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Monday, 25 January 2021

What the markets are doing on 25 January 2021

Investors might be pinning their hopes on the Fed to maintain the emerging-market rally, which showed signs of faltering late last week, Bloomberg says. Vaccine hopes and optimism over the global recovery has pushed EM stocks to record highs in recent weeks but declines in local-currency bonds and a basket of currencies on Friday indicated increasing anxiety over the global economy. Traders will be looking to Washington on Wednesday when the Fed holds its policy meeting for signs that it will keep the liquidity taps on, the business information service says.

GLOBAL M&A WATCH- Advisers are bullish that the 2020 tech M&A boom will continue this year, Bloomberg reports. Volume hit a record USD 470 bn last year as surging tech stocks and central bank liquidity provoked a wave of market concentration. Analysts expect it to continue this year, predicting enterprise technology companies with market values in the range of USD 20-100 bn to look at acquisitions in a bid to eclipse companies such as Adobe and Salesforce.

The red-hot market for IPOs and blank-check companies won’t necessarily work against M&A: “[The IPO market] actually spawns more SPACs, which in turn drive M&A volume,” said Marco Caggiano, JPMorgan Chase & Co.’s co-head of North America M&A.

Biden’s regulatory + tax plans could pose a stumbling block: Questions remain about how the new Biden administration will react to major acquisitions in the tech sector, which is facing more scrutiny from Capitol Hill than ever before, while tax changes could also push CEOs to finalize transactions earlier.

Down

EGX30

11,525

-1.1% (YTD: +6.3%)

None

USD (CBE)

Buy 15.67

Sell 15.77

None

USD at CIB

Buy 15.67

Sell 15.77

None

Interest rates CBE

8.25% deposit

9.25% lending

Down

Tadawul

8,829

-0.5% (YTD: +1.6%)

None

ADX

5,613

– (YTD: +11.3%)

Down

DFM

2,715

-0.7% (YTD: +9.0%)

Down

S&P 500

3,841

-0.3% (YTD: +2.3%)

Down

FTSE 100

6,695

-0.3% (YTD: +3.6%)

Down

Brent crude

USD 55.41

-1.2%

Down

Natural gas (Nymex)

USD 2.45

-1.8%

Down

Gold

USD 1,855

-0.8%

Down

BTC

USD 31,978

-1.2% (as of midnight)

The EGX30 fell 1.1% yesterday on turnover of EGP 1.5 bn (9.5% above the 90-day average). Regional investors were net buyers. The index is up 6.3% YTD.

In the green: Dice (+3.5%), Orascom Development Egypt (+1.9%) and Beltone Financial Investment (+0.7%).

In the red: Edita (-2.2%), Ezz Steel (-1.9%) and CIB (-1.9%).

Asian shares were mostly in the green during early trading this morning. The picture looks mixed for Europe while US futures have markets opening in the green later today.

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