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Monday, 10 May 2021

TONIGHT: US pipeline crisis continues; global metal prices surge; Doge on the moon.

Well, that news slowdown about which we were whining this morning? It didn’t last.

THE BIG STORY THIS AFTERNOON is the end of a tie-up that would have seen EGX-listed Cleopatra Hospitals Group and Alameda Healthcare combine their businesses to create the country’s largest healthcare group by far. Neither party is saying where the transaction went off the rails, but each confirmed to us today that it did not crumble under pressure from regulators. The transaction would have been one of the larger M&As in recent memory in any sector. We have the rundown in this afternoon’s Speed Round, below.

THE BIG STORY ABROAD remains the shutdown of the US Colonial Pipeline, which still dominates the front pages of the global business press this afternoon. Traders are searching for alternative sources of fuel amid fears of shortages across the eastern US after a ransomware cyberattack took down the vast Colonial Pipeline, Bloomberg reports. The Biden administration has responded with emergency powers to keep supplies flowing and calm fears of a shortage, according to the Financial Times. The Colonial is the largest refined products pipeline in the country and transports some 2.5 mn barrels a day from the Gulf of Mexico up the eastern seaboard — or about 45% of the needs of the East coast.

More 300 Palestinians have been injured in violent clashes at Al Aqsa Mosque in Jerusalem that erupted today as Israelis celebrated Jerusalem Day — the annual celebration of the occupation of East Jerusalem in 1967. Reuters and The Associated Press have the story.

BIGGEST FAMILY BUSINESSES- Mansour Group is the second-largest family business in the Arab world, just after Saudi’s Olayan Group, which topped the list released by Forbes today. The list ranks family firms in our neck of the woods on the size of their holdings and number of employees as well as diversification, performance, and legacy. Elaraby Group is the next Egyptian business mentioned on the list, ranking in at #53, followed by Hassan Allam Holding at #75, and Memaar Al Morshedy at #82. The Orientals Group (owners of Oriental Weavers) also made it onto the list at #93.

** So, when do we eat? We sit down to eat at 6:38pm, and we’ll have until 3:26am to eat and hydrate.

** CATCH UP QUICK on the top stories from today’s EnterpriseAM:

  • The IMF will wrap up its second review of our USD 5.2 bn standby loan agreement at the end of June.
  • Some 1.7 mn doses of the AstraZeneca vaccine are being delivered today, the Health Ministry said yesterday.
  • Uber’s monopoly over the Egyptian ride-hailing market might be coming under threat, as UK-based company UVA prepares to launch next month.

Speaking of Uber, the ride-hailing company is raising fares in Egypt after the recent hike in fuel prices “to ensure that drivers continue to have sustainable earnings,” according to an email picked up by Ahram Online. In Cairo, the base fare for an average UberX ride will go to EGP 7.50 from EGP 7.25, while the EGP 2.70 per kilometer will be pushed to EGP 2.85.

🗓 CIRCLE YOUR CALENDAR-

Africa-based startups have until 26 May to sign up for the French government-sponsored AFD Digital Challenge, an annual startup competition (pdf) run by the French Development Agency (AFD). This year, the competition is targeting startups that work on environmental protection and tackle carbon emissions. The 10 startups chosen will receive a package of technical and financial support worth EUR 20k.

The IMF will conduct on 1 June a second review of targets set under Egypt’s USD 5.2 bn standby loan. The loan was approved in June 2020.

The El Gouna International Squash Open 2021 and the CIB PSA World Tour Finals will go ahead as planned, PSA World Tour announced. The El Gouna Open will take place on 20-28 May, while the CIB-sponsored World Tour Finals will run on 22-27 June in Cairo.

🚙 FOR YOUR COMMUTE-

SUPERCYCLE WATCH- Iron ore and copper prices are showing no signs of slowing, with iron ore futures surging more than 10% this morning and copper hitting a new high, according to Bloomberg. Both metals are leading a year-long raw materials and commodities boom that has gained new momentum in recent days, with the Bloomberg Commodity Spot Index now at its highest in nearly a decade having risen for 14 out of the past 15 days.

Analysts are collectively scratching their heads over today’s gains, but some have suggested that loose monetary policy and incoming environmental rules in China are simultaneously pumping demand and squeezing supply.

The bull run is stoking inflation worries, although some analysts suggest price press will be transitory as big buyers move to stabilize prices. However, a risk remains: policy tightening could come sooner than hoped.

The rally isn’t yet having an impact on inflation here in Egypt: Annual inflation slowed down in April due to a base effect from the same month last year, and analysts are saying the bull market is yet to pressure input costs. We have chapter and verse in the news well, below.

And we’ll get more of an idea how other emerging economies this week when central banks in China, Brazil, and India report inflation data. Inflation rates in developing countries are at near record-lows and the economic recovery is continuing to stoke investor interest in the asset class, Bloomberg reports.

But one indicator of inflation in EMs is at a 13-year high: Citigroup’s EM inflation-surprise index reached its highest level since 2008 last month, “a sign investors may be underestimating the scale of the resurgence,” the business news information service says. “If the stimulus continues, at some point it will become inflationary,” said Sanjiv Bhatia, chief investment officer at Pembroke Emerging Markets. “At some point, we believe it will become a problem.”


The upcoming Tokyo Olympics aren’t too popular in Japan: A survey has found 60% of the population want this year’s games cancelled thanks to fears of covid-19. The news comes just three months before they begin, Reuters reports. Japanese Prime Minister Yoshihide Suga said today that he has never “put the Olympics first” and that the games will go on with precautionary measures in place. The 2020 games, which have already been delayed a year due to the pandemic, are scheduled to begin on 23 July.


🚀 Doge is following in Laika’s footsteps (sort of): Elon Musk’s SpaceX has announced DOGE-1, a mission to the moon next year that will be funded entirely by the meme cryptocurrency Dogecoin.

Said with a completely straight face: “This mission will demonstrate the application of cryptocurrency beyond Earth’s orbit and set the foundation for interplanetary commerce … We're excited to launch DOGE-1 to the Moon,” Tom Ochinero, SpaceX VP of commercial sales, said.

An interplanetary hustle: Musk single-handedly quashed Dogecoin’s recent surge on Saturday after calling it a “hustle” on an episode of Saturday Night Live, sending the currency down by almost 30% during the show. The SpaceX announcement couldn’t fully resuscitate the doge, down 12.8% at dispatch.

Elsewhere in crypto-world, Ether has hit a new record high, smashing past USD 4k for the first time today after rising almost 7%, CNBC reports. Ether now has a total market value of USD 476.3 bn, just under half of BTC’s USD 1.1 tn.

Bidding for traction, voice-based social network Clubhouse is expanding to support Android devices, Bloomberg reports. Clubhouse for Android launched for US users Sunday, and is expected to expand to other English speaking markets within the coming weeks. The Android version will presumably expand the app’s reach, though joining is still limited to being invited by a current user.

📺 ON THE TUBE TONIGHT-

We’re sure everyone will be tuning into the Ramadan TV series finales that are coming out today. It’s always sad to say goodbye to our favorite characters.

If the inevitable Mosalsalat drama doesn’t cut it, there’s always this whale documentary: Disney+ has teamed up with National Geographic to create the docuseries Secrets of the Whales. Filmed over three years in 24 locations and narrated by Sigourney Weaver, creator Brian Skerry captures previously unseen behavioural patterns of five types of whales that suggest their communication methods and social hierarchies may be far more complicated than previously thought. You can find the docuseries on Disney+ or OSN Streaming.

It’s the local derby tonight: Al Ahly and Zamalek kick off at 9:30pm tonight in the Egyptian Premier League. Let’s keep it civil, people.

Also going down tonight in the EPL: El Gouna vs. Aswan, National Bank vs. Ismaily, and Smouha vs. Wadi Degla.

And over in the UK we have a relegation dogfight: Fulham will make a final stand to stay in the Premier League when they play the almost-safe Burnley at 9pm.

💡 UNDER THE LAMPLIGHT-

Talk Art podcast hosts Russell Tovey and Robert Diament are out with a new book that is part-guide to an intelligent discussion about art and part-artistic celebration. The book of the same name aims to make artistic concepts and implementation accessible for everyone with chapters including ‘How to Navigate the Art World’, ‘Make Your Own Art’, and ‘How do I Create My Own Collection?’. The two hosts retain their fun and gossipy tones that made their podcast a hit in the US and UK, taking away the occasional elitism that accompanies the art scene.

🌤 TOMORROW’S WEATHER- We’re in for a (relative) respite from the past week’s sweltering heat tomorrow: Expect the mercury to dip slightly to 35°C during the day tomorrow, and 18°C at night, according to our favorite weather app.

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