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Wednesday, 28 April 2021

What the markets are doing on 28 April 2021

Yesterday was a huge day for tech earnings: Google parent Alphabet smashed sales records in 1Q thanks to a splurge in digital ad spending, the Financial Times reports. Revenues hit a record USD 55.3 bn during the three-month period, causing net profit to surge 162% to USD 17.9 bn, blowing past analysts’ forecasts of USD 10.5 bn. The company announced plans to spend USD 50 bn on share buybacks, sending its share price 4.5% higher in after hours trading, and handing it a record USD 1.6 tn market cap.

Microsoft’s earnings also beat expectations, led by its cloud business and strong sales of PCs and games consoles, the FT says. The company’s revenues were up 19% during the quarter to USD 41.7 bn, narrowly beating analysts’ forecasts of USD 41 bn. All three of Microsoft’s cloud divisions saw large revenue growth with its Intelligent Cloud business delivering the strongest performance.

UBS’ net income in 1Q2021 increased 14% y-o-y on record-high client activity levels, despite the Swiss outfit reporting USD 861 mn in losses after the collapse of Archegos Capital Management, according to an earnings release (pdf). UBS said it had completely liquidated its exposure to Archegos this month, which resulted in an overall drop of USD 434 mn in its quarterly net profits. The blow, however, was less severe than that suffered by the bank’s peers including Credit Suisse’s USD 5.5 bn Archegos hit.

A “leading” foreign energy company is in talks with the Saudi government to purchase a 1% stake in Saudi Aramco, Crown Prince Mohamed bin Salman told local media, Bloomberg reports. Aramco — still the world’s most valuable company despite the tumult in the oil markets last year — could also go ahead with secondary offerings in the next two years, he said. The government listed a 1.5% stake on the Saudi Tadawul in 2019, raising some USD 30 bn and setting a record for the largest IPO in history.

Turkey could look to regulate its crypto market after the country’s Thodex and Vebitcoin exchanges collapsed last week, a senior Turkish official told Bloomberg.

Abu Dhabi and Qatar are the only two sovereigns in the GCC expected to record fiscal surpluses this year, as other MENA oil exporters are still reeling from the covid-19 shock to oil prices, according to Fitch Ratings.

Up EGX30 10,591 +0.6% (YTD: -2.3%)
None USD (CBE) Buy 15.63 Sell 15.73
None USD at CIB Buy 15.63 Sell 15.73
None Interest rates CBE 8.25% deposit 9.25% lending
Up Tadawul 10,267 +0.4% (YTD: +18.2%)
Down ADX 6,120 -0.4% (YTD: +21.3%)
Down DFM 2,630 -0.6% (YTD: +5.5%)
None S&P 500 4,186 -% (YTD: +11.5%)
Down FTSE 100 6,944 -0.3% (YTD: +7.5%)
Up Brent crude USD 66.59 +0.3%
Up Natural gas (Nymex) USD 2.88 +0.1%
Down Gold USD 1,772.00 -0.4%
Up BTC USD 55,502 +3.2% (as of midnight)

The EGX30 rose 0.6% yesterday on turnover of EGP 976 mn (23.9% below the 90-day average). Local investors were net sellers. The index is down 2.3% YTD.

In the green: Export Development Bank (+4.0%), Credit Agricole (+3.6%) and Qalaa Holdings (+3.4%).

In the red: GB Auto (-2.6%), Telecom Egypt (-1.5%) and Oriental Weavers (-1.4%).

Asian markets are down in early trading this morning and US and European futures point to markets opening in the green ahead of the Fed announcement later today.

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