Facebook just killed the tech earnings optimism: Facebook parent Meta saw its first-ever quarterly decline in revenues in 2Q 2022 as economic headwinds and competition from other companies hit its ads business. The social media metaverse giant posted a larger-than-expected fall in revenues, failed to hit earnings estimates, and provided a less-than-optimistic forecast, with CEO Mark Zuckerberg warning that “an economic downturn will have a broad impact” on its advertising revenues. “It’s always hard to predict how deep or how long these cycles will be. But I’d say that the situation seems worse than it did a quarter ago.” Meta shares fell 4.7% in after-hours trading

Its rivals were less gloomy on Tuesday, with Microsoft issuing a bullish full-year forecast and Google’s ad revenues holding up.

US retail is feeling the pinch: Best Buy followed in Walmart’s footsteps yesterday, cutting its profit outlook for the year as inflation hits consumer demand.

WATCH THIS SPACE- Apple will release today its figures for the three months ending June.

The rise of the GCC sovereign funds: Flush with oil revenues, Gulf sovereign wealth funds (SWFs) are taking advantage of the current market volatility and going on a spending spree, Bloomberg reports. Data compiled by the business newswire shows the GCC’s largest SWFs, which control over USD 3 tn in assets, spending at least USD 28.6 bn in acquisitions outside the region and Africa year-to-date, which is 45% higher than the same period last year and an all-time record for the period.

Among those in the spotlight are Abu Dhabi’s Royal Group, a conglomerate led by UAE National Security Adviser Sheikh Tahnoon Bin Zayed. Royal Group has backed a new fund launched by SoftBank Group Corporate executive Rajeev Misral; Chimera, which is now acquiring Beltone Financial here at home, is also a unit of Royal. Abu Dhabi’s Mubadala is gaining momentum, backing Wefox, approving the purchase of Swedish’s Envirotrainer, and is currently in talks to acquire Fortress Investment. It recently emerged as Klarna’s new investor after the latter’s valuation dived to USD 6.7 bn. Other sovereign wealth funds in Saudi Arabia, Qatar and Kuwait are also following suit, benefiting from a commodities boom triggered by the war in Ukraine.

ALSO FROM PLANET FINANCE-

• SpaceX is getting a European rival: French satellite operator Eutelsat is set to merge with the UK’s OneWeb creating a USD 3.4 bn European satellite communications entity large enough to rival Elon Musk’s SpaceX. (Bloomberg)
• Credit Suisse posts big 2Q losses, names new CEO: The embattled Swiss Bank officially named the head of its asset-management division, Ulrich Koerner, as its new CEO, replacing Thomas Gottstein, as it reported a CHF 1.6 bn net loss in 2Q 2022 — significantly greater than analysts’ expectations for a CHF 398 mn loss. (Earnings release, pdf)
• UAE’s Adnoc acquires ZMI Holdings: Adnoc Logistics & Services, the shipping and maritime logistics arm of Abu Dhabi National Oil Company, has bought Zakher Marine International, an Abu Dhabi-based owner and operator of offshore support vessels, for an undisclosed amount. (Statement)
• Saudi Arabia’s Neom megaproject is getting an USD 80 bn investment fund and could be IPOed on the Saudi stock exchange in 2024. (Bloomberg)
• Alibaba is planning a dual primary listing in Hong Kong, becoming the first company to benefit from a rule change by the financial hub to lure high-tech Chinese companies amid a possible exodus from New York. (Statement)

THE CLOSING BELL-

The EGX30 fell 0.7% at yesterday’s close on comparatively healthy turnover of EGP 818 mn (1.2% below the 90-day average). Local investors were net sellers. The index is down 22.3% YTD.

In the green: Rameda (+2.1%), Ezz Steel (+1.4%) and e-Finance (+1.0%).

In the red: MM Group (-4.6%), Fawry (-4.0%) and GB Auto (-3.7%).