PM — EGP slips again

Happy THURSDAY, wonderful people. We made it through the first work week of 2023 and are being rewarded with another long weekend. Merry Christmas to all of our Coptic Christmas friends and anybody else who is observing the day this weekend.

PSA- EnterprisePM is taking a day off this coming Sunday, 8 January, as the public and private sector, banks, and the EGX will be on holiday in observance of Coptic Christmas. We’ll be back in your inboxes at the usual time on Monday, 9 January.

THE BIG STORY TODAY

EGP WATCH- The EGP broke the 27 / USD 1 barrier, slipping another 1.9% against the greenback today at several banks. The decline comes after the Central Bank of Egypt allowed the EGP to slide yesterday — dipping nearly 7% — after the country’s two biggest state-owned banks introduced certificates of deposit with a record-high yield of 25%.

THE BIG STORY ABROAD

The international press is still broadly focused on the US House of Representatives’ struggle to vote in a new speaker, after Republican leader Kevin McCarthy failed to secure the necessary votes in all six rounds. The story is on the front pages of Reuters, the Financial Times, and the Wall Street Journal.

** CATCH UP QUICK on the top stories from today’s EnterpriseAM:

• CBE lets EGP slide as Big Two state-owned banks announce 25% CDs: The Central Bank of Egypt made a big move on the FX front yesterday, allowing the EGP to slide against the greenback at the same time as the nation’s two largest banks announced high-yield local-currency certificates of deposit.
• Auto sales slump to fresh low: November marked another rough month for auto sales, which fell to their lowest level since at least the start of 2018 as the industry continued to face import restrictions.
• Is an Egypt-Italy electricity interconnection project coming? Italy has reportedly submitted a proposal to the Egyptian Electricity Transmission Company to work on a joint USD 2.8 bn electricity interconnection project between the two countries with a capacity of 2.5-3 GW.

???? CIRCLE YOUR CALENDAR-

The House of Representatives adjourned on Tuesday and will reconvene plenary sessions on Sunday, 15 January.

The key news triggers in the days and weeks ahead:

• Inflation figures for December will be released on Tuesday, 10 January.
• The national dialogue will kick off on Saturday, 14 January.
• The government’s fuel pricing committee will meet this month to decide quarterly fuel prices.
• Global movers and shakers will descend on Davos for the World Economic Forum’s annual meetings on 16-20 January.
• The IMF will publish an updated World Economic Outlook towards the end of the month.

Check out our full calendar on the web for a comprehensive listing of upcoming news events, national holidays and news triggers.

☀️ THIS WEEKEND’S WEATHER- We’re in for very seasonable weather for Christmas weekend, with daytime highs of 20°C and overnight lows of 9°C all three days. There’s a 90% chance of up to 5 mm of rain on Sunday evening, our favorite weather app says, suggesting we’ll start the work week on Monday with cooler temperatures (a daytime high of 16°C) and a possibility of 3-4 mm of rain.

The layoff wave hitting tech players isn’t over yet: NYSE-listed tech giant Salesforce is reducing its 79k+ headcount by 10%, making it the latest tech company to slash expenses as uncertainty continues to draw a bleak picture for the global economy, CNN reports, citing a letter sent out to employees. Video-sharing platform Vimeo followed suit on the same day and announced its plans to lay off 11% of its employees, the news outlet reports. The demand for tech companies saw a skyrocketing rise fueled by the pandemic-induced work-from-home trend, which is coming to a halt, forcing these firms to “quickly adjust to a softening demand environment,” CNN quotes an analyst as saying. Amazon, Meta, and Twitter each pushed through layoffs last year. CNBC and Insider also had the story.

Amazon is also planning (another) drastic job cut: The e-commerce giant plans to eliminate 18k jobs — 6% of the company's 300k-person corporate workforce — to reduce expenses, CEO Andy Jassy announced to employees yesterday in a message that has since been shared in a blog post. The company’s e-commerce and human resources divisions will be hit the hardest by the layoffs, the details of which will be announced on 18 January, The Financial Times reports.

DATA POINT- According to tracking website Layoffs.fyi, the tech sector laid off more than 150k people in 2022, a figure that shows no sign of slowing, according to Reuters.

Foxconn’s monopoly on iPhone manufacturing is slipping: Apple is set to outsource production of the iPhone 14 Pro Max model to Chinese manufacturer Luxshare Precision, a direct competitor of Foxconn and Pegatron, the Financial Times reports, citing sources familiar with the matter. Luxshare has already been producing small components of the iPhone 14 Pro Max at its factory in Shanghai, as Apple looks to offset slower production at the Taiwanese Foxconn plant since November of last year.

In its bid to diversify its production facilities, Apple has made significant investments in Luxshare’s supply chain management. Luxshare has delivered last minute orders of mass producing the Pro models in just a few months, an analyst says. The company is now Luxshare’s largest commercial partner, driving a jump in revenues to USD 24 bn in 2021, from USD 2 bn in 2016.

REMEMBER: Foxconn is attempting to expand its assembly and production lines to other markets such as India, Vietnam, and the US following challenges at its Zhengzhou plant. Moreover, Foxconn has had worker disruptions due to alleged clashes with authorities, as well as lockdowns as the Covid-19 pandemic disseminated once more in the city — leading to “shortages of iPhones and threats to break Apple’s 14-quarter revenue growth streak.” Nonetheless, Foxconn was able to deliver 90% of its initial targets in December, the Financial Times quoted Foxconn this week.

???? ON THE TUBE TONIGHT-
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Roald Dahl’s Matilda the Musical takes the small screen by storm. The Netflix movie tells the classic story of Matilda, a young girl with a unique personality — and an unexpected gift. Unlike her family members, who are ignorant and look down on education, Matilda has a bright mind. She likes to read, and has a vivid imagination that leads her to embark on a once in a lifetime adventure. With a mix of magic, music, and a perfectly scripted plot, Matilda sets out to overcome any challenge that comes her way, inspiring the audience to never stop learning, and dreaming.

⚽ Brace yourselves for a jam-packed football schedule over the long weekend, with everything from the Egyptian League, the English Premier League, La Liga, and more.

Egyptian League: Frontrunner Al Ahly will face Enppi in an away game at 5pm tonight, while Zamalek (second in the league) will play against El Dakhleya at 7pm. Al Ahmar (27 points) managed to get a leg up against Al Abyad (24 points), the defending champion for the last two seasons, after its victory over Pyramids and Zamalek’s defeat against Aswan.

Saturday + Sunday in the Egyptian League:

Pyramids v Ghazl El Mahalla (2:45pm Saturday)

Al Masry v Al Ittihad Al Sakandary (7pm Saturday)

Ceramica v Future (7pm Saturday)

Haras El Hodoud v Ismaili (2:45pm Sunday)

National Bank v Aswan (2:45pm Sunday)

Smouha v Pharco (7pm Sunday)

El Gaish v Arab Contractors (7pm Sunday)

English Premier League: Manchester City is seeking to narrow the gap with league leaders Arsenal (who lost two points in a draw with Newcastle yesterday), but for that it will have to beat Chelsea at home, in the Stamford Bridge match that starts at 10pm.

La Liga: The Spanish League returns tomorrow after a long hiatus with two matches: Elche plays Celta Vigo at 7:30pm and Valencia faces Cadiz at 10pm. Then on Saturday, Real Madrid will face a difficult away game against Villarreal at 5:15 pm, followed by Real Mallorca v Valladolid at 7:30pm and Espanyol v Girona at 10pm.

And on Sunday: Almeria plays against Real Sociedad at 3pm, Rayo Vallecano plays against Real Betis at 5:15pm, and Seville plays Getafe at 7:30pm. Finally, Atletico Madrid faces off against Barcelona at 10pm.

FA Cup: Manchester United will hit the field against Everton, at 10pm on Friday.

Saturday/Sunday matches in the FA Cup:

Crystal Palace v Southampton (2:30pm Saturday)

Tottenham v Portsmouth (2:30pm Saturday)

Middlesbrough v Brighton (5pm Saturday)

Brentford v West Ham (7:30pm Saturday)

Liverpool v Wolverhampton (10pm Saturday)

Man City v Chelsea (6:30pm Sunday)

Serie A:

Juventus v Udinese (7pm Saturday)

Monza v Inter Milan (9:45pm Saturday)

Sampdoria v Napoli (7pm Sunday)

Milan v Roma (9:45pm Sunday)

Gulf 25: The 25th edition of the Arabian Gulf Football Championship, which includes eight teams divided into two groups, will be hosted in Basra, Iraq. Kuwait has historically dominated the championship having clinched 10 titles, while Saudi Arabia, Qatar, and Iraq tie for second place with three titles each. All participating teams have taken home the cup at least once, except for Yemen (despite participating nine times). Bahrain is the defending champion, having come out on top in the last edition of the championship in 2019 for the first time in its history.

The tournament kicks off tomorrow, with a match between Iraq and Oman in the first group at 5:45pm, after which Yemen will play with Saudi Arabia at 8:30pm.

The second group matches start on Saturday: Bahrain will face the UAE at 3:15 pm, and Kuwait face Qatar at 6:15pm.

???? EAT THIS TONIGHT-

Jones The Grocer “takes their breakfast very seriously.” Open in O1 New Cairo, and Galleria40, the not your typical supermarket, instead bringing together a deli, bakery, and a cafe with a curated gourmet menu. Although everything we’ve tried on their breakfast menu was exquisite in taste and quality, Jones The Grocer is especially proud of their muffins, cereals, and coffee. We were personally fond of the glorious granola bowl, and smokey florentine. The cafe also offers healthy brunch options, such as delicious salads, soups, sandwiches, and wraps — any one of which makes for the perfect meal during a workday break. They also have cured and matured protein dishes, wood-fired oven pizza, and, of course, a satisfying dessert selection for dinner later in the day.

???? OUT AND ABOUT-
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MV Logos Hope, the world’s largest floating book fair has docked in Port Said, in its second visit to Egypt in over a decade. The ship will open its floating display to thousands of daily visitors until 23 January when it continues its voyage to Aqaba, Jordan. Entrance fees are set at EGP 5.

Don't miss out on Aguizi’s Birthday Bash night at Cairo Jazz Club in Agouza at 9pm, featuring Moenes, Novo, and Aguizi and Fahim.

Amy Frega will be performing at Room Art Space Garden City tonight at 9pm, playing a mix of soul, funk, and international cultural beats.

It’s Electric Thursday at CJC 610 with Los Profundos, AlgoPack, and Ahmed Eid taking over the stage at 9pm.

???? EARS TO THE GROUND-

Get to know China’s president: Xi Jinping is arguably one of the most powerful people on the planet. He secured a historic third term as general secretary of the Communist Party, president of the country, and leader of the military, and could potentially rule the country for the remainder of his life. Despite his influential position, much about Xi is still unknown. In The Economist’s eight-part audio series The Prince: Searching for Xi Jinping, Sue-Lin Wong investigates how he achieved success, and what the changes he made mean for China and the world at large.

???? UNDER THE LAMPLIGHT-

Mystery buffs, we’ve got your weekend read covered: A Death in Tokyo is the latest book in The Kyoichiro Kaga Series from international bestselling author Keigo Higashino. The book begins with a corpse being discovered on the Nihonbashi Bridge and detectives Kyoichiro Kaga and Shuhei Matsumiya are tasked with investigating the high profile case. The main suspect in the case gets hit by a truck on the same night of the murder and ends up in a coma. Unable to question the main suspect, the case is considered open-and-shut, but Kaga is convinced that the case needs a closer look.

The EGX30 rose 2.7% at today’s close on turnover of EGP 3.12 bn (97.3% above the 90-day average). Regional investors were net buyers. The index is up 9.6% YTD.

In the green: Eastern Company (+14.3%), Fawry (+8.0%) and Credit Agricole Egypt (+8.0%).

In the red: Ezz Steel (-3.5%), Cleopatra Hospitals (-3.4%) and Rameda Pharma (-3.1%).