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Sunday, 8 August 2021

A more diverse Nasdaq and a sooner-than-expected Fed hike?

Fed could hike rates in early 2023: The Federal Reserve could move to raise interest rates from historic lows by early 2023 should the economy maintain current momentum, the central bank’s vice chair Richard Clarida said last week, according to the Wall Street Journal. Last September, the central bank pledged to maintain ultra-low interest rates until the economy reaches near maximum employment and inflation “moderately exceeds” 2% for “some time,” two targets Clarida expects to be met by the end of 2022.

We could soon see more diverse boards for Nasdaq-listed companies after the US’ Securities and Exchange Commission gave the all-clear for the exchange operator’s plan to include gender, race and orientation in its listing rules. Under the proposal, Nasdaq would require its companies to have at least one or two “diverse” board members, including one woman and one member of an “underrepresented” minority group, or explain in writing why they do not. A company that does not want to meet diversity objectives nor explain why “may transfer its listing to a competing listing exchange,” though the proposal also provides flexibility and time for businesses to explain themselves, the SEC says. The Financial Times and Bloomberg also have the story.

Aramco may have to hike its USD 75 bn dividend — already the highest in the world — to keep up with competitors, Bank of America Analysts said in a research note seen by Bloomberg, ahead of the expected release of the oil giant’s 2Q2021 earnings today. Shell, BP, and others recently upped their dividends to lure back wary investors to the fossil fuel industry. But Aramco has struggled to meet its investor obligations, and took to debt markets earlier this to raise USD 6 bn in order to fund dividend payouts. However, surging oil prices as demand rebounds from the covid slump could give the company better cash flow in the current quarter.

Huawei witnessed its biggest ever revenue drop off the back of US tech sanctions with the company’s earnings plummeting by 29% y-o-y, the Financial Times reports. A decline in smartphone sales was largely the culprit, with revenues in that line of business falling by 47% as US sanctions against local companies supplying parts to Huawei limited the supply of key items.

None EGX30 10,723 -% (YTD: -1.1%)
Up USD (CBE) Buy 15.64 Sell 15.77
None USD at CIB Buy 15.65 Sell 15.75
None Interest rates CBE 8.25% deposit 9.25% lending
Up Tadawul 11,209 +0.4% (YTD: +29.0%)
Up ADX 7,419 +0.2% (YTD: +47.1%)
Up DFM 2,820 +0.3% (YTD: +13.2%)
Up S&P 500 4,436 +0.2% (YTD: +18.1%)
None FTSE 100 7,122 -% (YTD: +10.3%)
Down Brent crude USD 70.70 -0.8%
None Natural gas (Nymex) USD 4.14 -%
Down Gold USD 1,763.10 -2.5%
Up BTC USD 43,139.95 +3.39% (as of midnight)


The EGX30 rose less than 0.1% during Thursday’s trading session on turnover of EGP 1.6 bn (21.9% above the 90-day average). Local investors were net buyers. The index is down 1.1% YTD.

In the green: Cleopatra Hospital (+2.9%), Alexandria Mineral Oils Company (+2.4%) and Qalaa Holdings (+2.3%).

In the red: Ezz Steel (-2.6%), Eastern Company (-1.9%) and Rameda Pharma (-1.0%).

Enterprise is a daily publication of Enterprise Ventures LLC, an Egyptian limited liability company (commercial register 83594), and a subsidiary of Inktank Communications. Summaries are intended for guidance only and are provided on an as-is basis; kindly refer to the source article in its original language prior to undertaking any action. Neither Enterprise Ventures nor its staff assume any responsibility or liability for the accuracy of the information contained in this publication, whether in the form of summaries or analysis. © 2022 Enterprise Ventures LLC.

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