Weekly Market Review November 16, 2014 November 22, 2014 November 23, 2014
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 US Fed Oct 28-29 meeting minutes revealed that Fed officials agreed to keep the market-friendly language on short term interest rates but added that Fed moves would depend on the pace of job growth and inflation US core CPI rose 1.8% YoY in Oct, after rising 1.7% YoY in Sept. MoM, core CPI rose 0.2% in Oct from 0.1% in Sept Existing home sales rose 1.5% to an annual rate of 5.26mn units, highest since Sept 2013 Homebuilder sentiment rose as NAHB/Wells Fargo Housing Market index advanced to 58 from 54 in Oct Flash US manufacturing PMI from Markit fell to 54.7 in Nov from 55.9 in Oct Factory production increased 0.2% in October. September s figure was revised down to 0.2% from 0.5% Markit s composite Euro zone PMI came below forecasts at 51.4 in Nov. Composite new orders index fell to 49.9 Flash estimate showed Euro zone consumer confidence fell to -11.6 in Nov from -11.1 in Oct Markit s composite PMI for France stood at 48.4 in November, just up from October's eight-month low of 48.2 British inflation edged up in Oct to 1.3% YoY from 1.2% YoY rise in Sept. Core inflation held steady at 1.5% in Oct Japan s GDP shrank by an annualized 1.6% in 3Q2014, after plunging 7.3% in 2Q2014, post the sales tax hike Exports in Oct rose 9.6% YoY, faster than 6.9% YoY growth in Sept. Total imports rose 2.7% YoY in Oct HSBC/Markit flash China manufacturing PMI fell to a six-month low of 50 in November from 50.4 in October Home prices slumped 2.6% YoY in Oct, despite government support. FDI fell 1.2% in Jan-Oct 2014 Australia and China witnessed 14 commercial agreements worth around $18bn, post the signing of a FTA Paris-based OECD raised 2015-16 growth forecast for India from 5.7% to 6.6%. Growth for 2016-17 was forecasted at 6.8%. Inflation was expected to slow down from 6.9% in 2014-15 to 5.4% in 2015-16 Brazil s 2014 budget surplus goal cut from 2.15% to 0.19% of GDP. 2015 economy growth target cut from 3% to 2% Mexico cuts 2014 growth forecast from 2.7% to 2.1-2.6% after GDP growth slowed from 0.9% in 2Q2014 to 0.5% QoQ in 3Q2014 Last Close Change 5 Day % YTD % S&P 500 2,063.50 23.68 1.16 11.64 DJI 17,810.06 175.32 0.99 7.44 Nasdaq Comp 4,712.97 24.43 0.52 12.84 Euro Stoxx 600 345.24 9.61 2.86 5.17 FTSE 100 6,750.76 96.39 1.45 0.02 Dax 9,732.55 479.61 5.18 1.89 CAC 40 4,347.23 144.77 3.44 1.19 Nikkei 225 17,357.51-133.32-0.76 6.54 Hang Seng 23,437.12-650.26-2.70 0.56 Brazil - Bovespa 56,084.04 4,311.64 8.33 8.89 Russia - Micex 1,538.93 38.17 2.54 2.32 BSE Sensex 28,334.63 287.97 1.03 33.84 Shanghai Comp 2,486.79 7.97 0.32 17.52 S&P 500 1 year performance Euro Stoxx 600 1 year performance Page I 3
GCC EQUITIES Emirates NBD, First Gulf Bank, Mashreq bank and Union National Bank took part in the fund-raising of Singapore s Mercuria Energy Group s AED3.67bn credit facility SPF Realty partners with G&Co for Millennium Square residential community project worth AED2.8bn Dubai Festival City, owned by Al-Futtaim Group, is seeking a $1.1bn loan to repay debt and help fund expansion Arkan Building Materials opened AED1.3bn Al Ain cement factory, increasing capacity to 5.6mn from 4.5mn tons FlyDubai raised $500mn from the sale of its debut five-year Sukuk Aramex signed a JV deal with Thailand-based Leo Global Logistic to form Aramex Thailand Moody s affirmed DP World s Long-term Issuer rating at Baa3 with a Stable outlook Fitch Ratings affirmed creditworthiness of Ras Al Khaimah at A with a Stable outlook Drake & Scull International issued $120mn unrated senior unsecured 5-yr certificates by way of private placement Dubai World closes in on a deal to extend repayment of $10.5bn of borrowings until 2022 Saudi Arabia-based Fawaz Alhokair Group plans to raise $2bn from the IPO of its Arabian Centres malls unit Saudi Kayan Petrochemical Co. signed two Islamic financing deals totaling SR2.63bn with NCB and Samba group Saudi Hotels and Resorts changed its name to DUR Hospitality Company, plans to invest SR1.5bn for expansion Saudi Arabia is considering to allow FIIs to begin direct trading of Saudi Arabian stocks before April 2015 Fitch ratings affirmed Long-term Issuer Default Ratings of 9 Kuwaiti banks with a Stable outlook Moody s affirmed Kuwait Finance House Bank Financial Strength Rating with a Negative outlook Qatar-based Barwa bank reported a 56% increase in 3Q2014 net profit to QR220mn Bahrain-based Gulf Finance House reduced its capital from $972.3mn to $837.9mn to cut its accumulated losses AM Best affirmed Bahrain Kuwait Insurance Co s Financial Strength and Issuer Credit rating with Stable outlook Bahrain s Arcapita Bank raised $100mn from shareholders to fund a return to deal-making activities Last Close Change 5 Day % YTD % Dubai 4,563.39-93.90-2.02 35.42 Abu Dhabi 4,957.79 4.43 0.09 15.56 Saudi Tadawul 9,408.83-272.83-2.82 10.23 Qatar Index 13,846.01 116.23 0.85 33.40 Kuwait Index 6,985.89-215.37-2.99-7.47 Oman MSM 30 7,078.72 65.27 0.93 3.57 Bahrain All Share 1,441.24 10.93 0.76 15.40 Egypt EGX 30 9,258.18-2.00-0.02 36.49 Istanbul 100 Index 83,281.80 2,070.25 2.55 22.83 DFMGI 1 year performance Saudi Tadawul 1 year performance Page I 4
CURRENCIES The yen lost 0.22% in the week against the euro, registering a 6 th week of fall. It closed at 145.99 per euro, as the Bank of Japan warned inflation may slip below 1% before a consumer prices report due on Nov 27 The dollar appreciated 1.07% in the week to 1.2391 per Euro after European Central Bank chief Mario Draghi said inflation expectations were declining to levels that were very low, keeping the door open for further monetary easing soon The Canadian dollar climbed 0.5% in the week to 1.1233 per US dollar after inflation rose faster than all economists forecasts in October, boosting speculation the Bank of Canada will signal it s closer to raising interest rates Brazil s real gained 3.3% in the week to 2.5158 per dollar, on speculation that President Dilma Rousseff is close to nominating a team capable of reviving Latin America s largest economy The Russian ruble rallied 3.12% in the week to close at 45.8345 per dollar as oil futures gained for the first time in nine weeks Indonesia s rupiah completed its first weekly gain in a month and appreciated 0.55% to 12,147 per dollar after President Joko Widodo cut fuel subsidies and the central bank raised interest rates to soften the inflationary impact Last Close Change 5 Day % YTD % EUR/USD 1.2391-0.0134-1.07-9.84 GBP/USD 1.5656-0.0013-0.08-5.44 AUD/USD 0.8670-0.0080-0.91-2.77 USD/JPY 117.7900 1.5000 1.29 11.85 USD/CHF 0.9697 0.0106 1.11 8.60 USD/CAD 1.1233-0.0054-0.48 5.74 USD/BRl 2.5158-0.0858-3.30 6.51 USD/RUB 45.8345-1.4765-3.12 39.44 USD/INR 61.7750 0.0537 0.09-0.04 USD/CNY 6.1248-0.0052-0.08 1.16 DXY Index 88.3100 0.7850 0.90 10.34 EUR/USD 1 year performance GBP/USD 1 year performance Page I 5
COMMODITIES WTI rose 0.9% and Brent gained 1.2% in the week after the People s Bank of China lowered lending and deposit rates for the first time since 2012, leading to the perception that fuel demand will gain Gold and silver appreciated 1.1% and 0.8% in the week after a surprise rate cut by China boosted demand for precious metals as a store of value. Meanwhile, IMF data showed that Russia added to its gold reserves in Oct, bringing holdings to the highest in at least two decades Soybean futures were up 1.76% in the week on speculation that increased stimulus from Japan, Euro zone and China will spur economic growth and food demand Nickel futures advanced 6.7% in the week after Indonesia, the largest producer of mined nickel ore, reaffirmed its ore export ban and data showed that global surplus has narrowed from last year Last Close Change 5 Day % YTD % Gold spot 1,201.55 12.80 1.08-0.34 Silver spot 16.44 0.13 0.80-15.56 Copper-CMX 302.90-0.95-0.31-9.61 Brent - ICE 80.36 0.95 1.20-24.11 WTI - Nymex 76.51 0.69 0.91-16.78 S&P GSCI Spot Index 525.20 4.23 0.81-16.94 Baltic Dry Index 1,324.00 68.00 5.41-41.85 Orange-juice futures surged 10.1% in the past week as bone-chilling weather swept through parts of the US, sparking worries that freezing temperatures could damage Florida s orange crop this winter WTI Crude 1 year performance GOLD 1 year performance Page I 6
INTEREST RATES US 10-year treasuries rose and yield declined 1.0 bps in the week to 2.31% as inflation below the Federal Reserve s goal boosted speculation that policy makers won t be in a hurry to raise interest rates in 2015 UK 10-year bonds advanced and yield fell 6.8 bps in the week to 2.05% as a report showed inflation stayed near the lowest level in five years, adding to speculation that monetary policy makers have no case to raise interest rates soon Italy s 10-year yield fell 13 bps in the week to 2.21% amid speculation the European Central Bank will broaden its asset purchases to buy sovereign debt Spain s 10-year yield declined 11 bps in the week to 2.01%, the lowest on record, as data showed a slowdown in manufacturing and services output in the Euro zone Austrian and French 10-year rates dropped to record lows, as ECB President Mario Draghi said that policy makers would be willing to widen the scope of the central bank s purchases should the inflation outlook for the region diminish. Austrian 10-yr yield fell 2 bps to 0.94% while French 10-yr yield was down 2.8 bps to 1.1% in the week Last Close Change 5 Day % YTD % USD-1w Libor 0.13 0.0055 4.57-2.75 USD-3m Libor 0.23 0.0008 0.32-5.38 USD-6m Libor 0.33 0.0005 0.15-6.06 USD-10yr 2.31-0.0105-0.45-23.72 AED-1m EIBOR 0.38 0.0014 0.38-17.08 AED-3m EIBOR 0.68 0.0000 0.00-15.82 AED-12m EIBOR 1.02 0.0000 0.00-14.23 UK-10yr 2.05-0.0680-3.21-32.23 Japan-10yr 0.46-0.0220-4.60-37.96 The People's Bank of China cut its one-year benchmark lending rates by 40 bps to 5.6% and lowered one-year benchmark deposit rates by 25 bps to 2.75%, effective Nov 22, to support growth and ease debt pressure India s benchmark 10-year bond yield fell 5 bps in the week to 8.17%, largely on optimism that easing consumer inflation would spur easier monetary policy 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 Greece 11.71% 10.52% 2 Brazil 8.33% 12.02% 3 Russia 5.84% 5.84% 4 Italy 5.22% 4.09% 5 Germany 5.18% 4.06% 6 Ireland 4.76% 3.64% 7 Austria 4.02% 2.90% 8 Luxembourg 3.93% 2.82% 9 Finland 3.74% 2.63% 10 Spain 3.67% 2.56% Ref Country YTD Change YTD Change (USD Adj.) 1 Argentina 85.06% 41.68% 2 Egypt 36.49% 32.59% 3 Dubai UAE 35.42% 35.41% 4 India 33.84% 33.89% 5 Qatar 33.40% 33.38% 6 Sri Lanka 25.18% 24.91% 7 Pakistan 24.68% 29.21% 8 Slovenia 24.53% 12.28% 9 Philippine 23.54% 21.85% 10 Serbia 23.53% 6.22% Ref Country Weekly Change Weekly Change (USD Adj.) 1 Nigeria -4.11% -7.12% 2 Kuwait -2.99% -2.96% 3 Saudi Arabia -2.82% -2.81% 4 Mongolia -2.77% -3.22% 5 Hong Kong -2.70% -2.75% 6 Morocco -2.50% -3.54% 7 Vietnam -2.05% -2.28% 8 Dubai UAE -2.02% -2.02% 9 Bulgaria -1.84% -2.89% 10 Kazakhstan -1.57% -1.59% Ref Country YTD Change YTD Change (USD Adj.) 1 Russia -26.61% -26.61% 2 Portugal -18.84% -26.83% 3 Nigeria -17.91% -25.74% 4 Greece -14.42% -22.84% 5 Cyprus -11.17% -19.91% 6 Malta -10.83% -19.60% 7 Austria -10.56% -19.36% 8 Mongolia -9.00% -19.66% 9 Latvia -7.95% -17.01% 10 Kuwait -7.47% -10.39% Page I 8
COMMODITY MARKETS - TOP MOST & BOTTOM MOST WEEKLY YTD Ref Commodity Weekly Change 1 Orange Juice 10.11% 2 Rough Rice 7.37% 3 Nickel 6.71% 4 Natural Gas 6.12% 5 Lumber 4.91% 6 Tin 4.18% 7 Palladium 3.31% 8 Ethanol 1.98% 9 Soybeans 1.76% 10 Zinc 1.73% Ref Commodity YTD Pct Change 1 Coffee 71.32% 2 Feeder Cattle 41.78% 3 Live Cattle 27.06% 4 Nickel 19.60% 5 Aluminium 14.12% 6 Zinc 12.12% 7 Palladium 10.66% 8 Ethanol 7.80% 9 Lean Hogs 6.12% 10 Cocoa 5.83% Ref Commodity Weekly Change 1 Corn -2.36% 2 Wheat -2.36% 3 Lean Hogs -2.19% 4 Steel Rebar -2.00% 5 Feeder Cattle -1.52% 6 Coffee -1.22% 7 Copper -0.49% 8 Heat Oil -0.48% 9 Bean Meal -0.39% 10 Cotton -0.07% Ref Commodity YTD Pct Change 1 Rubber -31.92% 2 Cotton -29.40% 3 Brent Crude -27.47% 4 Gasoline -26.18% 5 Gasoil -25.42% 6 Steel Rebar -22.34% 7 WTI Crude -22.26% 8 Heat Oil -21.86% 9 Soybeans -20.84% 10 Rough Rice -18.79% Page I 9
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