MENA Daily Fixed Income Report - 16 April

Transcription

1. MENA Daily Fixed Income Report – 16 April 2020 Kuwait Financial Centre “Markaz” News Saudi Arabia Raised $7 Billion in Bond Sale to Plug Spending Gap Saudi Arabia raised $7 billion via a dollar-denominated bond sale on Wednesday, joining other oil-exporting Persian Gulf states that tapped the debt markets last week to plug funding shortfalls caused by low crude prices and the coronavirus pandemic. The offering marked the second time this year the world’s largest oil exporter has turned to international capital markets. The deal was heavily oversubscribed, with investors placing around $54 billion of orders, according to a person familiar with the matter. The kingdom sold $2.5 billion of bonds maturing in 5.5 years, $1.5 billion of debt due in 10.5 years and $3 billion of 40-year notes. The longest tranche was priced with a yield of 4.55%, down from the initial talk of 5.15%. The shortest securities yield 2.94% and the middle ones 3.34%. IMF predicts MENA oil exporters will lose $230 bil in revenue as fiscal breakevens soar - Middle East and North Africa oil exporters are likely to lose more than $230 billion in crude revenue this year if oil prices persist at current levels, while their breakeven oil prices are set to soar amid higher spending needs, the International Monetary Fund said in a report on Wednesday. "Measured in real terms (adjusted for inflation), oil prices have not been this low since 2001," the IMF said in its regional economic outlook report for the Middle East and Central Asia. "Oil prices at these levels could result in more than $230 billion in lost annual revenue across MENAP [Middle East, North Africa, Afghanistan and Pakistan] oil exporters, compared with October projections, placing significant strains on fiscal and external balances." Mideast growth to fall to -2.8pc this year: IMF - As the coronavirus (COVID-19) pandemic sweeps across the world, growth in the Middle East and Central Asia region is projected to fall from 1.2 percent in 2019 to –2.8 percent in 2020, lower than the growth rates during the 2008 global financial crisis and the 2015 oil price shock, says an IMF report. The growth will rise to 4 percent in 2021, as threats from the virus recede and global policy efforts spur recovery. In GCC countries, growth is projected to contract by 2.7 percent in 2020. Non-oil activity is expected to be a major drag on the near-term outlook, contracting by 4.3 percent this year, a significant downward revision from the 2.3 percent growth projected in the October 2019 Regional Economic Outlook for the Middle East and Central Asia. Saudi central bank says there could be more G20 action on swap lines - Saudi Arabia's central bank governor said on Wednesday G20 nations had worked on setting up currency swap lines and repo facilities to tackle the fallout from the coronavirus pandemic and they could take further action on bilateral swap lines. "At the same time we will be looking to see more actions as the crisis unfolds, it will be bilateral swap lines,". GCC Sovereign Yields Maturity Yield % Abu Dhabi 2027 2.50 Price ∆ (YTD %) -0.97 Abu Dhabi 2047 3.62 Bahrain 2024 Bahrain 2029 Bahrain Dubai Sovereigns Dubai Maturity Yield % KSA 2025 2.82 Price ∆ (YTD %) -2.75 -6.81 KSA 2029 3.14 -2.76 6.65 -11.07 KSA 2049 4.50 -10.08 7.28 -18.26 Oman 2025 7.12 -13.56 2047 7.81 -22.04 Oman 2029 9.74 -26.60 2023 3.47 -3.82 Oman 2048 9.77 -30.36 2029 4.44 Sovereigns -10.12 Qatar 2024 2.25 Sovereign Ratings Moody’s S&P Abu Aa2 AA Dhabi Bahrain B2u B+ Aa2 AA- AA Oman Ba2 BB- BB Qatar Aa3 AA- AA- -0.89 KSA A1 A-u A Aa2 NR NR B2 Kuwait 2022 1.52 0.35 Qatar 2028 2.86 -3.01 Kuwait 2027 2.19 0.35 Qatar 2049 3.87 -6.58 Egypt Source: Bloomberg Bonds and Sukuk Indices Yield % 4.39 1D ∆ (%) -0.10 Duration (yrs) 7.50 S&P MENA Bond and Sukuk Index YTD ∆ (%) -6.15 NA -0.16 -3.53 Bloomberg Emerging Markets USD Index 6.77 6.58 -0.16 -7.63 Bloomberg Global Aggregate Index 1.11 7.47 0.04 0.72 Interbank Rates (%) KIBOR SAIBOR BHIBOR QATAR AEIBOR EURIBOR LIBOR 3 Months 16/04/2020 31/12/2019 1.9375 2.7500 1.2286 2.2314 1.8000 2.2500 1.2643 2.2500 1.7313 2.2086 -0.2480 -0.3830 1.1761 1.9084 6 Months 16/04/2020 31/12/2019 2.1875 2.9375 1.2314 2.2557 2.1000 2.7000 1.3202 2.3500 1.5830 2.1914 -0.1950 -0.3240 1.1588 1.9121 USD Swap Rates 1-Year 2-Year 5-Year 7-Year 10-Year 30-Year Yield % 0.5300 0.4074 0.4669 0.5735 0.6970 0.8836 YTD ∆ (%) -70.1 -76.0 -73.0 -68.1 -63.2 -57.8 US Treasuries 2-Year 5-Year 10-Year 30-Year 12 Months 16/04/2020 31/12/2019 2.3750 3.1875 1.2314 2.3071 2.3167 2.8333 1.4311 2.5333 1.4194 2.2900 -0.1050 -0.2490 1.0259 1.9963 Currencies 1D ∆ (bps) -1.07 -0.26 0.12 -0.12 -0.29 -1.19 KWD SAR BHD QAR OMR AED USD 0.3124 3.7626 0.3780 3.6845 0.3854 3.6731 UK Guilts Yield % 0.20 0.34 0.63 1.26 1D ∆ (%) 0.00 -0.01 0.02 0.21 Yield % 0.02 0.12 0.30 0.68 1D ∆ (bps) -0.0738 0.0133 0.0159 -0.3510 -0.0182 0.0000 YTD ∆ (%) -2.79 -0.24 -0.14 -0.47 0.04 0.00 German Bunds 1D ∆ (%) 0.00 0.00 0.00 0.00 Yield % -0.72 -0.68 -0.49 -0.07 1D ∆ (%) -0.01 -0.05 -0.13 -0.47 B B+ Lebanon Ca SD RD Turkey B1 B+u BB- Tunisia B2 NR B+ Morocco Ba1 BBBJordan B1 B+ BBBBB- China A1 A+ A+ UK Aa2 AA AA USA Aaa AA+u USD 5-Year CDS Abu Dhabi 129 Kuwait 107 Dubai 260 AAA YTD ∆ (%) 280 200 213 Bahrain 448 162 Qatar 132 282 KSA 165 205 Egypt 591 117 Oman 657 185 Turkey 604 114 Iraq 932 167 Morocco 173 101 China 39 35 France 39 128 Germany 24 201 Japan 24 83 UK 36 94 US 18 68 129 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. AA BB- Kuwait UAE Index Name Bloomberg GCC FI Index Fitch 280