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Monday, 19 September 2016

BY THE NUMBERS

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Pharos Holding - http://www.pharosholding.com/

USD CBE auction (Tuesday, 06 Sep): 8.78 (unchanged since Wednesday, 16 March)
USD parallel market (Sunday, 18 Sep): 12.80 (from 12.60 on Saturday, 17 Sep, Sada El Balad)

EGX30 (Sunday): 7,916.4 (-0.8%)
Turnover: EGP 275.6 mn (37% below the 90-day average)
EGX 30 year-to-date: +13.0%

Foreigners: Net Long | EGP +18.0 mn
Regional: Net Short | EGP -20.7 mn
Domestic: Net Long | EGP +2.7 mn

Retail: 62.2% of total trades | 63.4% of buyers | 61.0% of sellers
Institutions: 37.8% of total trades | 36.6% of buyers | 39.0% of sellers

Foreign: 14.6% of total | 17.9% of buyers | 11.4% of sellers
Regional: 12.2% of total | 8.4% of buyers | 15.9% of sellers
Domestic: 73.2% of total | 73.7% of buyers | 72.7% of sellers

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PHAROS VIEW

Expect MPC to Raise Rates 1 ppt on Thursday; eyeing another 1 ppt hike in November

Pharos Research believes that the MPC will raise policy rates by 1 percentage point during its upcoming meeting on September 22, mostly due to inflationary concerns and in preparation for devaluation, to increase the attraction of holding EGP versus USD and in a bet to attract foreign fund inflows into the EGP fixed income market, post-devaluation. Pharos believes that another 1 ppt hike in policy rates is much needed for EGP defense, but would probably be implemented at the 17 November MPC meeting to account for the inflation spike induced by VAT and depreciation. Tap here to read the full research note, highlights of which include:

  • Inflation Spiked in August; More to Show After VAT and Devaluation
  • We Realize Growth Dynamics Not Supportive of a Rate Hike
  • Higher Rates Hurt Equities; Market to Move Sideways
  • Maintain Conservative ST Trading Tactics; Security Selection is Key

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WTI: USD 43.72 (+1.60%)
Brent: USD 46.45 (+1.49%)
Natural Gas (Nymex, futures prices) USD 2.95 MMBtu, (+0.03%, Oct 2016 contract)
Gold: USD 1,317.80 / troy ounce (+0.58%)<br
TASI: 6,060.1 (-1.9%) (YTD: -12.3%)
ADX: 4,486.3 (0.3%) (YTD: +4.2%)
DFM: 3,483.3 (0.0%) (YTD: +10.5%)
KSE Weighted Index: 349.7 (0.3%) (YTD: -8.4%)
QE: 10,572.5 (0.4%) (YTD: +1.4%)
MSM: 5,779.2 (0.0%) (YTD: +6.9%)
BB: 1,128.4 (+0.3%) (YTD: -7.2%)

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