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Monday, 24 May 2021

Oil is having a bad week off of Iran’s potential reentry to the market

Oil posts worst weekly losses on Iran nuclear agreement progress: Oil prices suffered their biggest weekly losses in over a month, with the prospect of a supply glut following the lifting of US sanctions and the return of Iranian crude supplies weighing on prices, Bloomberg reports. Rising inflation concerns and the continued impact of covid-19 on demand have been compounded by the prospect of Iran almost doubling its 2.4 mn bbl / d output in April to its pre-sanctions level of 4 mn barrels a day within three months, if US sanctions are lifted. The market is more prepared to absorb the additional supply in 4Q2021 but an earlier increase in supply “could hurt third-quarter balances,” said a Deutsche Bank analyst. Iran is expected to extend its nuclear inspections agreement with the International Atomic Energy Agency ahead of a fifth round of multilateral talks in Vienna that the country hopes will lead to the US rejoining the 2015 nuclear accord and the removal of Trump-era sanctions.

US claims victory over China in Ethiopia's USD multi-bn telecom project: A US-backed consortium led by Vodafone was awarded contracts to build a 5G-equipped wireless network in Ethiopia, beating out MTN Group’s rival bid, which was partially financed by China’s Silk Road Fund, the Wall Street Journal reports. “The US and China are fighting a proxy war in Ethiopia for influence,” said Zemedeneh Negatu, the chairman of Africa-focused US investment firm Fairfax Africa Fund. The competition over the contract was particularly significant as the US and China increasingly vie over future tech pursuits covering everything from 5G rollout to chip manufacturing.

Up

EGX30

10,812

+0.8% (YTD: -0.3%)

Down

USD (CBE)

Buy 15.62

Sell 15.71

Down

USD at CIB

Buy 15.62

Sell 15.72

None

Interest rates CBE

8.25% deposit

9.25% lending

None

Tadawul

10,343

– (YTD: +19.0%)

Up

ADX

6,546

+0.4% (YTD: +29.8%)

Up

DFM

2,786

+1.3% (YTD: +11.8%)

Down

S&P 500

4,155

-0.1% (YTD: +10.6%)

None

FTSE 100

7,018

– (YTD: +8.6%)

Up

Brent crude

USD 66.72

+0.4%

Down

Natural gas (Nymex)

USD 2.86

-1.7%

Up

Gold

USD 1,887.40

+0.5%

Down

BTC

USD 35,068.43

-7.9%

The EGX30 rose 0.75% yesterday on turnover of EGP 1.29 bn (2.2% above the 90-day average). Foreign investors were net sellers. The index is down 0.35% YTD.

In the green: ElSewedy Electric (+4.8%), Heliopolis Housing (+3.3%) and Sodic (+1.9%).

In the red: Edita (-3.7%), Oriental Weavers (-1.9%) and Abu Qir Fertilizers (-1.4%).

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