Emerging-market currencies poised for selloff amid possible US yield spike? Developing-nation currencies may suffer losses amid a possible sharp rise in US real yields as inflation rises and the mitigating effects of China's economic rebound fade, according to Bloomberg. Emerging-market currencies saw their biggest losses since July 9 as the two-year yield jumped last week, while the benchmark gauge for emerging-market currencies has fallen about 2% from a record in June and is close to wiping out its gains this year. EM currencies could see their losses deepen further if key economic indicators — including China’s industrial production and South African consumer prices — point to a worsening macroeconomic forecast.

US and European banks make rebound the theme of the quarter amid stellar earnings: Most banks in the United States and United Kingdom have taken back reserves they set aside last year for pandemic-related operational risks — ditto European banks — as their second-quarter investment banking revenues skyrocketed to outstrip pre-pandemic levels, driven by a flurry of M&A and capital markets activity, the Financial Times reports. Reduced loan loss provisions, as well as fewer than expected defaults thanks to government stimulus programs also buoyed the positive earnings, and put banks on track to weather the long term economic effects of covid-19.

Ethiopian banks were over the weekend ordered to temporarily suspend lending on loans backed by collateral, after authorities suspected the money was being used on the black market, Bloomberg reports. The national bank directive comes amid a civil war in Ethiopia’s northern region, and after inflation rates reached a decade-high of 24.6%.

If you squint right, a US bill may just have made crypto legit: The crypto market soared over the weekend despite the US Senate’s passing of an infrastructure bill last week that would impose broad oversight of the sector through tax reporting rules, Bloomberg reports. Analysts noted that the passing of the bill may have sent the signal that crypto is here to stay as a part of the financial system, calling the legislation “a legitimizing event.”

Aramco will join forces with ACWA power to build a USD 1 bn solar power plant in Saudi Arabia: Dubbed the Sudair solar project, the plant will be the largest in Saudi Arabia when it starts production in 2H2022.

THE CLOSING BELL-

The EGX30 rose 1.3% at yesterday’s close on turnover of EGP 1.55 bn (14.2% above the 90-day average). Local investors were net sellers. The index is up 1.7% YTD.

In the green: Speed Medical (+4.6%), Egypt Kuwait Holding (+4.4%), and CIB (+3.0%).

In the red: Raya Holding (-2.5%), TMG Holding (-2.4%), and Medinet Nasr Holding (-2.2%).

Asian markets are, with the exception of Shanghai, in the red this morning, with futures suggesting leading indexes in Europe and on Wall Street are going to follow suit later today.