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Tuesday, 31 August 2021

TONIGHT: Amethis closes MENA PE fund + Global stocks hit new record highs as crude slumps; South Korean defense minister in town.

Good afternoon, wonderful people. We hope hump day has been good to you and that you’re ready for the downhill slide into the last weekend of summer.

THE BIG STORIES TODAY-

#1- Africa-focused private equity outfit Amethis has hit a USD 101 mn first close on a fund with a big earmark for Egypt. The SME-focused fund will invest in Egypt, Morocco, Tunisia and Jordan. Limited partners in the first close include a Who’s Who of DFIs with a proven interest in our part of the world as well as private investors and Edmond de Rothschild group.

#2- Upmarket real estate developer SODIC says it looks forward to resuming sales and collections at two high-profile projects “imminently” as it finalizes a new plot with the New Urban Communities Authority. The news comes after SODIC disclosed earlier this week that it would have to change the location of a 500 feddan plot in New Zayed at the request of the Housing Ministry.

^^ We’ll have chapter and verse on both stories in tomorrow’s edition of EnterpriseAM.

HAPPENING NOW- South Korean Defense Minister Suh Wook is in town and is meeting now with President Abdel Fattah El Sisi at the presidential palace, Ittihadiya said in a statement this morning. This is the first time a South Korean defense minister has visited Egypt. Suh will also hold talks with Egyptian Defense Minister Mohamed Zaki during the two-day visit.

HAPPENING ABROAD- Jury selection in the trial of Theranos founder Elizabeth Holmes is set to get underway shortly. Holmes, a university dropout who styled herself after Steve Jobs, is accused of defrauding investors. The case is to white-collar crime in the 2010s and 2020s what Enron was back at the turn of the century — and the house of cards came crashing down thanks to reporting by the Wall Street Journal’s John Carreyrou. We had a primer on the case yesterday, including a pointer to Carreyrou’s podcast if you’re following the tick-tock of the trial.

THE MARKETS TODAY-

Global stocks are ending August on a high note, notching fresh record highs amid strong corporate earnings and a sustained global recovery, Reuters reports. The MSCI world index was up 0.4% as of 3pm CLT, putting it on course for a seventh consecutive month of gains. Asian stocks rebounded after losses earlier in the day, while Wall Street futures closed at or near record highs on Monday. The USD, meanwhile, fell to a three-week low as traders embraced riskier assets.

Inflation fears in Europe: After briefly hitting fresh record highs earlier this morning, European shares fell back on higher than expected inflation data that raises the possibility that the European Central Bank could soon begin to withdraw covid stimulus. Most European indexes were in the red at the time of dispatch, with the Stoxx 600 down 0.2%, the FTSE100 losing 0.6% and the DAX down 0.4%.

The EGX has had a good month of August, with the benchmark index holding onto its gains and closing month #8 up 2.8% for the year so far.

US crude is heading towards its biggest monthly slump this year ahead of OPEC+ meeting tomorrow, where the oil cartel will weigh bringing online additional production, Bloomberg reports. The group is expected to restore some 400k barrels a day, as Hurricane Ida passes in the US and expectations that reduced demand for crude, resulting from the spread of the Delta variant, will soon pick up. WTI is down around 7% this month at USD 69 a barrel, the largest monthly loss since October of last year. Brent is currently down more than 4% from the beginning of August to under USD 73 / bbl.

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

  • CBE gives final thumbs up to Arab Investment Bank acquisition: EFG Hermes and the Sovereign Fund of Egypt (SFE) have gotten the final go-ahead from the central bank to purchase a 76% stake in the Arab Investment Bank.
  • The RIZ cometh: The Suez Canal Economic Zone will begin work on the new and improved Russian Industrial Zone (RIZ) by the beginning of next year.
  • High-speed rail: A contract will be signed in the coming days with a Siemens-led consortium to build a USD 23 bn high-speed electric rail network.

THE BIG STORY ABROAD-

As the dust clears the runway following the US withdrawal from Afghanistan, all the big papers are surveying the wreckage left behind. The thousands of foreign citizens and western Allies abandoned to the mercy of the Taliban are not the only ones wondering what might be in store. Afghanistan’s leaders are also now faced with a problem: holding on to their newfound power. While Taliban members fired rounds into the air in the streets of Kabul to celebrate the departure of the last American jet, the group’s leadership hours later called for friendly ties with the US as they attempt to establish credibility on the world stage. Meanwhile, US President Joe Biden will today address the nation on the US exit, widely seen as the greatest crisis he has faced so far in his presidency.

South Korea has set a global precedent with a challenge to Google and Apple’s payment monopolies: Google and Apple will be forced to allow apps on their stores to use alternative payment systems in South Korea under a bill passed today by the country’s lawmakers. The two maintain a stranglehold on payments made through their app stores that generate commissions worth 10s of bns of USD annually. Similar legislation has been proposed in the European Union and the US, where regulators may look to emulate the Korean example. “Korea’s decision reflects a broader trend to step up regulation of technology-platform businesses, which have been criticized for having too much power,” said one Korean business professor.

🗓 CIRCLE YOUR CALENDAR-

Tomorrow is a new month: Here are the key news triggers as we enter September:

  • PMI: August’s PMI figures for Egypt, KSA and the UAE will land on Sunday, 5 September.
  • Foreign reserves: The central bank will release foreign reserves figures for August sometime next week.
  • Inflation: Inflation data for August will drop either next week.
  • Interest rates: The Central Bank of Egypt will meet to review interest rates on Thursday, 16 September.

Egypt hosts Digi Sign Africa this week: The three-day advertising and digital printing exhibition gets underway at the Cairo International Convention Centre on Wednesday, 1 September.

Cypriot prez visiting this week: President Nicos Anastasiades arrives in Cairo on Saturday, 4 September for a joint Egypt-Cyprus summit.

ALSO- We’re a day late on this, but in our defence, we’ve never thought the guy needed to be put up for beatification. Still: Warren Buffett, the celebrity investor and self-styled Oracle of Omaha, turned 91 yesterday.

☀️ TOMORROW’S WEATHER- The temperature here is pretty much the same as yesterday — and as the whole week for that matter — with a daytime high of 39°C and overnight low of 24°C. Folks at Sahel enjoy warmer weather today, with a daytime high of 31°C and overnight low of 24°C.

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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