Weekly Investment Report

Transcription

1 Economic & Market News Reuters: China s exports and import growth eased in October in a sign the world s second-largest economy is starting to cool after a strong first half, with momentum seen slackening further as Beijing s crackdown on pollution hits factory output. The trade data also showed China s goods surplus with the United States, historically a sore spot in relations between the two nations. October exports rose 6.9% from a year earlier in dollar terms, slightly lagging analysts forecast of a 7.2% increase compared to 8.1% growth in September. Imports grew 17.2% year-on-year in October, beating forecast of 16.% growth but slightly slower than the 18.7% rise in September. Taken together, analysts say, the numbers reinforced recent signs of a cooling in economic momentum as the war on smog and tighter rules to reduce China s years-long addiction to debt drags on overall activity. The latest data showed shipments to the US rose 8.3% year-on-year in October, while imports increased 4.3%. That resulted in USD 26.6 billion trade surplus with the U.S. last month, based on Reuters calculations of official data, down from a record USD 28.1 billion in September. But the surplus was still above recent trends and could keep trade tensions high, analysts say. Zawya: October data signalled a strong start to the final quarter of 217 for Saudi Arabia s non-oil private sector. Sharp growth of both output and new orders contributed to latest improvement in operating conditions. On the price front, an uptick in cost pressures was recorded, which according to anecdotal evidence led to higher selling prices. Business confidence improved during October, prompting firms to increase stocks of purchases at a record rate in anticipation of further improvements in economic conditions. The headline seasonally adjusted Emirates NBD Saudi Arabia PMI rose to 55.6 in October, up from 55.5 in September. This indicated a steep expansion in Saudi Arabia s non-oil private sector but the pace of growth remained below the long-run series average. Incoming new business grew at a steep rate during October. Panel member reports suggested that strong domestic demand contributed to the latest improvement in order books. New export orders grew for the third month running, albeit at a fractional pace overall. The upturn in demand for Saudi-produced goods and services led to sharp growth in output, according to anecdotal evidence. That said, the rate of expansion eased since the preceding survey period. Al Masah Capital: Geo-political tensions across the region weighed down on regional markets performances with five out of the eight indices ending the week in the red. Dubai, Kuwait and Qatar were on top of the losing team with -4.8%, -4.4% and -3.8%, respectively. Abu Dhabi and Bahrain ended the week with -2.% and -1.2%, respectively, while the Saudi market was almost flat. On the other hand, Oman and Egypt ended the week with a modest +.3% and +.2%, respectively. Despite the negative trend, crude oil remained above USD63 per barrel, ending the week at USD63.52 per barrel, while WTI was at USD56.74 per barrel. Regional geo-political pressures will be driving investors cautiousness for the coming period, however the recent selling has opened new opportunistic entry points. Indexes Last WTD (%) MTD (%) YTD (%) Dubai (DFMGI) 3, % -5.12% -2.3% Abu Dhabi (ADSMI) 4, % -2.31% -3.74% Saudi (SASEIDX) 6, %.29% -3.55% Kuwait (KWSE) 6, % -3.92% 8.88% Egypt (EGX3) 14, %.5% 16.24% Qatar (DSM) 7, % -3.42% % Bahrain (BHSEIDX) 1, % -.71% 3.86% Oman (MSM3) 5, %.89% % TR GCC (Reuters) % -3.95% -8.31% DJ MENA %.% 5.77% Indexes Last WTD (%) MTD (%) YTD (%) DJI 23, %.19% 18.52% S&P 5 2, %.27% 15.34% NASDAQ 6, %.97% 29.72% STOXX Europe % -1.65% 7.55% FTSE 1 7, % -.8% 4.6% DAX 13, % -.77% 14.34% Commodities & FX Last WTD (%) MTD (%) YTD (%) Oil (Brent) % -1.43% 62.26% Natural Gas % -.1% 23.79% Gold %.22% 2.9% Silver % 2.58% 23.79% EURUSD %.16% 7.39% GBPUSD % -.71% -1.52% USDJPY % -.8% -5.63% USDCHF % -.19% -.62% AUDUSD.77.14%.8% 5.31% USDCAD % -1.58% -8.37% LIBOR US Dollar WoW (%) Euro WoW (%) 1 Month % % 2 Month % % 3 Month % % 6 Month % % 12 Month % % CAC 4 5, % -2.23% 1.66% Nikkei , % 3.4% 18.66% SENSEX 33, %.31% 25.12% Shanghai Composite 3, % 1.16% 1.6% Hang Seng 29, % 3.1% 32.36% 1

2 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Weekly Investment Report Economic & Market News (continued) Reuters: Egypt s inflation dipped for the third month in a row in October after hitting a record high on energy price rises, leaving the central bank on course to begin loosening monetary policy in the coming months. Inflation climbed steadily after the central bank floated the Egyptian pound last November as part of reforms to secure a USD 12 billion International Monetary Fund loan, reaching a multi-decade high in July. Egypt also jacked up interest rates after the pound was floated and many local economists expect it to start cutting again in December or January. Annual urban consumer price inflation eased to 3.8% in October from 31.6% in the previous month, according to official data. Core inflation, which strips out volatile items such as food, fell to 3.53% from 33.26%. Inflation peaked in July after the government raised fuel prices by up to 5% and electricity prices by up to 42% in an effort to cut state spending. Narrowing the budget deficit is part of economic reforms Egypt has embarked on since it signed the IMF deal to revive an economy that has struggled since a 211 uprising drove away foreign investors and tourists. Reuters: Japan s economy was expected have grown for a seventh straight quarter in July-September, a period of unbroken expansion last seen between 1999 and 21, according to Reuters poll. Quarter-on-quarter growth of.3% is expected after a revised.6% rise in the second quarter. The poll found that private consumption, which accounts for roughly 6% of GDP, probably slipped.4% in the third quarter, the first fall in seven quarters. External demand or exports minus imports - was seen contributing.4% to growth, the poll found, after it subtracted.3% from GDP growth in April-June. Capital spending was seen rising.3% in the third quarter, growing for a fourth straight quarter, following a.5% rise the previous quarter. The Bank of Japan s corporate goods price index (CGPI), which measures the prices companies charge each other for goods and services, was seen likely to have risen an annual 3.1% in October, according to the poll. Zawya: Rising demand for residential and retail development is driving rapid expansion in Bahrain's real estate sector, with billions of dollars worth of mixed-use projects to be launched in the near future, while new regulatory measures have been issued aimed at increasing market stability and long-term growth. Real estate developments totalling USD 26 billion are planned or under construction, according to the Bahrain Economic Development Board (EDB), which comes after developers showcased five key projects worth more than USD 11 billion at the Cityscape Global property event in September. The substantial pipeline of major projects comes amid strong overall growth in real estate, led by the rising demand for residential and retail developments. The sector expanded by 4.5% in the first quarter of the year, according to the EDB, well above overall economic growth of 2.9%, and generated USD 1.7 billion, with residential sales alone jumping by 8.1% year-on-year. Meanwhile, in a sign of further growth, the number of residential applications is expected to rise by 5, units per year, according to the Ministry of Housing (MoH). Significant growth in the residential sector contrasts with greater geographic variation in demand for commercial real estate, where there is an oversupply. Regulatory reform aimed at improved stability and increased trust 4 US Government Bonds - Yield to Maturity (%) M 3M 6M 12M 2Y 5Y 1Y 3Y Last Week Current Week Global Equity Indexes - Rebased 5 CBOE S&P Volatility Index - VIX Oct-14 Dec-14 Mar-15 May-15 Jul-15 Sep-15 Nov-15 Jan-16 Mar-16 May-16 Jul-16 Sep-16 Nov-16 Jan-17 Mar-17 May-17 Jul-17 Sep-17 S&P 5 STOXX Europe 6 TR MENA MSCI Asia ex. Japan MENA Market - Price Ratios PE PB Dubai Abu Dhabi Saudi Kuwait Egypt Qatar Bahrain Oman Average Year CDS Rates (basis points) Dubai Abu Dhabi Saudi Kuwait Egypt Qatar Bahrain Oman Average 2

3 Government Bonds Government Bond Name Currency Maturity Coupon Current Yield (%) YTM - Ask (%) Rating Bid Ask UAE - Emirate of Abu Dhabi ABU DHABI GOVT INT'L USD 8/4/ Aa United States of America US TREASURY N/B USD 31/5/ AAA United Kingdom of Great Britain UK TSY 4 3/4% 22 GBP 7/3/ AA Kingdom of Bahrain KINGDOM OF BAHRAIN USD 31/3/ UAE - Emirate of Dubai DUBAI GOVT INT'L BONDS USD 5/1/ United States of America US TREASURY N/B USD 15/5/ AAA State of Qatar STATE OF QATAR USD 15/6/ Aa Arab Republic of Egypt ARAB REPUBLIC OF EGYPT USD 3/4/ B United States of America US TREASURY N/B USD 15/5/ AAA Kingdom of Bahrain KINGDOM OF BAHRAIN USD 19/9/ BB Corporate Bonds Government/Parent Company Bond Name Currency Maturity Coupon Current Yield (%) YTM - Ask (%) Rating Bid Ask Abu Dhabi Water & Electricity TAQA ABU DHABI NATL ENER USD 1/8/ BBB Abu Dhabi Water & Electricity TAQA ABU DHABI NATL ENER USD 16/9/ BBB Qatar Petroleum RAS LAFFAN LNG 3 USD 3/9/ A National Bank of Oman NATIONAL BANK OF OMAN USD 7/1/ Baa Qatari Diar Real Estate Invest QATARI DIAR FINANCE QSC USD 21/7/ Aa Stichting Waha Aerospace WAHA AEROSPACE BV USD 28/7/ AA Qatar Petroleum RAS LAFFAN LNG II USD 3/9/ A Investment Corp of Dubai EMIRATES NBD PJSC EUR 23/3/ A Saudi Electricity Co SAUDI ELECTRICITY GLOBAL USD 3/4/ A Emaar Malls Group PJSC EMG SUKUK LTD USD 18/6/ Baa Emirate of Sharjah United Arab SHARJAH SUKUK LTD USD 17/9/ BBB Qatar Petroleum RAS LAFFAN LNG 3 USD 3/9/ A Qatar Gas Transport Co Ltd NAKILAT INC USD 31/12/ A Port & Free Zone World FZE DP WORLD LTD USD 2/7/ BBB Burgan Bank SAK BURGAN TIER 1 FINANCING USD Perpetual Emirates NBD PJSC EMIRATES NBD 214 TIER 1 USD Perpetual Thomson Reuters composite rating; NR = No Rating 3

4 Bahrain Qatar Egypt Kuwait Saudi UAE Weekly Investment Report Money Markets EIBOR 1 Week 1 Month 2 Months 3 Months 6 Months 12 Months N/A T/N 1 Week 1 Month 2 Months 3 Months 6 Months 9 Months 12 Months Year 2 Years 3 Years 4 Years 5 Years 7 Years 1 Years SAIBOR KIBOR 1 Month 2 Months 3 Months 6 Months 9 Months 12 Months T/N 1 Week 1 Month 2 Months 3 Months 6 Months 9 Months 12 Months Year 2 Years 3 Years 4 Years 5 Years 7 Years 1 Years O/N 1 Month 3 Months 6 Months 1 Year 2 Years 3 Years EGIBR Bank Rates T-Bill Yields QIBOR QCB Interest Rates BHIBOR Interest Rates O/N T/N 1 Week 1 Month 2 Months 3 Months 6 Months 9 Months 12 Months Year 2 Years 3 Years 4 Years 5 Years 7 Years 1 Years O/N < 1 Week 1 Week < 1 Month 1 Month > 1 Month Re Discount Lending Benchmark Week 1 Month 3 Months 6 Months 9 Months 1 Year 2 Years 3 Years O/N 1 Week 1 Month 2 Months 3 Months 6 Months 9 Months 12 Months Week 1 Month 2 Months 3 Months 6 Months 9 Months 12 Months O/N Deposit O/N Lending Repo Rate O/N 1 Week 1 Month 2 Months 3 Months 6 Months 9 Months 12 Months O/N Deposit 1W Deposit O/N Repo O/N Secured Year 2 Years 3 Years 4 Years 5 Years 7 Years 1 Years

5 Qatar Egypt Kuwait Saudi Abu Dhabi Dubai Weekly Investment Report Top Weekly Performers by Country ( indicates native currency; Data as of the previous Thursday) DUBAI INSURANCE CO PSC % 27.59% 37 MASHREQBANK PSC %.% 12,42 TAKAFUL EMARAT INSURANCE PJSC % % 3 EMIRATES ISLAMIC BANK PJSC %.% 39,649 NATIONAL CEMENT CO PSC % 3.45% 1,76 DRAKE AND SCULL INTERNATIONAL % -9.9% 1,853 DXB ENTERTAINMENTS PJSC % % 5,257 ISLAMIC ARAB INSURANCE CO PSC % -4.3% 65 AMLAK FINANCE PJSC % -2.71% 1,499 DAR AL TAKAFUL PJSC % % 133 COMMERCIAL BANK INTERNATIONAL %.% 1,529 AXA GREEN CRESCENT INSURANCE CO % 25.71% 176 INVEST BANK PSC % 1.62% 3,971 FINANCE HOUSE PJSC % 6.94% 574 GULF PHARMACEUTICAL INDUSTRIES % 18.19% 2,81 ESHRAQ PROPERTIES COMPANY PJSC % % 1,651 RAS AL KHAIMAH CEMENT CO PSC % -9.59% 369 UMM AL QAIWAIN GENERAL INVEST % 15.56% 378 ARKAN BUILDING MATERIALS CO PJSC % -25.3% 1,85 ABU DHABI AVIATION % -7.% 1,241 (SAR mln) (SAR mln) DAR AL ARKAN REAL ESTATE DEV % 45.69% 9,677 KINGDOM HOLDING CO % -3.96% 3,575 NATIONAL COMMERCIAL BANK SJSC % 23.47% 15,26 SAUDI BRITISH BANK SJSC % 4.% 39,2 ADVANCED PETROCHEMICAL CO SJSC % -.22% 9,33 SAMBA FINANCIAL GROUP SJSC %.% 47,123 ASEER TRADING TOURISM % -37.6% 1,416 AL TAYYAR TRAVEL GROUP HOLDING % % 5,68 MALATH COOPERATIVE INSURANCE % -8.52% 621 SAUDI INDUSTRIAL EXPORT CO SJSC % % 237 (fils) (KWD mln) (fils) (KWD mln) AL ARGAN INTERNATIONAL REAL % -4.82% 42 GULF FRANCHISING HOLDING CO % % 2 KUWAIT NATIONAL CINEMA 1, %.% 15 UNITED PROJECTS FOR AVIATION % 22.12% 67 AQAR REAL ESTATE INVESTMENTS %.% 16 TAMKEEN HOLDING CO % % 1 AWJ HOLDING COMPANY KSCP % -2.77% 11 KUWAIT FOOD COMPANY KSCP 1,4. -2.% % 563 KUWAIT CABLE VISION COMPANY % -7.37% 1 COAST INVESTMENT AND DEV % % 21 (EGP mln) (EGP mln) ORANGE EGYPT FOR TELECOM % 85.29% 18,873 KAFR EL ZAYAT PESTICIDES % % 526 EGYPTIAN STARCH AND GLUCOSE % % 85 GENERAL COMPANY FOR PAPER % % 295 EGYPTIAN TOURAH PORTLAND % 12.29% 1,763 MIDDLE AND WEST DELTA FLOUR % 77.38% 834 ALEXANDRIA FLOUR MILLS BAKERIES % % 1,26 UNITED ARAB STEVEDORING CO SAE % 64.77% 29 AL FANAR CONTRACTING % % 9 CANAL SHIPPING AGENCIES CO % 81.39% 2,514 (QAR mln) (QAR mln) AL KHALEEJ TAKAFUL GROUP QPSC % % 293 DOHA INSURANCE CO QSC % % 723 QATARI INVESTORS GROUP QSC % -5.24% 3,652 BARWA REAL ESTATE COMPANY QPSC % -9.44% 11,823 QATAR GAS TRANSPORT CO LTD % -35.4% 8,386 ALIJARAH HOLDING CO QPSC % % 41 ISLAMIC HOLDING GROUP QPSC % % 162 MAZAYA QATAR REAL ESTATE DEVEL % % 82 QATAR INSURANCE CO SAQ % % 1,929 QATARI GERMAN COMPANY % % 68 5

6 Top 5 MENA Stocks by Market Capitalization ( indicates native currency; Latest data) Company Name Country Market Cap (USD mln) MTD % YTD % 52w High 52w Low P/E P/B Dividend Yield 1 SAUDI BASIC INDUSTRIES CORPORATION SA 79, % 9.% % 2 EMIRATES TELECOMMUNICATIONS GROUP AE 4, % -8.5% % 3 SAUDI TELECOM COMPANY SJSC SA 37, % -3.6% % 4 FIRST ABU DHABI BANK PJSC AE 3, % 1.6% % 5 QATAR NATIONAL BANK QPSC QA 29, % -18.% % 6 NATIONAL COMMERCIAL BANK SJSC SA 28, % 23.5% % 7 AL RAJHI BANKING & INVESTMENT SA 27, %.3% % 8 SAUDI ELECTRICITY COMPANY SJSC SA 26, % 8.1% % 9 DP WORLD LTD AE 19, % 35.7% % 1 SAUDI ARABIAN MINING CO SJSC SA 16, % 36.7% % 11 JABAL OMAR DEVELOPMENT CO SJSC SA 15, % -13.7% % 12 EMAAR PROPERTIES PJSC AE 15, % 9.4% % 13 INDUSTRIES QATAR QSC QA 15, % -19.8% % 14 ALMARAI CO SJSC SA 14, %.4% % 15 NATIONAL BANK OF KUWAIT SAKP KW 14, % 17.4% % 16 SAMBA FINANCIAL GROUP SJSC SA 12, % -3.2% % 17 EMIRATES NBD BANK PJSC AE 12, % -4.% % 18 EMIRATES ISLAMIC BANK PJSC AE 1, %.% % 19 SAUDI BRITISH BANK SJSC SA 1, % 4.% % 2 KUWAIT FINANCE HOUSE KSCP KW 1, % 1.6% % 21 ABU DHABI COMMERCIAL BANK PJSC AE 1, % 5.2% % 22 RIYAD BANK SJSC SA 9, % 4.4% % 23 BANQUE SAUDI FRANSI SJSC SA 9, % 11.9% % 24 YANBU NATIONAL PETROCHEMICALS CO SA 8, % 4.4% % 25 KINGDOM HOLDING CO SA 8, % -31.% % 26 DUBAI ISLAMIC BANK PJSC AE 8, % 7.5% % 27 EMAAR MALLS PJSC AE 7, % -14.9% % 28 OOREDOO QSC QA 7, % -17.5% % 29 ALINMA BANK SJSC SA 7, % 17.1% % 3 MASRAF AL RAYAN QPSC QA 6, % -6.9% % 31 SAUDI ARABIA FERTILIZERS CO SJSC SA 6, % -2.1% % 32 ARAB NATIONAL BANK SA 6, %.% % 33 EMIRATES INTEGRATED TELECOM AE 6, % -15.3% % 34 MOBILE TELECOMMUNICATIONS KW 6, % 9.8% % 35 DAMAC PROPERTIES DUBAI CO PSC AE 5, % 41.9% % 6

7 Top 5 MENA Stocks by Market Capitalization Continued ( indicates native currency; Latest data) Company Name Country Market Cap (USD mln) MTD % YTD % 52w High 52w Low P/E P/B Dividend Yield 36 EZDAN HOLDING GROUP QSC QA 5, % -44.4% % 37 QATAR ISLAMIC BANK QPSC QA 5, % -9.5% % 38 SAVOLA GROUP COMPANY SJSC SA 5, % -1.7% % 39 QATAR ELECTRICITY AND WATER CO QSC QA 5, % -22.2% % 4 AHLI UNITED BANK BSC BA 5, % 16.9% % 41 COMMERCIAL INTERNATIONAL BANK EG 5, % 6.6% % 42 ALDAR PROPERTIES PJSC AE 4, % -14.8% % 43 MESAIEED PETROCHEMICAL HOLDING CO QA 3, % -29.4% % 44 SAUDI KAYAN PETROCHEMICAL CO SJSC SA 3, % 2.3% % 45 ALAWWAL BANK SA 3, % -15.4% % 46 JARIR MARKETING CO SJSC SA 3, % 22.7% % 47 MASHREQBANK PSC AE 3, % 12.8% % 48 ABU DHABI ISLAMIC BANK PJSC AE 3, % -1.8% % 49 COMPANY FOR COOPERATIVE INSURANCE SA 3, % 11.4% % 5 AGILITY PUBLIC WAREHOUSING CO KSCP KW 3, % 29.3% % Total MCap; Weighted Avg Div Yield 648,23 3.7% Disclaimer: This report is prepared by Al Masah Capital Management Limited ( AMCML ). AMCML is a company incorporated in the DIFC (Dubai International Financial Centre) and regulated by the DFSA (Dubai Financial Services Authority). The information contained in this report does not constitute any offer to sell securities or the solicitation of any offer to buy, or recommendation for investment in, any securities in any jurisdiction. The information in this report is not intended as financial advice and is only intended to be used by experienced investment persons with appropriate investment knowledge and ones that AMCML is satisfied meet the regulatory criteria to be classified as a Professional Client as defined under the Rules & Regulations of the appropriate financial authority. More-over, none of the report is intended as a prospectus within the meaning of the applicable laws of any jurisdiction and none of the report is directed to any person in any country in which the distribution of such report is unlawful. This report provides general information only. The information and opinions in the report constitute a judgment as at the date indicated and are subject to change without notice. The information may therefore not be accurate or current. The information and opinions contained in this report have been compiled or arrived at from sources believed to be reliable in good faith, but no representation or warranty, express, or implied, is made by AMCML, as to their accuracy, completeness or correctness and AMCML does also not warrant that the information is up to date. Any reference to third party research material or any other report contained in this report represents the respective research organization's estimates and views and does not represent the views of AMCML and its officers and employees do not accept any liability or responsibility whatsoever with respect to its accuracy or correctness and AMCML has included such reports or made reference to such reports in good faith. This report may also provide the addresses of, or contain hyperlinks to websites. Except to the extent to which the report refers, AMCML takes no responsibility whatsoever for the contents therein. Such addresses or hyperlinks are provided solely for your convenience and information and the content of the linked site does not in any way form part of this report. Accessing such website or following such link through this report shall be at your own risk. Moreover, you should be aware of the fact that investments in undertakings, securities or other financial instruments involve general and specific risks. Past results do not guarantee future performance. AMCML does not accept any liability for any loss arising from the use of material presented in this report. AMCML may seek to do business, or may already have had some business dealings, with companies covered in this report. As a result, investors should be aware that AMCML may be considered as having a conflict of interest that could affect the objectivity of research produced. Investors should consider any AMCML research as only a single factor in making any investment decision. This document has not been reviewed by, approved by or filed with the DFSA. This report or any portion hereof may not be reprinted, sold or redistributed without our prior written consent of the Company. Copyright 215 Al Masah Capital Management Limited 7