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Monday, 7 June 2021

What the markets are doing on 7 June 2021

Some foreign investors are starting to reposition their EM portfolios in anticipation of an end to US stimulus measures. Some emerging-market investors are trying to reduce their exposure to a rise in US interest rates as speculation builds that the Federal Reserve may begin tapering its bond-buying programme, Bloomberg reports. Bank of America is telling investors to buy into EM EUR-denominated bonds while some funds are going in search of EM bonds that are less sensitive to rising US rates. Others are looking towards equities, which are seen by some as being less vulnerable to moves in the US treasury market.

Yellen just said exactly what EM central bankers don’t want to hear, calling a higher interest rate environment in the US a “a plus” during an interview with Bloomberg. The Treasury Secretary and former Fed chair said that the central bank wants interest rates to return to a normal level, having been ultra-low for much of the last decade.

Up

EGX30

10,122

+0.7% (YTD: -6.7%)

None

USD (CBE)

Buy 15.64

Sell 15.74

None

USD at CIB

Buy 15.64

Sell 15.74

None

Interest rates CBE

8.25% deposit

9.25% lending

Down

Tadawul

10,685

-0.1% (YTD: +23.0%)

Up

ADX

6,623

+0.3% (YTD: +31.3%)

Down

DFM

2,820

-0.1% (YTD: +13.2%)

Up

S&P 500

4,229

+0.9% (YTD: +12.6%)

Up

FTSE 100

7,069

+0.1% (YTD: +9.4%)

Down

Brent crude

USD 71.79

-0.1%

None

Natural gas (Nymex)

USD 3.10

-%

Up

Gold

USD 1,893.50

+0.1%

Up

BTC

USD 35,916

+2.2% (as of midnight)

The EGX30 rose 0.7% at today’s close on turnover of EGP 1.27 bn (2.2% below the 90-day average). Local investors were net buyers. The index is down 6.7% YTD.

In the green: Pioneers Holding (+7.1%), MM Group (+4.9%) and Cleopatra Hospital (+4.7%).

In the red: Fawry (-2.9%), Abu Qir Fertilizers (-1.4%) and Telecom Egypt (-1.0%).

Asian markets are slightly down in early trading this morning. European and US equities look set to follow them later today, according to the futures markets.

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