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Tuesday, 4 May 2021

What the markets are doing on 4 May 2021

The US and Eurozone could return to pre-covid growth levels by the end of 2021, economists said, revising growth forecasts upwards after recently released figures showed stronger resilience than previously expected, the Financial Times reports. Previous IMF forecasts predicted a US recovery would not take place before mid-2022, but increased spending on the back of President Joe Biden’s USD 1.9 tn stimulus package has improved recovery prospects, economists say. The EU similarly did not record as large a contraction as predicted by the IMF, leaving it on track for a recovery during 2022.

Warren Buffett's Berkshire Hathaway returned to profitability in 1Q2021, posting net income of USD 11.7 bn compared to a loss of USD 49.7 bn a year earlier when the value of its stock investments plummeted on the back of the pandemic, according to an earnings release (pdf). Many of Berkshire’s subsidiaries have “experienced significant recoveries” and “the first quarter’s revenues and earnings for these businesses were considerably higher than in the first quarter of 2020,” Buffett said during a shareholder meeting on Saturday (watch, runtime: 5:13:53).

Berkshire resisted shareholder resolutions calling for it to report its efforts to address climate change and workforce diversity, despite growing calls among some of the world’s largest investors that climate disclosures should be a must for all companies, Reuters reports.

The Oracle of Omaha warns of incoming inflation: Buffett said his portfolio companies were “seeing very substantial inflation” in a range of sectors amid shortages of raw materials and high savings, signaling further price pressures in the US amid a “red hot” recovery from the worst of the coronavirus pandemic.

Down

EGX30

10,475

-1.1% (YTD: -3.4%)

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

Down

Tadawul

10,309

-0.5% (YTD: +18.6%)

Up

ADX

6,095

+0.3% (YTD: +20.8%)

Up

DFM

2,654

+1.1% (YTD: +6.5%)

Up

S&P 500

4,193

+0.3% (YTD: +11.6%)

Up

FTSE 100

6,970

+0.1% (YTD: +7.9%)

Up

Brent crude

USD 67.73

+0.3%

Down

Natural gas (Nymex)

USD 2.96

-0.2%

Down

Gold

USD 1,790.30

-0.1%

Down

BTC

USD 55,915.40

-3.7%

The EGX30 fell 1.1% on Wednesday on turnover of EGP 795 mn (37.8% below the 90-day average). Foreign investors were net sellers. The index is down 3.4% YTD.

In the green: Cleopatra Hospital (+1.6%), Fawry (+0.8%) and Orascom Development (+0.3%).

In the red: ElSewedy Electric (-3.1%), MM Group (-2.7%) and Oriental Weavers (-2.6%).

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