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Thursday, 17 December 2020

What the markets are doing on 17 December 2020

The EGX30 fell 0.7% yesterday on turnover of EGP 1.5 bn (9.5% above the 90-day average). Foreign investors were net sellers. The index is down 21.3% YTD.

In the green: Sidi Kerir Petrochemicals (+1.8%), Ezz Steel (+1.3%) and EFG Hermes (+0.4%).

In the red: Beltone Financial Holding (-3.9%), GB Auto (-3.7%) and Egyptian Iron and Steel (-3.1%).

Asian shares are mixed this morning, but futures suggest Europe and Wall Street will all open in the green later today.

Down

EGX30

10,983

-0.7% (YTD: -21.3%)

Down

USD (CBE)

Buy 15.65

Sell 15.75

Down

USD at CIB

Buy 15.64

Sell 15.74

None

Interest rates CBE

8.25% deposit

9.25% lending

Up

Tadawul

8,721

+0.7% (YTD: +4.0%)

Up

ADX

5,154

+0.4% (YTD: +1.5%)

Up

DFM

2,541

+0.4% (YTD: -8.1%)

Up

S&P 500

3,701

+0.2% (YTD: +14.6%)

Up

FTSE 100

6,571

+0.9% (YTD: -12.9%)

Up

Brent crude

USD 51.18

+0.2%

Up

Natural gas (Nymex)

USD 2.71

+1.3%

Up

Gold

USD 1,867.90

+0.5%

Up

BTC

USD 21,431.87

+10.7%

The US Federal Reserve vowed to keep buying bonds until it sees a “substantial” progress on the economy as it wrapped its two-day FOMC meeting yesterday. Fed officials “upgraded their economic projections but maintained predictions that they would keep rates close to zero until at least the end of 2023,” the Financial Times reports. Reuters also has the story. Meanwhile, the Fed has also joined the fight against climate change.

Saudi Arabia is pouring hundreds of bns of SAR into local investments through its wealth funds to narrow its budget deficit as of next year, after its economy was battered this year by low oil prices, Bloomberg reports. Cushioned by revenues that will reach SAR 849 bn in 2021, the kingdom’s budget will remain “expansionary” for the coming period even as government spending is slashed, Saudi Finance Minister Mohammed Al-Jadaan said.

Low oil demand will likely stick around for a little while longer, despite a rebound in oil prices earlier this week that reached USD 50/bbl due to excitement from the rollout of vaccines and a swift recovery in China, according to the International Energy Agency’s (IEA) December Oil Market Report. Driven by reductions in demand from Europe and OECD countries in 4Q2020 as they reel from renewed lockdown measures and weak demand for air travel, the group says it will be another “several months” before enough people are vaccinated for a rebound in consumption to really take hold. You can view the landing page for the report here.

The Eurozone’s economic performance exceeded expectations in December, with the bloc’s flash PMI data (pdf), but remains below the 50 mark that separates growth from contraction. Pundits had expected the reading to come in much lower as covid-19 surges in Europe.

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