Weekly Market Review - Mashreq Bank · Exports in Oct rose 9.6% YoY, faster than 6.9% YoY growth in Sept. Total imports rose 2.7% YoY in Oct HSBC/Markit flash China manufacturing

Weekly Market Review November 16, 2014 – November 22, 2014

November 23, 2014

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CONTENTS

International Equity Markets

GCC Equities

Currencies

Commodities

Interest Rates

Equity Markets - Top Most & Bottom Most

Commodity Markets - Top Most & Bottom Most

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US Fed Oct 28-29 meeting minutes revealed that Fed officials agreed to keep the market-friendly language on short term interest rates but added that Fed moves would depend on the pace of job growth and inflation

US core CPI rose 1.8% YoY in Oct, after rising 1.7% YoY in Sept. MoM, core CPI rose 0.2% in Oct from 0.1% in Sept

Existing home sales rose 1.5% to an annual rate of 5.26mn units, highest since Sept 2013

Homebuilder sentiment rose as NAHB/Wells Fargo Housing Market index advanced to 58 from 54 in Oct

Flash US manufacturing PMI from Markit fell to 54.7 in Nov from 55.9 in Oct

Factory production increased 0.2% in October. September’s figure was revised down to 0.2% from 0.5%

Markit’s composite Euro zone PMI came below forecasts at 51.4 in Nov. Composite new orders index fell to 49.9

Flash estimate showed Euro zone consumer confidence fell to -11.6 in Nov from -11.1 in Oct

Markit’s composite PMI for France stood at 48.4 in November, just up from October's eight-month low of 48.2

British inflation edged up in Oct to 1.3% YoY from 1.2% YoY rise in Sept. Core inflation held steady at 1.5% in Oct

Japan’s GDP shrank by an annualized 1.6% in 3Q2014, after plunging 7.3% in 2Q2014, post the sales tax hike

Exports in Oct rose 9.6% YoY, faster than 6.9% YoY growth in Sept. Total imports rose 2.7% YoY in Oct

HSBC/Markit flash China manufacturing PMI fell to a six-month low of 50 in November from 50.4 in October

Home prices slumped 2.6% YoY in Oct, despite government support. FDI fell 1.2% in Jan-Oct 2014

Australia and China witnessed 14 commercial agreements worth around $18bn, post the signing of a FTA

Paris-based OECD raised 2015-16 growth forecast for India from 5.7% to 6.6%. Growth for 2016-17 was forecasted at 6.8%. Inflation was expected to slow down from 6.9% in 2014-15 to 5.4% in 2015-16

Brazil’s 2014 budget surplus goal cut from 2.15% to 0.19% of GDP. 2015 economy growth target cut from 3% to 2%

Mexico cuts 2014 growth forecast from 2.7% to 2.1-2.6% after GDP growth slowed from 0.9% in 2Q2014 to 0.5% QoQ in 3Q2014

S&P 500 – 1 year performance Euro Stoxx 600 – 1 year performance

Source: Bloomberg, Mashreq Private Banking

INTERNATIONAL EQUITY MARKETS

Last Close Change 5 Day % YTD %

S&P 500 2,063.50 23.68 1.16 11.64

DJI 17,810.06 175.32 0.99 7.44

Nasdaq Comp 4,712.97 24.43 0.52 12.84

Euro Stoxx 600 345.24 9.61 2.86 5.17

FTSE 100 6,750.76 96.39 1.45 0.02

Dax 9,732.55 479.61 5.18 1.89

CAC 40 4,347.23 144.77 3.44 1.19

Nikkei 225 17,357.51 -133.32 -0.76 6.54

Hang Seng 23,437.12 -650.26 -2.70 0.56

Brazil - Bovespa 56,084.04 4,311.64 8.33 8.89

Russia - Micex 1,538.93 38.17 2.54 2.32

BSE Sensex 28,334.63 287.97 1.03 33.84

Shanghai Comp 2,486.79 7.97 0.32 17.52


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Emirates NBD, First Gulf Bank, Mashreq bank and Union National Bank took part in the fund-raising of Singapore’s Mercuria Energy Group’s AED3.67bn credit facility

SPF Realty partners with G&Co for Millennium Square residential community project worth AED2.8bn

Dubai Festival City, owned by Al-Futtaim Group, is seeking a $1.1bn loan to repay debt and help fund expansion

Arkan Building Materials opened AED1.3bn Al Ain cement factory, increasing capacity to 5.6mn from 4.5mn tons

FlyDubai raised $500mn from the sale of its debut five-year Sukuk

Aramex signed a JV deal with Thailand-based Leo Global Logistic to form Aramex Thailand

Moody’s affirmed DP World’s Long-term Issuer rating at ‘Baa3’ with a Stable outlook

Fitch Ratings affirmed creditworthiness of Ras Al Khaimah at ‘A’ with a Stable outlook

Drake & Scull International issued $120mn unrated senior unsecured 5-yr certificates by way of private placement

Dubai World closes in on a deal to extend repayment of $10.5bn of borrowings until 2022

Saudi Arabia-based Fawaz Alhokair Group plans to raise $2bn from the IPO of its Arabian Centres malls unit

Saudi Kayan Petrochemical Co. signed two Islamic financing deals totaling SR2.63bn with NCB and Samba group

Saudi Hotels and Resorts changed its name to DUR Hospitality Company, plans to invest SR1.5bn for expansion

Saudi Arabia is considering to allow FIIs to begin direct trading of Saudi Arabian stocks before April 2015

Fitch ratings affirmed Long-term Issuer Default Ratings of 9 Kuwaiti banks with a Stable outlook

Moody’s affirmed Kuwait Finance House’ Bank Financial Strength Rating with a Negative outlook

Qatar-based Barwa bank reported a 56% increase in 3Q2014 net profit to QR220mn

Bahrain-based Gulf Finance House reduced its capital from $972.3mn to $837.9mn to cut its accumulated losses

AM Best affirmed Bahrain Kuwait Insurance Co’s Financial Strength and Issuer Credit rating with Stable outlook

Bahrain’s Arcapita Bank raised $100mn from shareholders to fund a return to deal-making activities


Dubai 4,563.39 -93.90 -2.02 35.42

Abu Dhabi 4,957.79 4.43 0.09 15.56

Saudi Tadawul 9,408.83 -272.83 -2.82 10.23

Qatar Index 13,846.01 116.23 0.85 33.40

Kuwait Index 6,985.89 -215.37 -2.99 -7.47

Oman MSM 30 7,078.72 65.27 0.93 3.57

Bahrain All

Share 1,441.24 10.93 0.76 15.40

Egypt EGX 30 9,258.18 -2.00 -0.02 36.49

Istanbul 100

Index 83,281.80 2,070.25 2.55 22.83


DFMGI – 1 year performance Saudi Tadawul – 1 year performance

GCC EQUITIES


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The yen lost 0.22% in the week against the euro, registering a 6th week of fall. It closed at 145.99 per euro, as the Bank of Japan warned inflation may slip below 1% before a consumer prices report due on Nov 27

The dollar appreciated 1.07% in the week to 1.2391 per Euro after European Central Bank chief Mario Draghi said inflation expectations were declining to levels that were very low, keeping the door open for further monetary easing soon

The Canadian dollar climbed 0.5% in the week to 1.1233 per US dollar after inflation rose faster than all economists’ forecasts in October, boosting speculation the Bank of Canada will signal it’s closer to raising interest rates

Brazil’s real gained 3.3% in the week to 2.5158 per dollar, on speculation that President Dilma Rousseff is close to nominating a team capable of reviving Latin America’s largest economy

The Russian ruble rallied 3.12% in the week to close at 45.8345 per dollar as oil futures gained for the first time in nine weeks

Indonesia’s rupiah completed its first weekly gain in a month and appreciated 0.55% to 12,147 per dollar after President Joko Widodo cut fuel subsidies and the central bank raised interest rates to soften the inflationary impact


EUR/USD 1.2391 -0.0134 -1.07 -9.84

GBP/USD 1.5656 -0.0013 -0.08 -5.44

AUD/USD 0.8670 -0.0080 -0.91 -2.77

USD/JPY 117.7900 1.5000 1.29 11.85

USD/CHF 0.9697 0.0106 1.11 8.60

USD/CAD 1.1233 -0.0054 -0.48 5.74

USD/BRl 2.5158 -0.0858 -3.30 6.51

USD/RUB 45.8345 -1.4765 -3.12 39.44

USD/INR 61.7750 0.0537 0.09 -0.04

USD/CNY 6.1248 -0.0052 -0.08 1.16

DXY Index 88.3100 0.7850 0.90 10.34

EUR/USD – 1 year performance GBP/USD – 1 year performance


CURRENCIES


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WTI rose 0.9% and Brent gained 1.2% in the week after the People’s Bank of China lowered lending and deposit rates for the first time since 2012, leading to the perception that fuel demand will gain

Gold and silver appreciated 1.1% and 0.8% in the week after a surprise rate cut by China boosted demand for precious metals as a store of value. Meanwhile, IMF data showed that Russia added to its gold reserves in Oct, bringing holdings to the highest in at least two decades

Soybean futures were up 1.76% in the week on speculation that increased stimulus from Japan, Euro zone and China will spur economic growth and food demand

Nickel futures advanced 6.7% in the week after Indonesia, the largest producer of mined nickel ore, reaffirmed its ore export ban and data showed that global surplus has narrowed from last year

Orange-juice futures surged 10.1% in the past week as bone-chilling weather swept through parts of the US, sparking worries that freezing temperatures could damage Florida’s orange crop this winter


Gold spot 1,201.55 12.80 1.08 -0.34

Silver spot 16.44 0.13 0.80 -15.56

Copper-CMX 302.90 -0.95 -0.31 -9.61

Brent - ICE 80.36 0.95 1.20 -24.11

WTI - Nymex 76.51 0.69 0.91 -16.78

S&P GSCI Spot

Index 525.20 4.23 0.81 -16.94

Baltic Dry Index 1,324.00 68.00 5.41 -41.85

WTI Crude – 1 year performance GOLD – 1 year performance


COMMODITIES


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US 10-year treasuries rose and yield declined 1.0 bps in the week to 2.31% as inflation below the Federal Reserve’s goal boosted speculation that policy makers won’t be in a hurry to raise interest rates in 2015

UK 10-year bonds advanced and yield fell 6.8 bps in the week to 2.05% as a report showed inflation stayed near the lowest level in five years, adding to speculation that monetary policy makers have no case to raise interest rates soon

Italy’s 10-year yield fell 13 bps in the week to 2.21% amid speculation the European Central Bank will broaden its asset purchases to buy sovereign debt

Spain’s 10-year yield declined 11 bps in the week to 2.01%, the lowest on record, as data showed a slowdown in manufacturing and services output in the Euro zone

Austrian and French 10-year rates dropped to record lows, as ECB President Mario Draghi said that policy makers would be willing to widen the scope of the central bank’s purchases should the inflation outlook for the region diminish. Austrian 10-yr yield fell 2 bps to 0.94% while French 10-yr yield was down 2.8 bps to 1.1% in the week

The People's Bank of China cut its one-year benchmark lending rates by 40 bps to 5.6% and lowered one-year benchmark deposit rates by 25 bps to 2.75%, effective Nov 22, to support growth and ease debt pressure

India’s benchmark 10-year bond yield fell 5 bps in the week to 8.17% , largely on optimism that easing consumer inflation would spur easier monetary policy


USD-1w Libor 0.13 0.0055 4.57 -2.75

USD-3m Libor 0.23 0.0008 0.32 -5.38

USD-6m Libor 0.33 0.0005 0.15 -6.06

USD-10yr 2.31 -0.0105 -0.45 -23.72

AED-1m EIBOR 0.38 0.0014 0.38 -17.08

AED-3m EIBOR 0.68 0.0000 0.00 -15.82

AED-12m EIBOR 1.02 0.0000 0.00 -14.23

UK-10yr 2.05 -0.0680 -3.21 -32.23

Japan-10yr 0.46 -0.0220 -4.60 -37.96

US 10 year Generic Yield – 1 year performance UK 10 year Generic Yield – 1 year performance


INTEREST RATES


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Ref Country Weekly Change Weekly Change

(USD Adj.)

1 Nigeria -4.11% -7.12%

2 Kuwait -2.99% -2.96%

3 Saudi Arabia -2.82% -2.81%

4 Mongolia -2.77% -3.22%

5 Hong Kong -2.70% -2.75%

6 Morocco -2.50% -3.54%

7 Vietnam -2.05% -2.28%

8 Dubai−UAE -2.02% -2.02%

9 Bulgaria -1.84% -2.89%

10 Kazakhstan -1.57% -1.59%

Ref Country Weekly Change Weekly Change

(USD Adj.)

1 Greece 11.71% 10.52%

2 Brazil 8.33% 12.02%

3 Russia 5.84% 5.84%

4 Italy 5.22% 4.09%

5 Germany 5.18% 4.06%

6 Ireland 4.76% 3.64%

7 Austria 4.02% 2.90%

8 Luxembourg 3.93% 2.82%

9 Finland 3.74% 2.63%

10 Spain 3.67% 2.56%

WEEKLY

Ref Country YTD Change YTD Change (USD Adj.)

1 Argentina 85.06% 41.68%

2 Egypt 36.49% 32.59%

3 Dubai−UAE 35.42% 35.41%

4 India 33.84% 33.89%

5 Qatar 33.40% 33.38%

6 Sri Lanka 25.18% 24.91%

7 Pakistan 24.68% 29.21%

8 Slovenia 24.53% 12.28%

9 Philippine 23.54% 21.85%

10 Serbia 23.53% 6.22%

YTD

Ref Country YTD Change YTD Change (USD Adj.)

1 Russia -26.61% -26.61%

2 Portugal -18.84% -26.83%

3 Nigeria -17.91% -25.74%

4 Greece -14.42% -22.84%

5 Cyprus -11.17% -19.91%

6 Malta -10.83% -19.60%

7 Austria -10.56% -19.36%

8 Mongolia -9.00% -19.66%

9 Latvia -7.95% -17.01%

10 Kuwait -7.47% -10.39%

EQUITY MARKETS - TOP MOST & BOTTOM MOST


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Ref Commodity Weekly Change

1 Corn -2.36%

2 Wheat -2.36%

3 Lean Hogs -2.19%

4 Steel Rebar -2.00%

5 Feeder Cattle -1.52%

6 Coffee -1.22%

7 Copper -0.49%

8 Heat Oil -0.48%

9 Bean Meal -0.39%

10 Cotton -0.07%

Ref Commodity Weekly Change

1 Orange Juice 10.11%

2 Rough Rice 7.37%

3 Nickel 6.71%

4 Natural Gas 6.12%

5 Lumber 4.91%

6 Tin 4.18%

7 Palladium 3.31%

8 Ethanol 1.98%

9 Soybeans 1.76%

10 Zinc 1.73%

WEEKLY

Ref Commodity YTD Pct Change

1 Coffee 71.32%

2 Feeder Cattle 41.78%

3 Live Cattle 27.06%

4 Nickel 19.60%

5 Aluminium 14.12%

6 Zinc 12.12%

7 Palladium 10.66%

8 Ethanol 7.80%

9 Lean Hogs 6.12%

10 Cocoa 5.83%

YTD

Ref Commodity YTD Pct Change

1 Rubber -31.92%

2 Cotton -29.40%

3 Brent Crude -27.47%

4 Gasoline -26.18%

5 Gasoil -25.42%

6 Steel Rebar -22.34%

7 WTI Crude -22.26%

8 Heat Oil -21.86%

9 Soybeans -20.84%

10 Rough Rice -18.79%

COMMODITY MARKETS - TOP MOST & BOTTOM MOST


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IMPORTANT NOTICE

This report was prepared by the Private Banking Unit of Mashreqbank psc (“Mashreq”) in the United Arab Emirates (“U.A.E.”). Mashreq is regulated by the Central Bank of the U.A.E. This report is provided for informational purposes and private circulation only and should not be construed as an offer to sell or a solicitation to buy any security or any other financial instrument or adopt any hedging, trading or investment strategy. Prior to investing in any product, we recommend that you consult with a professional financial advisor, taking into consideration investment objectives, financial circumstances and tax implication. While based on information believed to be reliable, we do not guarantee and make no express or implied representation as to the accuracy of this report or complete description of the securities markets or developments referred to in this report. The information, opinions, forecasts (if any), assumptions or estimates contained in this report are as of the date indicated and are subject to change at any time without prior notice. The stated price of any securities mentioned in this report is as of the date indicated and is not a representation that any transaction can be effected at this price. The risks related to investment products described in this report are not all encompassing and investors should refer to the relevant investment offer document for detailed information and applicable terms and conditions. Investment products, including treasury products, are not guaranteed by Mashreq or any of its affiliates or subsidiaries unless stated otherwise and are subject to investment risk, including loss of principal. Investment products are not government insured. Past performance is not an indicator of future performance. US persons (US Citizens; US Green Card Holders; Resident Aliens subject to US income taxes for IRS purposes) are not eligible for any of the investment products introduced by Mashreq unless stated otherwise. This report is for distribution only under such circumstances as may be permitted by applicable law. Neither Mashreq nor its officers, directors or shareholders or other persons shall be liable for any direct, indirect, incidental or other damages including loss of profits arising in any way from the information contained in this report. This report is intended solely for the use by the intended recipients and the contents shall not be reproduced, redistributed or copied in whole or in part for any purpose without Mashreq’s prior express consent.

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Weekly Market Review - Mashreq Bank · Exports in Oct rose 9.6% YoY, faster than 6.9% YoY growth in Sept. Total imports rose 2.7% YoY in Oct HSBC/Markit flash China manufacturing