MENA Daily Fixed Income Report - 26 January

Transcription

1. MENA Daily Fixed Income Report – 26 January 2021 Kuwait Financial Centre “Markaz” News Updates Kuwait draft budget foresees narrower deficit for fiscal 2021/22 – Kuwait's finance ministry has proposed a draft 23.05 billion dinar ($76.2 billion) budget for the fiscal year starting on April 1, it said on Monday, forecasting a lower deficit for the coming fiscal year. The Gulf state, which despite its wealth is facing a large deficit due to lower oil prices and a liquidity crunch due to a political deadlock, expects a deficit of 12.1 billion dinars in fiscal 2021/2022 - 13.8% narrower than the deficit budgeted for the year ending on March 31. An OPEC member state, Kuwait has been hit hard by lower crude prices and the coronavirus pandemic. Repeated rows and deadlocks between cabinet and the elected assembly have led to successive government reshuffles and dissolutions of parliament, hampering much needed economic reforms. The finance ministry based its 2021/2022 proposed budget on an oil prices assumption of $45 per barrel and on a production of 2.4 million barrels per day, it said. That compares with an average oil price of $30 per barrel underlying its budget for the year ending in March 2021, and translates into expectations of annual revenues of 10.9 billion dinars in the next fiscal year, a 45.6% increase. Kuwait plans to boost spending by 6.9% in the coming fiscal year. (Source: Zawya) APICORP mandates lenders for 5-year dollar bonds – The Arab Petroleum Investments Corporation (APICORP) has mandated banks to arrange investor calls ahead of a potential international bond issue, Reuters said on Monday citing a document issued by one of the banks. The calls will begin on Monday and a Regulation S five-year US dollardenominated bond deal will follow as per market conditions. Saudi Arabiabased APICORP named BofA Securities, China Construction Bank, Citi, Emirates NBD Capital, Maybank, Nomura, and Standard Chartered. GCC Sovereign Yields Abu Dhabi 2025 0.84 Abu Dhabi 2030 1.70 Abu Dhabi 2050 2.85 Bahrain 2026 Bahrain 2030 Bahrain Dubai 2025 1.18 -1.01 KSA 2030 2.23 -1.64 KSA A1 A-u A -1.88 KSA 2050 3.45 -3.10 UAE Aa2 NR AA- 3.38 -0.54 Oman 2025 3.73 1.50 AA AA -2.30 Oman 2029 5.44 -0.21 Abu Dhabi Aa2 5.08 Qatar Aa3 AA- AA- 2047 6.37 -3.27 Oman 2048 6.92 -2.20 2029 2.43 0.44 Qatar 2025 0.89 -0.24 Bahrain B2 B+ B+ Oman Ba3 B+ BB- Egypt B2 B B+ Lebanon C SD RD Jordan B1 B+ BB- Turkey B2 B+u BB- Tunisia B2 NR Yield % Sovereigns Maturity Yield % 2022 0.44 -0.47 Qatar 2030 1.76 -1.18 Kuwait 2027 1.22 -0.80 Qatar 2050 2.92 -1.61 Bonds and Sukuk Indices Yield % Duration (yrs) 1D ∆ (%) YTD ∆ (%) Bloomberg GCC FI Index 2.52 8.08 0.06 -0.47 S&P MENA Bond and Sukuk Index 1.63 NA 0.09 -0.58 Bloomberg Emerging Markets USD Index 3.58 6.80 0.17 -0.77 Bloomberg Global Aggregate Index 0.86 7.42 0.10 -0.61 Index Name Interbank Rates (%) 3 Months 26/1/2021 31/12/2020 1.4375 1.4375 0.8163 0.8175 2.2333 2.2500 1.0054 1.1206 0.3454 0.5125 -0.5400 -0.5450 0.2153 0.2384 6 Months 26/1/2021 31/12/2020 1.6875 1.6875 0.8663 0.8700 2.5167 2.5333 1.1102 1.1960 0.4844 0.4908 -0.5250 -0.5260 0.2360 0.2576 USD Swap Rates 1-Year 2-Year 5-Year 7-Year 10-Year Bahrain will likely need further Gulf financial support - Fitch – 30-Year Bahrain will likely need further financial support from its Gulf neighbours despite reform measures, Fitch Ratings’ lead Bahrain analyst Toby Iles said on Monday. Iles said Bahrain, a small oil producer, was likely to likely need the support from 2023 onwards and cited Fitch’s oil price assumption. In 2018, Saudi Arabia, the United Arab Emirates and Kuwait came to Bahrain’s aid with a five-year zero-interest $10.25 billion package to help it avoid a credit crunch. (Source: Reuters) KSA Price ∆ (YTD %) -0.13 Maturity Kuwait KIBOR SAIBOR BHIBOR QATAR AEIBOR (Source: Mubasher) Oman Electricity Transmission Co hires banks for dollar bonds – EURIBOR Oman Electricity Transmission Company has hired banks to arrange a LIBOR U.S.-dollar denominated issuance of seven-year or 10-year bonds, a document showed on Monday. Bank ABC, First Abu Dhabi Bank, JPMorgan, National Bank of Oman and Standard Chartered will arrange investor calls starting on Monday, the document from one of the banks showed. A fixed-rate Rule 144A/Regulation S senior unsecured bond offering with a tenor of seven or 10 years will follow, subject to market conditions. (Source: Reuters) Sovereign Ratings Price ∆ (YTD %) -0.35 Sovereigns Yield % 0.1896 0.1989 0.5060 0.7730 1.0694 1.5580 Currencies 1D ∆ (bps) 0.02 0.14 0.52 0.62 0.68 0.37 YTD ∆ (%) -1.5 0.6 17.7 18.1 15.6 11.1 US Treasuries 2-Year 5-Year 10-Year 30-Year 12 Months 26/1/2021 31/12/2020 1.9375 1.9375 0.9388 0.9413 2.6833 2.6833 1.2800 1.3636 0.5293 0.6538 -0.4980 -0.4990 0.3123 0.3419 KWD SAR BHD QAR OMR AED USD 0.3028 3.7513 0.3770 3.6413 0.3850 3.6730 UK Guilts Yield % 0.12 0.41 1.04 1.79 1D ∆ (%) 0.00 -0.02 -0.05 -0.02 Yield % -0.15 -0.07 0.26 0.83 1D ∆ (bps) 0.0000 -0.0027 0.0027 -0.0027 0.0000 0.0000 YTD ∆ (%) 0.18 0.01 0.01 0.00 0.00 0.00 German Bunds 1D ∆ (%) 0.01 0.12 0.53 1.46 Yield % -0.68 -0.78 -0.64 -0.14 1D ∆ (%) 0.01 0.09 0.35 1.23 Moody’s S&P Kuwait A1 AA- Fitch AA B Morocco Ba1 BBB- BB+ US Aaa AA+u AAA UK Aa2 AAu AA- China A1 A+ A+ USD 5Yr CDS 26-Jan 2021 31-Dec 2020 Kuwait 41.69 40.69 KSA 68.11 63.77 Abu Dhabi 43.61 36.03 Dubai 106.68 104.06 Qatar 43.93 36.70 Bahrain 230.33 233.58 Oman 333.84 353.60 Iraq 552.30 542.74 Egypt 309.98 330.47 Morocco 98.27 102.56 Turkey 327.53 299.47 US 10.00 11.52 UK 15.30 15.13 China 29.72 26.70 Japan 13.89 14.74 Germany 9.00 9.09 France 14.67 14.42 Source: Bloomberg 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.