weekly market review - mashreq€¦ · consumer price index for us slipped 0.2% in feb on the back...

Weekly Market Review March 13, 2016 – March 19, 2016

March 20, 2016

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CONTENTS

International Equity Markets

GCC Equities

Currencies

Commodities

Interest Rates

Equity Markets - Top Most & Bottom Most

Commodity Markets - Top Most & Bottom Most

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Americas

US retail sales edged down 0.1% in Feb, in-line with estimates, primarily led by a 4.4% fall in sales by gas stations

Consumer price index for US slipped 0.2% in Feb on the back of sharp drop in energy prices

Industrial production in the US slipped 0.5% in Feb, following a revised 0.8% increase in Jan

University of Michigan’s consumer sentiment index slipped to a 5-month low of 90 in Mar

Brazil central bank’s economic activity index (IBC-BR index) unexpectedly shrank 0.61% in Jan amid political crisis

Europe

Eurozone’s Jan industrial production grew at fastest rate since Sep 2009 by 2.1% MoM, after dipping 0.5% in Dec

Employment in 4Q15 in Eurozone rose 0.3% QoQ (same as in 3Q15), while it grew 1.2% on YoY basis

German producer prices index slid 3.0% YOY in Feb (vs. -2.4% in Jan), largely driven by a 9.4% fall in energy prices

UK’s unemployment rate in the three months to January stood at a 10-year low of 5.1%, meeting expectations

Rest of the World

Paris-based OECD said G20 nations’ real GDP growth in FY15 weakened to 3.2% from 3.3% in FY14

China’s retail sales growth edged down to10.2% in Jan & Feb (vs. 11.1% in Dec), slowest pace since May 2015

Industrial production grew 5.4% in Jan & Feb combined (vs. 5.9% growth recorded in Dec)

Japan’s industrial production rose a seasonally-adjusted 3.7% MoM in Jan after falling in previous two months

Fitch Ratings affirmed Australia’s 'AAA' credit rating with stable outlook and forecasted 2.6% GDP growth for FY16

S&P 500 – 1 year performance Euro Stoxx 600 – 1 year performance

Source: Bloomberg, Mashreq Private Banking; *Current

INTERNATIONAL EQUITY MARKETS

Last Close 5 Day % YTD % P/E (2015) *Div. Yield

S&P 500 2,049.58 1.35 0.28 17.28 2.21

DJI 17,602.30 2.26 1.02 16.10 2.58

Nasdaq Comp 4,795.65 0.99 -4.23 20.24 1.33

Euro Stoxx 600 341.71 -0.15 -6.59 15.43 3.65

FTSE 100 6,189.64 0.81 -0.84 16.48 4.33

Dax 9,950.80 1.22 -7.37 12.54 3.02

CAC 40 4,462.51 -0.67 -3.76 14.58 3.45

Nikkei 225 16,724.81 -1.26 -12.13 17.31 1.95

Hang Seng 20,671.63 2.34 -5.67 10.96 4.07

Brazil - Bovespa

50,814.66 2.37 17.22 14.06 3.68

Russia - Micex 1,914.02 2.00 8.67 4.57 4.37

BSE Sensex 24,952.74 0.95 -4.46 17.86 1.61

Shanghai Comp 2,955.15 5.15 -16.50 12.61 2.07

Source: Bloomberg, Mashreq Private Banking

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UAE

Meraas Holding raised AED1.4bn loan from a group of banks for the AED2.8bn Marsa Al Seef project on Dubai creek

Sharjah Islamic Bank reportedly seeks to raise $200mn worth syndicated loan with an option to increase its size

Meydan Group inked deal to obtain $476mn worth financing from Qatar National Bank & Commercial Bank Int.

DP World mulls launching an initial public offering for its new holding company in India, Hindustan Ports Pvt. Ltd.

DP World’s FY15 net profit jumped 30.7% YoY to $883mn; BoD raised dividend to $0.3/share (vs. $0.235 in FY14)

Dubai Islamic Bank mandated banks to arrange meet with investors for Sukuk issue under its $2.5bn Sukuk program

Aldar properties will introduce new dividend policy from 2016 onwards which could lead to higher dividends

Saudi Arabia

Moody’s Investors Service revised its outlook for Saudi Arabia’s banking system to ‘negative’ from ‘stable’

ACWA Power launched $328mn solar power plant in the Northern Cape province in South Africa; ACWA Power International acquired 70% stake in Jordan-based Sunrise Solar Energy

National Industrialization Co. is reportedly in talks with lenders to refinance ~SAR6bn debt at its titanium business

Rest of GCC

Oman Oil Refineries & Petroleum Industries closed $3.8bn project financing facility for Liwa Plastic Industries

Gulf Bank received Capital Markets Authority’s nod to issue a capital-boosting bond worth up to KWD100mn

Al Khalij Commercial Bank denied that it is in talks for a 3-way merger with Ahli Bank & International Bank of Qatar

Qatar Fuel Co’s shareholders approved QAR8.2 per share cash dividends, in addition to 8% bonus shares for FY15

Last Close 5 Day % YTD % P/E (2015) *Div. Yield

Dubai 3,384.63 0.88 7.41 9.59 3.67

Abu Dhabi 4,478.73 -0.47 3.98 9.80 5.55

Saudi Tadawul 6,394.67 0.63 -7.48 12.64 3.98

Qatar Index 10,425.97 0.38 -0.03 12.11 4.05

Kuwait Index 5,262.07 -0.43 -6.29 – 4.77

Oman MSM 30 5,326.67 0.68 -1.47 9.15 4.61

Bahrain All Share

1,162.82 0.71 -4.36 – 5.70

Egypt EGX 30 7,485.69 14.05 6.85 9.01 1.64

Istanbul 100 Index

82,943.44 4.49 15.64 9.40 3.01

Source: Bloomberg, Mashreq Private Banking; *Current

DFMGI – 1 year performance Saudi Tadawul – 1 year performance

GCC EQUITIES


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US dollar index declined for a third straight week by 1.13% in the wake of the Federal Reserve’s cautious view on global market developments

Euro strengthened 1.02% against US dollar in the week ended Mar 18 after the Federal Reserve held interest rates steady while lowering expectations for the number of rate hikes in 2016

British pound gained 0.65% this week against US dollar on the back of positive comments from the Bank of England (BoE). The BoE downplayed signs that the economy is slowing, highlighting erratic and Brexit-related uncertainties and reminded markets it is primarily focused on inflation expectations

Brazil’s real depreciated 1.08% against US dollar from Mar 11, following a news report that the central bank president may step down, adding to political turmoil that has rattled markets recently

Russian ruble appreciated 2.11% against US dollar during the past five days as crude oil prices firmed up on hopes key producers will agree in April to limit output amid a global supply glut

Indian rupee ended the week gaining 0.82% against US dollar, aided by increased selling of the US currency by exporters and banks amidst sustained foreign fund inflows

Last Close 5 Day % 1 Mth. % YTD % 1 Year %

USD Index 95.0860 -1.13 -1.76 -3.59 -2.88

EUR/USD 1.1270 1.02 1.28 3.76 4.15

GBP/USD 1.4476 0.65 1.27 -1.76 -3.16

USD/JPY 111.5500 -2.03 -2.23 -7.21 -7.07

USD/CHF 0.9695 -1.31 -2.32 -3.25 -0.58

USD/CAD 1.3004 -1.55 -4.89 -6.03 3.60

USD/BRL 3.6242 1.08 -9.17 -8.50 12.18

USD/RUB 68.2400 -2.11 -9.01 -5.90 15.09

USD/INR 66.5063 -0.82 -2.87 0.53 6.46

USD/CNY 6.4716 -0.35 -0.87 -0.34 4.30

USD/AUD 1.3143 -0.58 -5.57 -4.23 2.18

EUR/USD – 1 year performance GBP/USD – 1 year performance


CURRENCIES


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Brent crude futures crossed $40 per barrel while US West Texas Intermediate (WTI) futures rose 2.44% this week as central banks from the US to Norway signaled they will continue to provide economic stimulus to support demand

Spot gold prices edged up 0.37% during the week ended Mar 18 on safe haven appeal as US dollar weakened after the Federal Reserve scaled back rate increase expectations

Shanghai steel rebar futures rose 8.22% this week, tracking firmer equities and other commodities as risk-appetite increased after the US Federal Reserve signaled fewer interest rate increases in 2016 amid global headwinds

Sugar at the ICE Futures US exchange gained 5.5% over the past five trading days amid growing concerns over supplies in the world’s top producers – Brazil, India and Thailand

The Malaysian Derivatives Exchange (MDE) palm oil futures moved up 3.3% this week over forecasts for dry weather in Malaysia, which prompted worries over reduced palm-oil production in that country

The Chicago Board of Trade (CBoT) soybean futures increased 1.07% from Mar 11, helped by strength in the energy market and higher prices for soybean oil, which in-turn followed palm-oil prices which gained on the back of weather threats in Southeast Asia


Brent – ICE 41.20 2.01 19.42 10.52 -25.52

WTI – Nymex 39.44 2.44 28.64 6.48 -13.74

Gold Spot 1,255.32 0.37 3.87 18.27 6.15

Silver Spot 15.80 2.85 3.40 14.03 -5.65

Copper - CMX 227.95 1.83 9.83 6.77 -17.86

S&P GSCI Spot Index

335.30 1.17 11.61 7.59 -15.79

Baltic Dry Index 395.00 1.80 28.66 -17.36 -33.16

WTI Crude – 1 year performance GOLD – 1 year performance


COMMODITIES


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The US Federal Reserve left its benchmark interest rate unchanged on Mar 16 and signaled lesser number of rate hikes in 2016 (two vs. four earlier). The Fed also cut 2016 inflation and GDP forecast to 1.2% & 2.2% from 1.6% & 2.4%, respectively

The Bank of England (BoE) policymakers voted 9-0 to hold the interest rate at 0.50% on Mar 17 and maintain quantitative easing at £375bn. BoE said the path that Bank Rate would actually follow over next few years would depend on economic circumstances

The Bank of Japan (BoJ) policymakers voted 7-2 to maintain -0.1% interest rate on Mar 15, which it had introduced in Jan to achieve its 2% inflation. The BoJ also kept its monetary base at an annual pace of ~¥ 80tn

The Swiss National Bank (SNB) retained interest rate on sight deposits at the central bank at -0.75% on Mar 17. The SNB repeated it will be active in the foreign exchange market as the Swiss franc remains significantly overvalued

Russia’s central bank left its key interest rate unchanged at 11% for a fifth consecutive month on Mar 17, in-line with expectations. The bank said inflation risks remain high, despite certain stabilization in financial and commodity markets and a slowdown in inflation

Bank Indonesia slashed its key interest rate by a quarter-point to 6.75% on Mar 17 and said there was more room for easing amid declining inflationary pressures and less global uncertainty


USD-10yr 1.87 -5.58 5.69 -17.46 -4.84

USD-2yr 0.84 -12.57 16.06 -20.27 37.11

Fed Funds Rate 0.37 2.78 -2.63 85.00 208.33

USD-3m Libor 0.62 -1.51 0.99 1.89 135.99

USD-6m Libor 0.89 -1.58 2.93 5.32 126.28

German-10yr 0.21 -21.77 -20.30 -66.30 13.37

UK-10yr 1.45 -8.06 0.56 -26.12 -5.54

Japan-10yr (0.10) 653.85 -492.00 -137.69 -129.61

AED-3m EIBOR 1.03 -0.80 -0.88 -2.72 46.29

AED-6m EIBOR 1.27 0.56 1.59 4.34 47.65

US 10 year Generic Yield – 1 year performance UK 10 year Generic Yield – 1 year performance


INTEREST RATES


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Ref Country Weekly Change Weekly Change

(USD Adj.)

1 Ukraine -6.05% -9.94%

2 Venezuela -5.94% -5.94%

3 Luxembourg -3.75% -2.76%

4 Greece -3.11% -2.12%

5 Mongolia -2.48% -2.44%

6 Ireland -2.37% -1.37%

7 Switzerland -2.31% -1.01%

8 Denmark -2.00% -0.88%

9 Italy -1.98% -0.98%

10 Sweden -1.90% -0.60%

Ref Country Weekly Change Weekly Change

(USD Adj.)

1 Egypt 14.05% 0.63%

2 Namibia 7.35% 7.07%

3 Peru 6.14% 5.54%

4 China 5.15% 5.53%

5 Russia 4.68% 4.68%

6 Turkey 4.49% 4.52%

7 South Africa 4.03% 3.76%

8 Portugal 3.39% 4.44%

9 Romania 3.32% 4.23%

10 Chile 3.20% 4.36%

WEEKLY

Ref Country YTD Change YTD Change (USD Adj.)

1 Peru 21.72% 22.96%

2 Kazakhstan 19.16% 17.22%

3 Brazil 17.22% 28.11%

4 Russia 16.92% 16.92%

5 Namibia 15.93% 17.47%

6 Turkey 15.64% 17.64%

7 Colombia 13.53% 17.28%

8 Slovakia 13.37% 17.63%

9 Argentina 10.55% -3.28%

10 Tunisia 8.79% 10.57%

YTD

Ref Country YTD Change YTD Change (USD Adj.)

1 China -16.50% -16.22%

2 Mongolia -14.79% -16.96%

3 Italy -13.11% -9.84%

4 Greece -13.11% -9.85%

5 Sri Lanka -12.14% -12.61%

6 Japan -12.13% -5.30%

7 Switzerland -11.39% -8.41%

8 Nigeria -10.29% -10.18%

9 Ireland -8.84% -5.41%

10 Ukraine -7.63% -16.56%

EQUITY MARKETS - TOP MOST & BOTTOM MOST


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Ref Commodity Weekly Change

1 Aluminum -2.59%

2 Lead -2.38%

3 Bean Meal -1.99%

4 Nickel -1.93%

5 Wheat -1.44%

6 Gasoline -1.18%

7 Lean Hogs -0.52%

8 Ethanol -0.35%

9

10

Ref Commodity Weekly Change

1 Steel Rebar 8.22%

2 Coffee 7.96%

3 Sugar 5.55%

4 Orange Juice 5.23%

5 Natural Gas 4.67%

6 Soybean Oil 4.67%

7 Rough Rice 3.52%

8 Rubber 3.37%

9 Palm Oil 3.30%

10 Lumber 3.12%

WEEKLY

Ref Commodity YTD Pct Change

1 Lean Hogs 19.48%

2 Gold 18.27%

3 Steel Rebar 18.03%

4 Tin 16.11%

5 Lumber 15.33%

6 Gasoil 14.94%

7 Zinc 14.54%

8 Silver 14.03%

9 Gasoline 12.64%

10 Heat Oil 12.57%

YTD

Ref Commodity YTD Pct Change

1 Natural Gas -18.40%

2 Cotton -9.67%

3 Rough Rice -9.64%

4 Orange Juice -8.75%

5 Cocoa -2.90%

6 Feeder Cattle -2.20%

7 Nickel -1.81%

8 Wheat -1.49%

9

10

COMMODITY MARKETS - TOP MOST & BOTTOM MOST


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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.

weekly market review - mashreq€¦ · consumer price index for us slipped 0.2% in feb on the back...

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