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Tuesday, 23 March 2021

What the markets are doing on 23 March 2021

GLOBAL IPO WATCH- UK-based food delivery startup Deliveroo has kicked off its GBP 1.8 bn IPO in London, according to Bloomberg. The UK-based company is now taking investor orders at GBP 3.9-4.6 apiece, which values the company at GBP 7.6-8.8 bn, and makes for the largest IPO in the UK since September. Shares will make their debut on the LSE on 31 March.

A dash of hope for the City? The offering by Deliveroo — whose major shareholders include Amazon and VC firms DST Global and Index Ventures — comes as UK authorities are mulling proposals to reform listing rules to attract more high growth tech companies as London grapples with a potential loss of status as a major financial center post-Brexit.

Oil suffered its deepest weekly loss since October last week, with Brent futures losing 6.8% and US crude falling 6.4%, amid fears of a third wave of covid-19 in Europe, according to Bloomberg.

Just a blip? The sell-off, which saw the number of futures contracts held by traders drop 7%, was only “transient,” Goldman Sachs analysts wrote in a note, suggesting that the market rally will continue as the global vaccine rollout increases mobility.

Record flows into US equities last week signal a psychological shift in favor of riskier assets, Axios writes. Investments into US equities reached a “staggering record” of USD 68.3 bn last week — including USD 56.8 bn into equity funds — as money moved away from traditionally safe bonds and money market funds, which saw USD 9.9 bn in outflows over the same period.

This marks what Axios calls a “sea change” in investor psychology, which has traditionally seen money exit equity funds and enter fixed income and money market funds. “Investors have clearly embraced the concept of ‘There Is No Alternative’ as fund flows have nearly evaporated for government bonds … That flies in the face of recent history — 2019 saw USD 199.7 bn of equity fund outflows and 2020 saw USD 394.6 bn of outflows,” Axios says.

Down

EGX30

10,537

-2.5% (YTD: -2.8%)

Up

USD (CBE)

Buy 15.68

Sell 15.78

Up

USD at CIB

Buy 15.68

Sell 15.78

None

Interest rates CBE

8.25% deposit

9.25% lending

Up

Tadawul

9,547

+0.5% (YTD: +9.9%)

Up

ADX

5,733

+0.2% (YTD: +13.6%)

Down

DFM

2,552

-1.2% (YTD: +2.4%)

Up

S&P 500

3,941

+0.7% (YTD: +4.9%)

Up

FTSE 100

6,726

+0.3% (YTD: +4.1%)

Down

Brent crude

USD 63.89

-1.1%

Down

Natural gas (Nymex)

USD 2.57

-0.5%

Down

Gold

USD 1,734.70

-0.3%

Down

BTC

USD 55,020.06

-2.8%

The EGX30 fell 2.5% yesterday on turnover of EGP 936 mn (36.4% below the 90-day average). Foreign investors were net sellers. The index is now down 2.8% YTD.

In the green: Edita (+1.5%), Ibnsina Pharma (+1.0%)

In the red: AMOC (-7.3%), Qalaa Holdings (-5.9%) and Orascom Financial (-5.6%).

Japan’s Nikkei is the only Asian market in the green as we hit “send” on this morning’s edition, with shares in Shanghai, Hong Kong and Seoul all in the red. Futures suggest US markets will open down this morning, as will shares in Toronto and much of Europe.

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