Feb-17 Source: Bloomberg 2
3. WEEKLY WRAP February 19 , 2017 RATES & CREDIT US Treasury (%) Qatar Treasury (%) 3.50 3.00 1.90 2.61 2.00 1.19 0.50 3.47 2.00 1.23 1.00 4.34 3.05 2.69 3.00 1.75 1.51 1.00 4.47 4.00 2.42 2.22 2.50 1.50 5.00 3.02 3.42 1.78 2.78 2.47 1.47 0.74 0.00 0.00 2 Yrs 5 Yrs 7 Yrs 10 Yrs Current 5 Yrs 7 Yrs Current Last Year Source: Bloomberg 10 Yrs 30 Yrs Last Year Source: Bloomberg CDS 5 Years CDS 2 Yrs 30 Yrs 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 100.5 28.3 1.37 0.0 0.2 QGIB 2019 109.9 21.4 1.66 (0.0) (0.1) QGIB 2020 108.8 41.2 2.01 (0.1) 0.7 Qatari Diar 2020 99.5 57.1 2.44 (0.1) 1.4 QGIB 2021 108.3 65.3 2.35 0.2 0.8 US 27.2 (0.5) 0.5 0.5 UK 30.1 0.3 2.1 (1.0) Germany 23.1 1.0 4.2 1.3 France 56.0 2.9 16.2 18.9 QGIB 2022 108.3 69.9 2.63 0.0 1.1 Italy 187.5 6.4 19.1 30.3 QGS 2023 102.2 73.2 2.77 0.0 (0.0) 1,063.1 23.4 26.1 15.6 QGIB 2026 98.7 109.5 3.39 (0.1) 1.9 QGIB 2030 158.0 164.5 4.03 (0.3) 3.1 QGIB 2040 129.5 177.7 4.32 (0.7) 4.3 QGIB 2042 120.8 178.5 4.34 (0.7) 3.9 QGIB 2046 102.5 186.7 4.43 (1.0) 2.1 Greece Russia 182.2 8.2 (2.2) (49.2) Japan 25.0 (1.0) (1.5) (5.0) Turkey 240.9 (6.6) (26.6) (32.3) Brazil 231.2 3.2 (19.7) (49.5) Source: Bloomberg, QCB Egypt 392.8 7.6 (12.9) (59.6) US Swap Rates Abu Dhabi 50.4 (4.3) (7.6) (11.1) Bahrain 233.8 (11.5) (15.1) (68.7) Dubai 126.2 (5.2) (13.8) Qatar 74.4 (0.8) (7.1) GCC Saudi Arabia Tenor 103.9 (2.0) (8.9) Price (%) Weekly Δ (BPS) YTD Δ (BPS) 3M LIBOR 1.057 0.020 0.059 6M LIBOR 1.364 0.026 0.046 (23.6) 12M LIBOR 1.745 0.043 0.059 (5.8) 2 years 1.549 0.042 0.092 5 years 2.012 0.036 0.035 10 years 2.375 0.039 0.036 30 years 2.646 0.051 0.051 (9.5) International Credit Spreads iTraxx Europe 73.8 (1.3) 0.3 1.0 Source: Bloomberg iTraxx Europe Crossover 297.3 (3.8) (4.0) 6.0 Commentary CDX North America IG 63.6 (1.3) (2.7) (4.2) CDX North America HY 321.3 (1.5) (27.9) (32.8) iTraxxSovX CEEMEA NA NA NA NA iTraxx Europe Senior Financial 66.8 (1.2) 3.5 (3.2) iTraxx Europe Sub Financial 112.3 (5.0) (2.3) (12.3) US benchmark treasury yields started on a strong note, amidst a hawkish stance taken by Fed Chair in her Congressional testimony on Tuesday and Wednesday. Hawkish comments from other Fed officials, supported by strong data on retail sales and consumer inflation, further cemented the rate hike outlook, benefitting the yields. British 10-year government bond yields fell due to release of weak economic data which included a poor consumer price and wage report. Sluggish retail sales, demonstrating weakening consumer sentiment ahead of Brexit talks, further weighed on yields. Source: Bloomberg 3
4. WEEKLY WRAP February 19 , 2017 COMMODITIES Commodities Price Commentary Brent (USD/bbl) 55.8 WTI Crude (USD/bbl) 53.4 Oil prices fell during the week as excess supply concerns resurfaced, after EIA showed US stockpiles rising 3 times more than forecast. Addition of new oil rigs, according to Baker Hughes, further reaffirmed excess supply concerns. A stronger USD further weighed on oil prices. On the positive front, larger than expected cut by Saudi Arabia in compliance with OPEC deal lent some support to the commodity. Copper prices fell on the back of profit taking from last week’s rally. Natural gas prices retreated after EIA reported the lowest drawdown in reserves in the last three months. While uncertainty over the direction of Trump’s policies and elections in Europe supported gold, a hawkish stance by Fed Chair capped the upside. Natural Gas (USD/mmBTU) 2.8 Gold (USD/t oz.) 1,237.6 Silver (USD/t oz.) 18.0 Copper (USD/lb) 270.7 Source: Bloomberg Weekly Performance (%) Silver Gold WTI Crude Brent Copper Natural Gas YTD Performance (%) Silver Copper Gold WTI Crude Brent Natural Gas 0.5 0.3 (0.9) (1.6) (2.2) (6.6) (8.0) (6.0) (4.0) (2.0) 0.0 12.4 8.0 7.5 (0.6) (1.8) (23.9) (30.0) 2.0 Source: Bloomberg (20.0) (10.0) 0.0 10.0 20.0 Source: Bloomberg FX Currencies Price Currencies Price GBP/USD 1.2442 USD/INR 66.5200 EUR/USD 1.0646 USD/CNY 6.8665 CAD/USD 0.7636 USD/TRY 3.6309 AUD/USD 0.7664 USD/EGP 16.1493 NZD/USD 0.7182 USD/ZAR 13.0382 112.8400 USD/RUB 58.2915 USD/JPY Commentary USD gained against most of the major currencies, supported by a hawkish testimony from Fed Chair and a slew of positive data releases. CAD closed in the red, tracking weak oil prices. Disappointing UK macroeconomic numbers weighed on GBP. EUR fell after ECB minutes showed ‘insufficient progress’ toward sustained inflation, suggesting continuation of its ultra-dovish monetary policy. Talks of co-operation between hard left candidates for the French presidency, further weighed on the common currency. EGP staged a strong rally as investors moved back into the country, which has been implementing meaningful structural reforms since Nov-16. Source: Bloomberg Weekly Performance (%) EGP ZAR TRY JPY CNY RUB (0.1) CAD (0.1) NZD (0.1) AUD (0.1) EUR (0.3) INR (0.3) GBP (0.6) (2.0) Source: Bloomberg YTD Performance (%) EGP AUD ZAR RUB JPY NZD CAD INR CNY EUR GBP TRY (2.9) 11.8 2.5 2.0 0.3 0.1 0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 (4.0) 13.2 6.3 5.4 5.4 3.7 3.6 2.6 1.3 1.2 0.9 0.6 (2.0) 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 inf ormation provided in this materials or for any delays, inaccuracies, errors in, or omissions of the said information. 4