MENA Daily Fixed Income Report - 19 April

Transcription

1. MENA Daily Fixed Income Report – 19 April 2020 Kuwait Financial Centre “Markaz” News The Gulf Cooperation Council (GCC) approved Kuwait's proposal to establish a common food supply safety network - The official Kuwaiti News Agency (KUNA) quoted the Ministry of Commerce as saying that members had instructed the General Secretariat of the Council to complete a technical study of the proposal, and approve it. Dubai RTA posts 28% surge in e-licensing - Dubai’s Roads and Transport Authority (RTA) has recorded a total of 254,203 licensing transactions in March compared to 198,895 transactions during March 2018, reflecting a 28 per cent increase. The surge of online transactions reported in March, be it through the website, Dubai Drive and RTA apps, is mainly attributed to customers response to RTA’s preventive measures rolled out at the start of March to cope with the outbreak of the Covid-19 Junk Bond Ratings Keep Getting Better - Junk indexes have noticeably improved in quality over the last few weeks. Bonds rated BB- or better now comprise 50% of the global high-yield market, up from 45% in November. Fallen angels dropping out of high grade helped push the market cap of the BB index to a record high of $668 billion on Wednesday. The secondlargest borrower in the Bloomberg Barclays Global High Yield index, and the largest in the U.S. Corporate High Yield index is now Ford. ECB Is Flexible and Could Do More If Needed, Officials Say - The European Central Bank could take further action if needed to support the euro area through the economic crisis sparked by the coronavirus outbreak, policy makers at the institution said. The central bank has already unleashed a barrage of support over the past few weeks to cushion countries across the bloc, including committing to spend more than 1 trillion euros ($1.1 trillion) on public and private debt this year. Yet even with such an unprecedented monetary boost, tensions are growing on markets and policy makers expect inflation will likely remain below the ECB’s 2% target for a long time. Debt Relief for Poor Nations Not an Easy Sell to Bondholders - A pause in debt payments for the world’s poorest countries to help them battle the coronavirus will be a hard sell for private creditors. The Group of 20 leading economies last week heeded calls from African finance ministers to grant a debt waiver of about $20 billion until the end of the year, and asked private creditors to step up. Groups representing commercial creditors, who snapped up bonds from low-income countries in recent years amid record-low yields in developed markets, said they would be willing to participate. But a deferral of sovereign bond payments will be far from easy. GCC Sovereign Yields Maturity Yield % Abu Dhabi 2027 2.48 Price ∆ (YTD %) -0.85 Abu Dhabi 2047 3.65 Bahrain 2024 Bahrain 2029 Bahrain Dubai Sovereigns Dubai Maturity Yield % KSA 2025 2.63 Price ∆ (YTD %) -1.89 -7.38 KSA 2029 3.12 -2.59 6.49 -10.59 KSA 2049 4.46 -9.46 7.28 -18.01 Oman 2025 7.13 -13.52 2047 7.95 -22.63 Oman 2029 9.72 -26.61 2023 3.63 -4.12 Oman 2048 9.86 -30.65 2029 4.55 Sovereigns -10.78 Qatar 2024 2.17 Sovereign Ratings Moody’s S&P Abu Aa2 AA Dhabi Bahrain B2u B+ Aa2 AA- AA Oman Ba2 BB- BB Qatar Aa3 AA- AA- -0.57 KSA A1 A-u A Aa2 NR NR B2 Kuwait 2022 1.41 0.48 Qatar 2028 2.81 -2.68 Kuwait 2027 2.17 0.46 Qatar 2049 3.85 -6.37 Egypt Source: Bloomberg Bonds and Sukuk Indices Yield % 4.30 1D ∆ (%) 0.35 Duration (yrs) 7.50 S&P MENA Bond and Sukuk Index YTD ∆ (%) -5.75 NA 0.22 -3.10 Bloomberg Emerging Markets USD Index 6.63 6.58 0.25 -7.39 Bloomberg Global Aggregate Index 1.11 7.47 0.06 0.71 Interbank Rates (%) KIBOR SAIBOR BHIBOR QATAR AEIBOR EURIBOR LIBOR 3 Months 19/04/2020 31/12/2019 1.8750 2.7500 1.2286 2.2314 1.8000 2.2500 1.2400 2.2500 1.5771 2.2086 -0.2430 -0.3830 1.1090 1.9084 6 Months 19/04/2020 31/12/2019 2.1250 2.9375 1.2314 2.2557 2.0833 2.7000 1.2833 2.3500 1.5897 2.1914 -0.1950 -0.3240 1.1025 1.9121 USD Swap Rates 1-Year 2-Year 5-Year 7-Year 10-Year 30-Year Yield % 0.5465 0.4161 0.4782 0.5868 0.7128 0.8952 YTD ∆ (%) -69.1 -75.5 -72.3 -67.4 -62.4 -57.2 US Treasuries 2-Year 5-Year 10-Year 30-Year 12 Months 19/04/2020 31/12/2019 2.3750 3.1875 1.2314 2.3071 2.2667 2.8333 1.3833 2.5333 1.6383 2.2900 -0.1050 -0.2490 0.9819 1.9963 Currencies 1D ∆ (bps) -1.15 -0.91 -0.33 0.29 1.01 2.63 KWD SAR BHD QAR OMR AED USD 0.3127 3.7597 0.3783 3.6630 0.3852 3.6733 UK Guilts Yield % 0.20 0.36 0.64 1.26 1D ∆ (%) 0.01 -0.01 -0.14 -0.94 Yield % 0.08 0.17 0.30 0.68 1D ∆ (bps) -0.1251 -0.0293 -0.0318 -0.0382 0.0000 0.0000 YTD ∆ (%) -2.80 -0.15 -0.20 -0.08 -0.03 0.00 German Bunds 1D ∆ (%) -0.05 -0.12 -0.06 -0.22 Yield % -0.72 -0.69 -0.51 -0.07 1D ∆ (%) 0.01 0.02 -0.01 -0.49 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 127 Kuwait 107 Dubai 260 AAA YTD ∆ (%) 276 200 213 Bahrain 446 160 Qatar 119 250 KSA 157 188 Egypt 607 123 Oman 685 196 Turkey 627 121 Iraq 932 167 Morocco 177 105 China 42 42 France 39 128 Germany 22 201 Japan 34 84 UK 35 87 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