Weekly Market Review January 18, 2015 January 24, 2015 January 25, 2015
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
INTERNATIONAL EQUITY MARKETS Conference Board s Leading Economic index for US increased 0.5% in Dec after a revised 0.4% gain in Nov US companies borrowing for capital investment rose 20% YoY in Dec Initial jobless claims fell 10,000 to 307,000 for the week ended Jan 17, pointing to improving labor market Markit s US flash Manufacturing PMI fell to 53.7 in Jan from 53.9 in Dec Existing home sales rose 2.4% to an annual rate of 5.04mn units in Dec. First-time buyers participation remained low at 29% for Dec and 2014 as a whole IMF lowered global growth forecast by 0.3% each to 3.5% and 3.7% in 2015 and 2016, respectively Euro area manufacturing and services expanded as Markit s composite PMI rose to 52.2 in Jan from 51.4 in Dec ECB agreed to pump 60bn a month into Euro zone economy from Mar 2015 till Sep 2016 to buoy flagging economy An ECB survey showed that one in four Euro zone banks witnessed a rise in home loan demand towards 2014-end UK unemployment rate declined more than forecast to 6-year low of 5.8% in the quarter ending Nov 2014 China s economy grew by 7.4% in 2014, slowest since 1990, amid cooling property prices and heavy debt burden People's Bank of China issued an additional Yuan 50bn worth of 3-month loans to banks to spur growth Preliminary HSBC/Markit manufacturing PMI slightly recovered to 49.8 in Jan from 49.6 in Dec Bank of Japan lowered core inflation projection to 1% from 1.7% and raised economy growth estimate to 2.1% for FY2015-16. Also, it left its monetary expansion unchanged at an annual pace of yen 80tn Markit/JMMA flash Japan Manufacturing PMI rose to seasonally adjusted 52.1 in Jan from 52.0 in Dec Brazil increased tax on fuel, imports and consumer loans aimed at raising $7.7bn additional revenues in 2015 Consumer prices rose 6.69% YoY in mid-jan as authorities raise electricity tariffs and bus fares India s foreign exchange reserves rose $2.7bn to reach a record high of $322.1bn in the week ended Jan 16 OPEC-member Venezuela's economy shrunk 2.8% in 2014 while recording inflation above 64% Last Close Change 5 Day % YTD % S&P 500 2,051.82 32.40 1.60-0.34 DJI 17,672.60 161.03 0.92-0.84 Nasdaq Comp 4,757.88 123.50 2.66 0.46 Euro Stoxx 600 370.37 17.97 5.10 8.12 FTSE 100 6,832.83 282.56 4.31 4.06 Dax 10,649.58 481.81 4.74 8.61 CAC 40 4,640.69 261.07 5.96 8.61 Nikkei 225 17,511.75 647.59 3.84 0.35 Hang Seng 24,850.45 746.93 3.10 5.28 Brazil - Bovespa 48,775.30-241.22-0.49-2.46 Russia - Micex 1,671.80 80.37 5.05 19.70 BSE Sensex 29,278.84 1,156.95 4.11 6.47 Shanghai Comp 3,351.76-24.73-0.73 3.62 S&P 500 1 year performance Euro Stoxx 600 1 year performance Page I 3
GCC EQUITIES Capital Intelligence affirmed the UAE s long & short-term foreign & local currency sovereign ratings at AA- and A1+, respectively with a Stable outlook TECOM Investments signed for up to AED4bn syndicated loan facility to fund its growth Nakheel reported 43.2% jump in net profit to AED3.68bn in 2014, expects a 40% profit growth in 2015 and 2016. Targets to award AED7bn worth construction contracts in 2015 vs. AED5.3bn tendered in 2014 Emaar Malls Group s 4Q2014 net profit increased 5% YoY to AED412mn. Revenue rose 7.5% YoY to AED800mn Dubai's Arabtec Holding won an AED345mn contract from Abu Dhabi National Oil Co. to expand a housing complex Emirates National Oil Co. seeks to arrange $1.5bn long-term loan to take advantage of low lending rates Etihad Etisalat (Mobily) reported an unexpected loss of SR2.28bn in 4Q2014 vs. net profit of SR1.69bn in 4Q2013 Saudi Telecom s 4Q2014 net profit declined 32.6% YoY to SR2.44bn and operating profit fell 16% YoY to SR2.38bn National Industrialisation Co. signed SR1.2bn Islamic loan to part-fund further stake buying in subsidiary Cristal Saudi Arabia s Al Waha Petrochem. secured SR1.96bn from two local lenders to refinance an existing Islamic loan Al Hammadi Co. for Development recommended SR450mn capital increase and SR75mn dividend for 2014 Zain Saudi s 4Q2014 net loss narrowed to SR306mn from a net loss of SR462mn recorded in 4Q2013 Saudi Airlines Catering Co. recorded around 36% YoY increase in 4Q2014 net profit to SR172.8mn Salman bin Abdulaziz Al Saud became new King of Saudi Arabia upon the death of King Abdullah bin Abdulaziz Moody s affirmed Ooredoo s long-term issuer rating at A2. Revised its outlook from Stable to Negative Doha Bank seeks shareholder s approval to issue international bonds totaling up to $2bn National Bank of Kuwait reported 46.4% YoY rise in 4Q2014 net profit to KD57.9mn Oman s Bank Dhofar plans to raise its capital by up to $300mn, preferably by issuing Tier-I capital boosting bond National Bank of Bahrain reported 4% rise in 2014 profit to BHD53.4mn; recommends BHD23.5mn cash dividend Last Close Change 5 Day % YTD % Dubai 3,882.93 40.33 1.05 2.89 Abu Dhabi 4,526.92 45.56 1.02-0.04 Saudi Tadawul 8,421.72-37.00-0.44 1.06 Qatar Index 11,698.86-163.65-1.38-4.78 Kuwait Index 6,662.81 64.14 0.97 1.94 Oman MSM 30 6,644.51 125.69 1.93 4.75 Bahrain All Share 1,428.65 0.19 0.01 0.15 Egypt EGX 30 9,898.86 342.87 3.59 10.89 Istanbul 100 Index 90,736.05 3,319.65 3.80 5.85 DFMGI 1 year performance Saudi Tadawul 1 year performance Page I 4
CURRENCIES Euro dropped 3.1% to 1.1204 US dollars, the biggest weekly drop since September 2011 as European Central Bank (ECB) President Mario Draghi outlined details of a 1.1tn stimulus plan that exceeded forecasts UK pound appreciated 2.2% in the week to 1.3379 per euro after the European Central Bank announced a plan to buy its region s sovereign bonds, damping demand for the shared currency Canada s dollar tumbled 3.6%, falling for a ninth week to 1.242 per dollar after the Bank of Canada unexpectedly cut interest rates, saying crude oil collapse will slow inflation and weigh on the economy Russia s ruble gained 2.45% in the week to 63.71 per dollar as investors channeled money back into higher-yielding assets Denmark s krone depreciated 3.4% in the week to 6.6454 per dollar after it lowered its benchmark deposit rate to a record low of minus 0.35% on Jan 22, its second rate cut in less than a week The Philippine peso, Indonesia s rupiah and India s rupee rallied the most in the week in Asia on signs the ECB s stimulus program will boost fund flows to higher-yielding emerging-market assets. Peso strengthened 1.1% to 44.18 per dollar, rupiah appreciated 1.0% to 12,459 per dollar while rupee advanced 0.7% to 61.44 per dollar Last Close Change 5 Day % YTD % EUR/USD 1.1204-0.0363-3.14-7.39 GBP/USD 1.4989-0.0161-1.06-3.77 AUD/USD 0.7912-0.0311-3.78-3.22 USD/JPY 117.7700 0.2600 0.22-1.68 USD/CHF 0.8801 0.0214 2.49-11.49 USD/CAD 1.2420 0.0436 3.64 6.88 USD/BRl 2.5802-0.0421-1.61-2.91 USD/RUB 63.7056-1.6004-2.45 4.89 USD/INR 61.4350-0.4363-0.71-2.55 USD/CNY 6.2287 0.0209 0.34 0.37 DXY Index 94.7620 2.2420 2.42 4.98 EUR/USD 1 year performance GBP/USD 1 year performance Page I 5
COMMODITIES Oil fell to the lowest in almost six years on speculation that the death of King Abdullah of Saudi Arabia won t signal any change in strategy for the world s largest crude exporter. West Texas Intermediate futures lost 7.2% to settle at $45.59/barrel, the lowest settlement since March 11, 2009 Gold and silver futures gained 1.1% and 2.8%, respectively, in the week as the metals attracted investors worried about slowing global growth and surprises by central banks Copper futures lost 4.4% in the week, the third straight weekly decline after a report showed manufacturing contracted for a second straight month in China, the world s top industrial-metals consumer Nickel futures closed 2.9% down in the week as imports of nickel ore by China, the world s largest consumer of industrial metals, slumped to the lowest in four years due to tightened global supply resulting from Indonesian ban on unprocessed minerals Last Close Change 5 Day % YTD % Gold spot 1,294.10 13.65 1.07 9.22 Silver spot 18.31 0.50 2.82 16.59 Copper-CMX 250.15-11.55-4.41-11.47 Brent - ICE 48.79-1.38-2.75-16.18 WTI - Nymex 45.59-3.54-7.21-15.10 S&P GSCI Spot Index 379.74-11.70-2.99-9.18 Baltic Dry Index 720.00-21.00-2.83-7.93 Cocoa futures slumped around 7.5% in the week after a report showed Asia processed fewer beans than expected during the last three months of 2014, underscoring weak demand world-wide Cotton futures slid 3.7% in the week despite another strong week for US export sales of the fibre, as technical factors, and panic selling by producers outweighed the signs of demands from importers WTI Crude 1 year performance GOLD 1 year performance Page I 6
INTEREST RATES US yields approached all-time lows as the Federal Reserve is forecasted to hold interest rates at virtually zero next week. 10-year note yields fell for a fourth week to 1.8% The ECB s unprecedented bond-buying plan crushed euro-area bond yields as investors jostled to get hold of government debt before the purchases begin in March. Italy s 10-year yield fell 13 bps to 1.52%, Spain s 10-year yield declined 12.8 bps to 1.37% while Germany s 10-year yield ended 9 bps down to 0.36% China s 10-year bond yield fell 5 bps in the week to 3.45% as the People s Bank of China conducted reverserepurchase agreements for the first time in a year, injecting Yuan 50bn to meet seasonal pick-up in cash demand Brazil s Central Bank boosted its benchmark Selic rate by 50 bps to 12.25%, the third consecutive rate hike since Rousseff won re-election in October, as it sought to bring down inflation currently running at about 6.5% annually Bank of Canada unexpectedly lowered its overnight rate from 1% to 0.75%, in order to counteract the negative economic impact of lower oil prices on Canada, the world s fifth largest crude producer Last Close Change 5 Day % YTD % USD-1w Libor 0.13-0.0003-0.22-0.22 USD-3m Libor 0.26-0.0005-0.19 0.20 USD-6m Libor 0.36 0.0025 0.70-1.49 USD-10yr 1.80-0.0400-2.18-17.24 AED-1m EIBOR 0.38-0.0043-1.11-3.26 AED-3m EIBOR 0.68 0.0000 0.00 0.00 AED-12m EIBOR 1.02 0.0000 0.00 0.00 UK-10yr 1.48-0.0560-3.65-15.83 Japan-10yr 0.23-0.0090-3.80-29.19 Danish central bank lowered its deposit rate to minus 0.35% from minus 0.2% on Jan 22 after cutting from minus 0.05% on Jan 19 as it sought to dampen interest in its currency among investors selling the euro after the European Central Bank announced a stimulus package US 10 year Generic Yield 1 year performance UK 10 year Generic Yield 1 year performance Page I 7
EQUITY MARKETS - TOP MOST & BOTTOM MOST WEEKLY YTD Ref Country Weekly Change Weekly Change (USD Adj.) 1 Finland 7.89% 4.50% 2 Russia 6.65% 6.65% 3 Italy 6.57% 3.23% 4 Hungary 6.37% 5.89% 5 Greece 6.31% 2.97% 6 France 5.96% 2.64% 7 Portugal 5.62% 2.30% 8 Ireland 5.56% 2.25% 9 Spain 5.40% 2.10% 10 Thailand 5.31% 5.24% Ref Country YTD Change YTD Change (USD Adj.) 1 Egypt 10.89% 7.32% 2 Portugal 10.45% 2.29% 3 Sweden 10.20% 2.06% 4 Estonia 8.66% 0.63% 5 France 8.61% 0.59% 6 Germany 8.61% 0.58% 7 Italy 7.93% -0.04% 8 Denmark 7.80% -0.15% 9 Netherlands 7.09% -0.82% 10 Ireland 6.76% -1.13% Ref Country Weekly Change Weekly Change (USD Adj.) 1 Cyprus -4.14% -7.15% 2 Sri Lanka -3.16% -3.50% 3 Ukraine -2.95% -2.75% 4 Ghana -2.25% -5.60% 5 Morocco -1.51% -4.04% 6 Qatar -1.38% -1.41% 7 Mongolia -1.28% -1.97% 8 Bulgaria -1.03% -4.05% 9 Mauritius -0.94% -2.23% 10 China -0.73% -1.07% Ref Country YTD Change YTD Change (USD Adj.) 1 Nigeria -13.98% -17.27% 2 Switzerland -9.15% 2.64% 3 Peru -8.86% -10.03% 4 Cyprus -7.16% -14.02% 5 Kazakhstan -6.19% -7.11% 6 Colombia -5.93% -6.44% 7 Qatar -4.78% -4.77% 8 Bulgaria -4.74% -11.73% 9 Ghana -3.44% -7.26% 10 Mongolia -2.92% -5.59% Page I 8
COMMODITY MARKETS - TOP MOST & BOTTOM MOST WEEKLY YTD Ref Commodity Weekly Change 1 Ethanol 9.33% 2 Rubber 4.12% 3 Gasoline 3.73% 4 Silver 2.82% 5 Palladium 2.36% 6 Corn 1.78% 7 Zinc 1.47% 8 Bean Meal 1.47% 9 Heat Oil 1.44% 10 Gold 1.07% Ref Commodity YTD Pct Change 1 Silver 16.59% 2 Gold 9.22% 3 Orange Juice 5.14% 4 Platinum 5.03% 5 Sugar 4.48% 6 Natural Gas 3.36% 7 Tin 0.39% 8 9 10 Ref Commodity Weekly Change 1 Lean Hogs -8.36% 2 Coffee -8.04% 3 Cocoa -7.46% 4 Natural Gas -5.45% 5 Copper -4.41% 6 Soybean Oil -4.21% 7 Cotton -3.68% 8 Palm Oil -3.58% 9 Nickel -2.91% 10 Rough Rice -2.82% Ref Commodity YTD Pct Change 1 Brent Crude -14.90% 2 Lean Hogs -14.66% 3 WTI Crude -14.42% 4 Steel Rebar -12.31% 5 Ethanol -12.11% 6 Copper -11.47% 7 Heat Oil -10.83% 8 Natural Gas -10.60% 9 Wheat -10.13% 10 Live Cattle -9.26% Page I 9
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