Weekly Market Review March 15, 2015 March 21, 2015

Transcription

1 Weekly Market Review March 15, 2015 March 21, 2015 March 22, 2015

2 CONTENTS International Equity Markets GCC Equities Currencies Commodities Interest Rates Equity Markets - Top Most & Bottom Most Commodity Markets - Top Most & Bottom Most Page I 2

3 INTERNATIONAL EQUITY MARKETS US 4Q2014 current account deficit widened to $113.5bn vs. $98.9bn in 3Q2014 as exports and income receipts fell 1.3% to $820.9bn, reflecting softer demand in Europe and Asia Initial jobless claims fell slightly by 1,000 to a seasonally adjusted 291,000 for the week ended March 14 Housing starts plunged 17% in Feb to 897,000 units as harsh weather kept building crews at home The ECB and the Euro zone's national central bank s balance sheet expanded by 7.298bn to 2.142tn in the week ended March 13, as ECB began buying sovereign bonds aimed at pumping 1tn in the Euro zone economy Euro zone Feb consumer prices rose 0.6% MoM and fell 0.3% YoY as prices of fuel & heating oil declined European Union has offered Greece 2bn to boost growth, cut unemployment and help the poorest citizens German cabinet approved plans to boost spending by 15bn over the next 4 years on infra, foreign aid & defense ZEW s monthly survey of economic sentiment increased to 54.8 in Mar from 53.0 in Feb Britain raised official growth forecast for 2015 & 2016 to 2.5% & 2.3% from earlier 2.4% & 2.2%, respectively Unemployment rate stood stable at 5.7% in Jan, matching its lowest level in almost seven years OECD predicts China to grow by 7% & 6.9% in 2015 & 2016, respectively as govt. pushes currency & int. rate reform FDI in Feb rose just 0.9% YoY to $8.6bn, down 38% from $13.9bn recorded in Jan Average new home prices in 70 major cities dropped 5.7% YoY in Feb, recording its 6 th consecutive fall Japan s Feb exports rose 2.4% YoY in Feb whereas imports declined 3.6%, leaving a trade deficit of 424.6bn Thomson Reuters/INSEAD Asian Business Sentiment Index dipped marginally to 71 in 1Q2015 vs. 72 in 4Q2014 India s current account deficit narrowed to 1.6% of GDP in 4Q2014 from 2% in 3Q2014 led by slumping oil prices Brazilian Central Bank s IBC-Br economic activity index dropped a seasonally adjusted 0.11% MoM in Jan Colombia's economy grew 4.6% in 2014 while growth in 4Q2014 slowed to 3.5% as the oil-price drop accelerated Venezuela plans to limit dollar disbursement for food imports in order to pay $8.4bn in debt services by 2015-end Last Close Change 5 Day % YTD % S&P 500 2, DJI 18, Nasdaq Comp 5, Euro Stoxx FTSE 100 7, Dax 12, CAC 40 5, Nikkei , Hang Seng 24, Brazil - Bovespa 51, , Russia - Micex 1, BSE Sensex 28, Shanghai Comp 3, S&P year performance Euro Stoxx year performance Page I 3

4 GCC EQUITIES Arabtec Holding reported a decline in FY2014 net profit to AED214.6mn from AED377.8mn in FY2013 Etihad Airways secured full aircraft financing with Korean investors for $428mn Airbus A380 superjumbo Port & Free Zone World completed a $1.2bn loan deal to help it meet group & subsidiary level commitments DP World posted an increase of 11.8% YoY in FY2014 net income attributable to shareholders to $675mn Ras Al Khaimah Ceramics reported its adjusted net income increased 14.1% YoY to AED338.3mn in FY2014 Daman Investments will launch an IPO over next few weeks as it is in final stages of obtaining regulatory approvals Majid Al Futtaim plans to invest EGP4.5bn in Egypt, in addition to an existing EGP18bn 5-year investment plan Mashreq Bank has joined the list of potential buyers for Citigroup s Egyptian consumer banking operations Drake & Scull Engineering signed an AED395mn JV contract with Habtoor Leighton Specon for Dubai International Real Estate s Jewel of the Creek Package 8 complex project Oman & Emirates Inv. Hold. received approval from Abu Dhabi Inv. extending repayment of AED71.48mn govt. loan Zamil Central Air Conditioners Co. won SAR348mn contract from Saudi Real Estate Develop. Co. to supply chillers Rabigh Refining & Petrochemical Co. signed loans worth SR19.4bn for expanding its petrochemical complex in Saudi Sadara Basic Services Co. amended its Article of Association to increase share capital by SAR2.06bn to SAR11.76bn Islamic Development Bank approved a $718mn funding partnership with Bill & Melinda Gates Foundation Gammon Saudi Arabia plans to invest $4.5bn on thermal power projects in India Savola Group slashed its forecast for net income (before capital gain) in 1Q2015 by 50% to SAR178mn The Commercial Bank of Qatar received shareholders approval to raise capital worth QAR3.6bn Qatar International Islamic Bank s shareholders approved proposal to raise up to $3bn through a Sukuk issue Bahrain-based Investcorp acquired four US residential properties worth $300mn through its real estate arm in US Bahrain s Gulf Finance House seeks shareholders approval to reduce its capital from $1.49bn to $597.99mn Last Close Change 5 Day % YTD % Dubai 3, Abu Dhabi 4, Saudi Tadawul 9, Qatar Index 11, Kuwait Index 6, Oman MSM 30 6, Bahrain All Share 1, Egypt EGX 30 9, Istanbul 100 Index 82, , DFMGI 1 year performance Saudi Tadawul 1 year performance Page I 4

5 CURRENCIES US dollar capped its worst weekly performance against euro in more than two years, weakening 3.1% to per euro on expectations that US interest rates will rise more slowly than previously expected Chinese Yuan appreciated 0.87% in the week to per dollar as Premier Li Keqiang said on March 15 the government will ensure economic expansion, while pressing ahead with reforms and increasing the Yuan's convertibility under the capital account Russian ruble advanced 4.7% in the week to per dollar on demand from companies rushing to meet a tax deadline and as crude oil prices rebounded Brazil s real climbed approximately 0.6% in the week to per dollar after financial newspaper Valor Economico reported that tax revenue was better than expected in Feb, and the central government was headed for a second straight month of surpluses excluding interest payments The Philippine peso declined 1.5% in the week to per dollar, the most since the week ended Mar 21, 2014, on slowing remittances growth and amid speculation President Benigno Aquino will find it hard to push through policy changes as his popularity wanes Malaysia s ringgit dropped for a 3 rd week by 1.3% to per dollar as Fitch Ratings said it would probably downgrade the nation and as the price of crude oil slid to a six-year low Last Close Change 5 Day % YTD % EUR/USD GBP/USD AUD/USD USD/JPY USD/CHF USD/CAD USD/BRl USD/RUB USD/INR USD/CNY DXY Index EUR/USD 1 year performance GBP/USD 1 year performance Page I 5

6 COMMODITIES Brent crude snapped two straight weeks of losses, rising 0.56% after the dollar fell on interest-rate uncertainty, lifting demand for dollar-denominated commodities from holders of other currencies Gold climbed more than 2% whereas silver jumped 6.96% in the week after the US Federal Reserve's cautious note on interest rates arrested a dollar rally and sparked broad-based buying of commodities Copper rose 3.7% in the week to reach its highest since Jan 8 as the falling dollar makes the currency cheaper to foreign buyers. Prices also got support from short coverings by some traders as prices moved up Cotton futures rose 3.8% in the week to post largest weekly gain in six months as a weaker dollar supports greenback-traded commodities such as cotton by making them more attractive to holders of other currencies Wheat futures gained 4.2% in the week as investors used a sharp drop in the dollar as an excuse to cover short positions ahead of the weekend. Wheat received additional support from concerns about dryness in the US Plains hindering crop development Last Close Change 5 Day % YTD % Gold spot 1, Silver spot Copper-CMX Brent - ICE WTI - Nymex S&P GSCI Spot Index Baltic Dry Index Palm oil shipments from Indonesia, the world s largest producer, fell for a fourth month in Feb to 1.79mn tons from 1.8mn tons in Jan, the longest slump in at least seven years after China cut purchases of the cooking oil used in food and fuel. WTI Crude 1 year performance GOLD 1 year performance Page I 6

7 INTEREST RATES US 10-year yield dropped 18.4 bps in the week to 1.93% as traders reverted to buying US government bonds on the view that the Fed would likely keep rates low until at least September UK government bonds climbed for a second week sending yields down 19.3 bps to 1.52% as policy makers from the Bank of England and the Federal Reserve boosted speculation that interest rates around the world will remain lower for longer than economists forecast Italy s 10-year yield rose 5.4 bps in the week to 1.20% as a larger-than-anticipated debt offering of 2032 bonds by Italy stoked investor s concern that countries would seek to flood the market with supply to take advantage of borrowing costs at record lows Switzerland's central bank kept its charge on major cash deposits at the central bank at 0.75%. It also held its target range for the three-month Libor rate at -1.25% to -0.25% Sweden s central bank cut its benchmark repo rate by 0.15 percentage points to -0.25% and said will buy government bonds worth 30bn Swedish kronor, to support the upturn in inflation Last Close Change 5 Day % YTD % USD-1w Libor USD-3m Libor USD-6m Libor USD-10yr AED-1m EIBOR AED-3m EIBOR AED-12m EIBOR UK-10yr Japan-10yr Norway s central bank unexpectedly left the overnight deposit rate unchanged at 1.25% and signaled another cut to protect the economy against a plunge in oil prices US 10 year Generic Yield 1 year performance UK 10 year Generic Yield 1 year performance Page I 7

8 EQUITY MARKETS - TOP MOST & BOTTOM MOST WEEKLY YTD Ref Country Weekly Change Weekly Change (USD Adj.) 1 Argentina 11.13% 10.93% 2 Turkey 7.65% 10.39% 3 China 7.25% 8.18% 4 Brazil 6.94% 7.53% 5 Poland 4.53% 8.21% 6 Portugal 4.27% 7.50% 7 United Kingdom 4.18% 5.63% 8 Slovakia 3.76% 6.97% 9 Spain 3.50% 6.70% 10 Russia 3.43% 3.43% Ref Country YTD Change YTD Change (USD Adj.) 1 Argentina 32.71% 27.69% 2 Portugal 24.75% 11.58% 3 Denmark 23.25% 10.12% 4 Germany 22.78% 9.82% 5 Italy 21.91% 9.04% 6 Finland 20.62% 7.89% 7 Venezuela 20.47% 20.47% 8 France 19.07% 6.50% 9 Ireland 18.36% 5.87% 10 Netherlands 17.59% 5.17% Ref Country Weekly Change Weekly Change (USD Adj.) 1 Dubai UAE -6.32% -6.32% 2 Saudi Arabia -5.33% -5.34% 3 Qatar -4.61% -4.62% 4 Nigeria -4.51% -4.37% 5 Mongolia -3.63% -3.72% 6 Pakistan -3.43% -3.76% 7 Greece -3.34% -0.35% 8 Abu Dhabi UAE -3.25% -3.25% 9 Oman -2.81% -2.82% 10 Ukraine -2.03% -3.36% Ref Country YTD Change YTD Change (USD Adj.) 1 Nigeria % % 2 Colombia % % 3 Peru % % 4 Kazakhstan % % 5 Mongolia % % 6 Greece -9.90% % 7 Dubai UAE -7.96% -7.96% 8 Cyprus -7.27% % 9 Qatar -6.20% -6.18% 10 Mauritius -5.68% % Page I 8

9 COMMODITY MARKETS - TOP MOST & BOTTOM MOST WEEKLY YTD Ref Commodity Weekly Change 1 Coffee 13.36% 2 Silver 6.96% 3 Steel Rebar 6.44% 4 Lumber 5.17% 5 Rough Rice 4.65% 6 Wheat 4.18% 7 Cotton 3.83% 8 Copper 3.66% 9 Ethanol 3.12% 10 Corn 2.94% Ref Commodity YTD Pct Change 1 Gasoline 25.26% 2 Rubber 9.46% 3 Silver 6.67% 4 Cotton 4.23% 5 Aluminium 2.78% 6 Gasoil 2.64% Ref Commodity Weekly Change 1 Lean Hogs -5.88% 2 Palm Oil -4.49% 3 Bean Meal -4.14% 4 Cocoa -3.86% 5 Palladium -2.11% 6 Rubber -1.46% 7 Natural Gas -1.07% 8 WTI Crude -1.04% 9 Sugar -0.16% 10 Tin -0.03% Ref Commodity YTD Pct Change 1 Lean Hogs % 2 Orange Juice % 3 WTI Crude % 4 Lumber % 5 Coffee % 6 Sugar % 7 Steel Rebar % 8 Bean Meal % 9 Tin % 10 Wheat % Page I 9

10 IMPORTANT NOTICE This report was prepared by the Private Banking Unit of Mashreqbank psc ( Mashreq ) in the United Arab Emirates ( U.A.E. ). Mashreq is regulated by the Central Bank of the U.A.E. This report is provided for informational purposes and private circulation only and should not be construed as an offer to sell or a solicitation to buy any security or any other financial instrument or adopt any hedging, trading or investment strategy. Prior to investing in any product, we recommend that you consult with a professional financial advisor, taking into consideration investment objectives, financial circumstances and tax implication. While based on information believed to be reliable, we do not guarantee and make no express or implied representation as to the accuracy of this report or complete description of the securities markets or developments referred to in this report. The information, opinions, forecasts (if any), assumptions or estimates contained in this report are as of the date indicated and are subject to change at any time without prior notice. The stated price of any securities mentioned in this report is as of the date indicated and is not a representation that any transaction can be effected at this price. The risks related to investment products described in this report are not all encompassing and investors should refer to the relevant investment offer document for detailed information and applicable terms and conditions. Investment products, including treasury products, are not guaranteed by Mashreq or any of its affiliates or subsidiaries unless stated otherwise and are subject to investment risk, including loss of principal. Investment products are not government insured. Past performance is not an indicator of future performance. US persons (US Citizens; US Green Card Holders; Resident Aliens subject to US income taxes for IRS purposes) are not eligible for any of the investment products introduced by Mashreq unless stated otherwise. This report is for distribution only under such circumstances as may be permitted by applicable law. Neither Mashreq nor its officers, directors or shareholders or other persons shall be liable for any direct, indirect, incidental or other damages including loss of profits arising in any way from the information contained in this report. This report is intended solely for the use by the intended recipients and the contents shall not be reproduced, redistributed or copied in whole or in part for any purpose without Mashreq s prior express consent. Page I 10