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Wednesday, 12 August 2015

Yuan Shock Sends Saudi Riyal Devaluation Wagers to Six-Year High - Bloomberg Business

Yuan Shock Sends Saudi Riyal Devaluation Wagers to Six-Year High - Bloomberg Business:



"A key currency indicator in Saudi Arabia rose to the highest level since 2008, indicating increased bets for a weakening of the riyal after almost 30 years fixed to the dollar.



While few expect the biggest Arab economy to abandon its peg, a backdrop of falling oil prices, declining government reserves and a devaluation in China has prompted speculation Saudi Arabia could be reconsidering the level of its exchange rate. One-year forward contracts for the riyal had the largest single-day surge since 2011 on Wednesday, after China devalued the yuan for a second day.



The jump underscores concern that oil’s 52 percent decline in the past 12 months will make it harder for the world’s largest crude exporter to sustain its exchange-rate regime as reserves drop for a fifth consecutive month and the government faces its second annual deficit. Any slowdown in Chinese demand for commodities threatens to hinder Saudi Arabia’s exports to the country, its largest trading partner."



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MIDEAST STOCKS-Bourses fall as China pressures oil and equities | Reuters

MIDEAST STOCKS-Bourses fall as China pressures oil and equities | Reuters:



"Middle East stock markets fell on
Wednesday in line with global equities that, along with
commodity prices, came under pressure from the continuing
devaluation of the Chinese yuan.



Even oil's midday rebound failed to stop the sell-off and
Egypt, which unlike Gulf states also faces pressure on its
currency, was hit the most.



The Cairo index dropped 2.1 percent, with most
stocks in the red. Non-Arab institutional investors were the
main net sellers, according to bourse data."



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MIDEAST STOCKS-Saudi, Egypt fall as China weigh on oil, emerging markets - Yahoo Maktoob News

MIDEAST STOCKS-Saudi, Egypt fall as China weigh on oil, emerging markets - Yahoo Maktoob News:



"Stock markets in Saudi Arabia and Egypt declined in early trade on Wednesday as China's decision to further devalue the yuan put pressure on commodities and emerging market equities.



Saudi Arabia's main index fell 1.5 percent and nearly all stock were in the red. Petrochemicals heavyweight Saudi Basic Industries Corp (SABIC), whose earnings are sensitive to oil prices, dropped 3.3 percent.



The sell-off also affected other sectors. The kingdom's biggest listed foodmaker, Savola Group, fell 2.6 percent and National Commercial Bank, the biggest local lender, was down 2 percent."



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Capitalism is failing, and it's time to panic – Paul Mason | Comment is Free - YouTube

Capitalism is failing, and it's time to panic – Paul Mason | Comment is Free - YouTube: ""



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China fallout, Polio success | FirstFT - YouTube

China fallout, Polio success | FirstFT - YouTube: ""



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Oil decline to ‘adversely affect’ banking sector | GulfNews.com

Oil decline to ‘adversely affect’ banking sector | GulfNews.com:



"After posting positive results in the past year, Islamic banks in the UAE and the rest of the Gulf Cooperation Council (GCC) region are likely to see profits decline in 2015 as oil revenues fall and threaten the growth of regional economies. 




According to a report published on Wednesday by Standard & Poor’s Rating Services, the “gradual weakening in economic conditions” will “adversely” affect the banking industry in the region. Growth of net income and deposits in Gulf-based Islamic banks will slow down, while asset quality is seen to deteriorate. 




Since June last year, global oil prices have been falling and a strong recovery in the near terms seems unlikely. S&P predicts that prices will remain “relatively weak through 2016”, with Brent crude forecast to average $55 per barrel in 2015, $65 in 2016 and about $75 in 2017."



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The New Oil Order: in charts - FT.com

The New Oil Order: in charts - FT.com:



"The Financial Times has been investigating what the plunge in the oil price since the summer of 2014 has meant for the industry, consumers and producers. Brent crude has more than halved since June last year, with the slide accelerating after Opec’s decision last November not to cut output, despite a US supply glut and weaker than expected demand in Asia.



The drop has inflicted massive pain on oil-exporting countries, widening budget deficits and weakening currencies. Energy companies have laid off an estimated 70,000 workers and scrapped projects worth billions of dollars, especially in high-cost areas such as Canada’s oil sands and the deepwater fields of the Gulf of Mexico.



The low oil price is reshaping the industry landscape: it drove Royal Dutch Shell’s $55bn takeover of smaller rival BG Group, and triggered the fall of Nigeria-focused oil explorer Afren, which entered administration last month. Dozens of other small oil companies are limping along, labouring under heavy debts and dwindling cash flows."



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Opec oil production rises even as Saudi Arabia reduces output - FT.com

Opec oil production rises even as Saudi Arabia reduces output - FT.com:



"Saudi Arabia scaled down its oil production from record levels last month even as rival Opec members helped push the group’s output to the highest level since 2012.



Saudi Arabia told Opec it produced 10.4m barrels a day in July, down from 10.6m b/d the month before, according to Opec’s monthly oil market report.



The kingdom’s record production in June had sparked talk that Opec’s largest member would continue increasing output as it engaged in a battle for market share against rivals."



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Yuan for the money | Short View - YouTube

Yuan for the money | Short View - YouTube: ""



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Markets bounce after bad news from China | Authers' Note - YouTube

Markets bounce after bad news from China | Authers' Note - YouTube: ""



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MIDEAST STOCKS-Gulf markets fall as China depresses oil | Reuters

MIDEAST STOCKS-Gulf markets fall as China depresses oil | Reuters:



"Most Gulf stock markets fell early on Wednesday after oil prices extended losses on the continuing devaluation of the Chinese yuan.



Dubai's index lost 0.9 percent with most stocks in the red. Blue chips Emaar Properties and Dubai Islamic Bank fell 1.0 and 1.3 percent respectively. 




Construction and engineering firm Drake and Scull dropped 2.5 percent after it reported a 60 percent decline in second-quarter profit attributable to shareholders. The company said sentiment in the sector was bearish and its margins had come under pressure because of delays on several projects."



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Abu Dhabi Sovereign Fund Unit CEO Departs, CIO Said to Leave - Bloomberg Business

Abu Dhabi Sovereign Fund Unit CEO Departs, CIO Said to Leave - Bloomberg Business:



"Nazem Al Kudsi, the chief executive officer of Abu Dhabi Investment Company, a unit of sovereign wealth fund Abu Dhabi Investment Council, has left after seven years at the firm, the company said.



Kudsi left to pursue new opportunities, according to Mohammed Al Hashemi, the executive director of asset management at the company also known as Invest AD. Khalifa Sultan Al Suwaidi, the director of direct investments at ADIC and a member of the Invest AD board, has been interim CEO since January, Hashemi said by e-mail on Monday.



Kudsi has joined Emirates International Investment Co., an Abu Dhabi-based private equity firm, according to two people familiar with the matter. EIIC didn’t respond to calls and an e-mailed request for comment. Kudsi didn’t return calls to his mobile phone."



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