Weekly Market Review December 07, 2014 December 13, 2014

Transcription

1 Weekly Market Review December 07, 2014 December 13, 2014 December 14, 2014

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 Thomson Reuters/University of Michigan preliminary US consumer sentiment index stood at 93.8 in Dec vs in Nov and highest since Jan 2007 Core retail sales increased 4.4% YoY in Nov, recording largest YoY increase since early 2012 Mortgage applications to buy new homes fell 22% MoM in Nov due to tight credit conditions Euro area industrial output grew 0.1% MoM in Oct, less than the forecast of 0.2% gain. Output was up 0.7% YoY Sentix Euro zone investors sentiment index climbed to -2.5 in Dec from in Nov, and higher than Reuters poll German industrial production gained 0.2% MoM and 0.4% YoY in a sign that a slow economic recovery is continuing Trade surplus stood at 20.6bn in Oct, up from 18.6bn in Sept as imports fell 3.1% Fitch cut France s credit rating from AA+ to AA, in the absence of improvement in nation s public debt dynamics Italy s industrial output slipped 0.1% MoM in Oct, offering no sign of recovery for the recession-bound economy UK trade deficit narrowed to 9.62bn in Oct from 10.51bn in Sept, on lower fuel imports and slight rise in exports Greek unemployment fell to 25.7% in Sept from 26% in Aug, as the country's six-year recession eases Japan s economy shrank 1.9% YoY in 3Q2014 vs. an initial estimate of 1.6% fall, on decline in business investment China s exports rose 4.7% while imports fell 6.7% YoY in Nov, leaving a record high trade surplus of $54.47bn China factory output rose 7.2% YoY in Nov vs. 7.7% gain in Oct. Investment grew 15.8% YoY YTD till Nov, ~13-yr low India s current account deficit rose to $10.1bn from $7.8bn in 2Q2014 on higher gold imports and lower exports Industrial production contracted 4.2% YoY in Oct while Nov retail inflation came at 4.38% World Bank expects Russian economy to contract by 0.7% in 2015 before growing by 0.3% in 2016 World Bank cut Indonesia s growth target in 2015 to 5.2% from 5.6% on weak fixed investment and trade outlook South Korea s top government think tank, Korea Development Institute cut & growth forecast from 3.7% & 3.8% to 3.4% & 3.5%, respectively Last Close Change 5 Day % YTD % S&P 500 2, DJI 17, Nasdaq Comp 4, Euro Stoxx FTSE 100 6, Dax 9, CAC 40 4, Nikkei , Hang Seng 23, Brazil - Bovespa 48, , Russia - Micex 1, BSE Sensex 27, , Shanghai Comp 2, S&P year performance Euro Stoxx year performance Page I 3

4 GCC EQUITIES Al Habtoor Group launched two hospitality and a residential project worth AED2bn in Dubai Waha capital eyes potential investments of up to AED4bn in infrastructure, energy, education & healthcare sectors Abu Dhabi Financial Group acquired London s New Scotland Yard for 370mn Select Group awarded AED1bn contract to UAE-based ALEC for first two phases of Marina Gate development Green Valley Real Estate announced AED1bn Al Dana Island project in the UAE, spread over 1.7mn square feet Mubadala owned Al Yah Satellite Communications plans to raise $500mn to finance its third satellite project Abu Dhabi Oil Refining Co. said that $10bn Ruwais refinery extension will be fully operational by 2015-beginning Abu Dhabi National Co. for Onshore Oil Operations awarded $2.25bn oil & gas project to Italy s Maire Tecnimont Omniyat begun construction on an AED600mn 48-storey tower in Dubai Maritime City Bank of Sharjah plans to refinance $200mn loan maturing in 2015, hoping to benefit from lower borrowing costs Emaar The Economic City signed SR1.25bn Murabaha agreement with Alinma Bank to develop Haramain district Saudi-based National Industrialization Co. completed SR1.8bn deal to raise its majority stake in Cristal subsidiary Islamic Development Bank confirmed to provide $1bn financing for various developmental projects in Cote d Ivoire National Shipping Co. of Saudi Arabia recommended cash dividends of SR1 per share (total SR393.75mn) for 2014 Moody s upgraded Al Madina Insurance Company s Insurance Financial Strength Rating from Ba2 to Ba1 Kuwait Oil Company will spend $4.2bn on phase I of Lower Fars heavy-oil project and pump 60,000 bpd by 2018 Barwa Bank appointed to arrange QR3.64bn financing for a JV constructing Gold Line Underground of Doha metro Al Khaliji Commercial Bank will extend financing to a JV working on transmission pipelines for QR900mn Doha reservoirs project Oman-based Sun Metals awarded $400mn steel making plant construction contract to South Korea s Posco E&C Gulf Finance House inks JV deal with France's Alliance International Holding to kick-start $3bn Tunis Bay project Last Close Change 5 Day % YTD % Dubai 3, Abu Dhabi 4, Saudi Tadawul 8, Qatar Index 11, Kuwait Index 6, Oman MSM 30 5, Bahrain All Share 1, Egypt EGX 30 9, Istanbul 100 Index 83, , DFMGI 1 year performance Saudi Tadawul 1 year performance Page I 4

5 CURRENCIES US dollar weakened 2.2% in the week to yen per dollar as tumbling oil prices dragged down inflation expectations and the global economic outlook, fueling speculation the Federal Reserve may rethink the timing of an interest-rate increase next year Swiss franc appreciated 0.1% in the week to per euro as Switzerland s central-bank officials vowed to defend the 1.20 franc-per-euro cap, saying the risk of deflation has increased Chinese Yuan fell 0.6% in the week to 6.19 per dollar on growing speculations that China may take more stimulus to support the world's second-largest economy Brazil s real extended its 3 rd straight weekly decline and fell 2.5% as bets that the Federal Reserve will start raising interest rates sooner than expected and a decline in commodities made emerging-market assets less attractive Russian ruble plunged 10.2% in the week to per dollar as weaker oil prices worsen the outlook for the economy which is on the verge of recession Norwegian krone depreciated 2.7% in the week to 7.35 per dollar as the Norges Bank lowered interest rates for the first time in more than two years on December 11. Governor Oeystein Olsen said that there was still a 50% chance that the central bank will cut rates again next year to prevent a severe downturn 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 South Korean won appreciated 1.0% in the week against US dollar as the yen's rebound eased concerns that the country may lose export competitiveness against Japan EUR/USD 1 year performance GBP/USD 1 year performance Page I 5

6 COMMODITIES The West Texas Intermediate (WTI) crude registered a weekly decline of 12% while Brent lost 10.5% in the week as IEA reduced its estimate for global oil demand growth in 2015 by 230,000 barrels a day Gold rose 2.5% in the week as falling stock markets prompted some investors to buy the metal as an alternative asset, while a drop in the greenback made dollar-priced bullion cheaper for holders of other currencies Corn futures on Chicago Board of Trade (CBOT) gained 6.8% in the week, fueled by technical buying as well as heavy buying by commodity funds CBOT wheat futures slid 0.4% in the week as Russian exporters cut wheat prices in a bid to speed up sales abroad before the government possibly introduces curbs to replenish its own stocks and prevent rises in the cost of bread Coffee futures on ICE lost 3.4% in the week as an increase in rainfall in Brazil is helping to ease concerns over the size of next season s crop from the world s top producer. A drought earlier this year shrank the country s output and sent prices soaring 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 Palladium gained 1.65% in the week as low oil prices and improving auto sales boosted metal s value. Automotive industry consumes around 67% of the metal s supply WTI Crude 1 year performance GOLD 1 year performance Page I 6

7 INTEREST RATES US treasuries rallied and 10-yr yield fell 22.5 bps in the week to 2.08% as a plunge in crude oil prices prompted speculation that Federal Reserve interest-rate increases may be delayed by slowing global inflation Greek 10-yr bond yield surged 192 bps in the week to 9.15% while yield on 3-yr note, issued in July jumped more than 450 bps climbing above the longer-dated rates in a sign that investors are increasingly concerned the nation will be unable to pay its debt China s fixed-floating interest-rate swap rose 8 bps in the week to 3.34% as improving lending data and the central bank s use of targeted fund injections damped speculation there will be more broad-based loosening policies Russia's central bank raised its main lending rate by 100 bps to 10.5% to prop up the ruble and said that it would continue raising its key rate if inflation risks deepen The Bank of Korea's monetary policy committee held its base rate steady at 2% as the central bank governor flagged downward revisions to forecasts for inflation and economic growth, raising expectations of a cut in 2015 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 Chile and Peru kept their benchmark interest rates unchanged at 3% and 3.5%, respectively, as policy makers in the Andean neighbors struggle to slow above-target inflation without hampering economic recovery 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 Venezuela 26.05% 26.05% 2 Cyprus 13.08% 14.73% 3 Bulgaria 1.60% 3.04% 4 Lebanon 0.43% 0.43% 5 New Zealand 0.39% 1.25% 6 Ghana 0.29% 0.23% 7 Israel 0.17% 2.10% 8 Latvia 0.06% 1.52% 9 China 0.02% -0.57% 10 Ref Country YTD Change YTD Change (USD Adj.) 1 Argentina 53.35% 16.90% 2 Venezuela 41.16% 41.16% 3 China 38.86% 35.85% 4 Egypt 35.59% 31.73% 5 India 29.19% 28.16% 6 Pakistan 25.05% 31.04% 7 Turkey 22.75% 14.72% 8 Philippine 22.66% 22.16% 9 Sri Lanka 22.39% 22.03% 10 Serbia 22.09% 3.90% Ref Country Weekly Change Weekly Change (USD Adj.) 1 Greece % % 2 Dubai UAE % % 3 Argentina % % 4 Russia % % 5 Oman % % 6 Portugal -8.28% -6.95% 7 Colombia -7.85% % 8 Brazil -7.68% -9.96% 9 Nigeria -7.42% -6.52% 10 Italy -7.40% -6.05% Ref Country YTD Change YTD Change (USD Adj.) 1 Russia % % 2 Greece % % 3 Portugal % % 4 Nigeria % % 5 Austria % % 6 Oman % % 7 Kuwait % % 8 Colombia % % 9 Malta % % 10 Latvia -8.70% % Page I 8

9 COMMODITY MARKETS - TOP MOST & BOTTOM MOST WEEKLY YTD Ref Commodity Weekly Change 1 Corn 6.82% 2 Silver 4.59% 3 Orange Juice 3.39% 4 Gold 2.54% 5 Rough Rice 2.36% 6 Palladium 1.65% 7 Soybeans 1.09% 8 Soybean Oil 1.09% 9 Tin 0.99% 10 Platinum 0.98% Ref Commodity YTD Pct Change 1 Coffee 56.28% 2 Feeder Cattle 35.33% 3 Live Cattle 20.48% 4 Nickel 19.96% 5 Palladium 13.78% 6 Orange Juice 10.63% 7 Zinc 8.91% 8 Aluminium 7.49% 9 Cocoa 6.72% 10 Gold 1.74% Ref Commodity Weekly Change 1 WTI Crude % 2 Brent Crude % 3 Gasoline -9.93% 4 Gasoil -8.49% 5 Bean Meal -6.90% 6 Heat Oil -4.36% 7 Feeder Cattle -3.95% 8 Lean Hogs -3.87% 9 Coffee -3.41% 10 Aluminium -2.37% Ref Commodity YTD Pct Change 1 Brent Crude % 2 Gasoline % 3 WTI Crude % 4 Gasoil % 5 Rubber % 6 Heat Oil % 7 Cotton % 8 Steel Rebar % 9 Natural Gas/ICE % 10 Rough Rice % 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