Qatar shares edge higher to extend rally to third day:
"The Qatar Stock Exchange on Wednesday continued its bullish run, albeit slower, for the third day despite strong selling at the transport and insurance counters. Foreign funds turned bullish as the 20-stock Qatar Index gained by a marginal 0.09% to 9,015.15 points. Doha Bank and Masraf Al Rayan sponsored exchange traded funds QETF and QATR, nevertheless, witnessed 0.85% and 0.09% declines respectively."
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Wednesday 11 April 2018
Oil prices and Saudi Arabia’s perennial Goldilocks problem
Oil prices and Saudi Arabia’s perennial Goldilocks problem:
"Saudi Arabia faces a familiar conundrum. How does it prop up prices enough to bolster the kingdom’s economy but not so much that it backfires? As oil prices shoot above $71 a barrel, Saudi Arabia’s perennial “Goldilocks” problem is front and centre.
The previous era of oil prices above $100 a barrel helped spur investment into expensive production — from Brazil to Canada and the US. It also hurt consumer demand and drove the world towards alternative energies. A return to this scenario was seen by Saudi officials as a bad idea.
But today, the world’s largest oil exporter is undertaking the biggest economic and social reform programme in decades and it needs crude prices and revenues to help it diversify. But how much higher— $75, $80, $85 or an even greater level?"
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"Saudi Arabia faces a familiar conundrum. How does it prop up prices enough to bolster the kingdom’s economy but not so much that it backfires? As oil prices shoot above $71 a barrel, Saudi Arabia’s perennial “Goldilocks” problem is front and centre.
The previous era of oil prices above $100 a barrel helped spur investment into expensive production — from Brazil to Canada and the US. It also hurt consumer demand and drove the world towards alternative energies. A return to this scenario was seen by Saudi officials as a bad idea.
But today, the world’s largest oil exporter is undertaking the biggest economic and social reform programme in decades and it needs crude prices and revenues to help it diversify. But how much higher— $75, $80, $85 or an even greater level?"
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Oil price spikes after Houthi missiles target Saudi Arabia
Oil price spikes after Houthi missiles target Saudi Arabia:
"Saudi Arabia air defence systems intercepted two ballistic missiles fired by Yemen’s Houthi rebels at Riyadh and the southern city of Jizan in attacks that helped drive oil prices to their highest level in more than three year years.
The rockets were the latest in a series of attacks that risk escalating the more than three-year Yemeni conflict. Concerns over the missile launch and rising tension between the US and Russia over an alleged chemical attack in Syria caused Brent crude to rise by more than $2 a barrel to $73.09 on Wednesday. Brent crude, the international benchmark for oil prices, has increased by 9 per cent in the past three days.
Saudi Aramco operates a 400,000-barrel-per-day refinery in Jizan and the state oil company is leading the construction of a new economic zone on the Red Sea coast."
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"Saudi Arabia air defence systems intercepted two ballistic missiles fired by Yemen’s Houthi rebels at Riyadh and the southern city of Jizan in attacks that helped drive oil prices to their highest level in more than three year years.
The rockets were the latest in a series of attacks that risk escalating the more than three-year Yemeni conflict. Concerns over the missile launch and rising tension between the US and Russia over an alleged chemical attack in Syria caused Brent crude to rise by more than $2 a barrel to $73.09 on Wednesday. Brent crude, the international benchmark for oil prices, has increased by 9 per cent in the past three days.
Saudi Aramco operates a 400,000-barrel-per-day refinery in Jizan and the state oil company is leading the construction of a new economic zone on the Red Sea coast."
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Worst behind, UAE economy returning to growth | GulfNews.com
Worst behind, UAE economy returning to growth | GulfNews.com:
"The UAE has been resilient to the impact of the prolonged oil price slump. Following the recent rise in oil prices to over $60 (Dh220) per barrel, there is a sense that the worst is behind the UAE’s economy and confidence is gradually returning, according to Institute of International Finance (IIF). “We expect non-oil growth to pickup to 2.7 per cent in 2018 and 3 per cent in 2019, driven by private consumption and non-oil exports, as fiscal consolidation eases and global trade improves. The deceleration in headline growth last year was due to the oil production decline,” said Garbis Iradian, Chief Economist, Mena, IIF. The UAE possess large financial buffers estimated at around $800 billion (Dh2.6 trillion), safe-haven status, excellent infrastructure, and a relatively diversified business-friendly economy, which will help the country cope with lower oil prices. Further progress in diversification into non-hydro-carbon trade and financial servicesis expected to mitigate the adverse impact of lower oil prices. Non-hydrocarbon GDP accounts for only 30 per cent of total GDP, and oil exports for slightly less than 40 per cent of total exports."
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"The UAE has been resilient to the impact of the prolonged oil price slump. Following the recent rise in oil prices to over $60 (Dh220) per barrel, there is a sense that the worst is behind the UAE’s economy and confidence is gradually returning, according to Institute of International Finance (IIF). “We expect non-oil growth to pickup to 2.7 per cent in 2018 and 3 per cent in 2019, driven by private consumption and non-oil exports, as fiscal consolidation eases and global trade improves. The deceleration in headline growth last year was due to the oil production decline,” said Garbis Iradian, Chief Economist, Mena, IIF. The UAE possess large financial buffers estimated at around $800 billion (Dh2.6 trillion), safe-haven status, excellent infrastructure, and a relatively diversified business-friendly economy, which will help the country cope with lower oil prices. Further progress in diversification into non-hydro-carbon trade and financial servicesis expected to mitigate the adverse impact of lower oil prices. Non-hydrocarbon GDP accounts for only 30 per cent of total GDP, and oil exports for slightly less than 40 per cent of total exports."
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Emirates to exercise 16 Airbus A380 options "sooner rather than later" -president | ZAWYA MENA Edition
Emirates to exercise 16 Airbus A380 options "sooner rather than later" -president | ZAWYA MENA Edition:
"Emirates will exercise purchasing rights for 16 Airbus A380 jets "sooner rather than later," the airline's president said on Wednesday.
Emirates signed a preliminary agreement in January for 20 A380s and options for an additional 16. It has since finalised the agreement for the 20 A380 jets.
The Middle East airline is still deciding which engines it will purchase for those A380s, President Tim Clark told reporters in Hamburg."
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"Emirates will exercise purchasing rights for 16 Airbus A380 jets "sooner rather than later," the airline's president said on Wednesday.
Emirates signed a preliminary agreement in January for 20 A380s and options for an additional 16. It has since finalised the agreement for the 20 A380 jets.
The Middle East airline is still deciding which engines it will purchase for those A380s, President Tim Clark told reporters in Hamburg."
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MIDEAST STOCKS-Egypt surges on property merger talks, Trump tweet hits Saudi
MIDEAST STOCKS-Egypt surges on property merger talks, Trump tweet hits Saudi:
"Egyptian real estate stocks surged on Wednesday after two big companies in the sector said they might merge, while Saudi Arabia fell sharply after U.S. President Donald Trump threatened imminent military action in Syria.
In Egypt, the stock index gained 1.4 percent as SODIC jumped 5.5 percent to a 10-year closing high and Madinet Nasr for Housing and Development added 7.4 percent to a record high, although both stocks ended well off their intra-day highs.
The companies said they would start preliminary talks on strategic cooperation that might involve a merger or acquisition; EFG Hermes will advise Madinet Nasr."
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"Egyptian real estate stocks surged on Wednesday after two big companies in the sector said they might merge, while Saudi Arabia fell sharply after U.S. President Donald Trump threatened imminent military action in Syria.
In Egypt, the stock index gained 1.4 percent as SODIC jumped 5.5 percent to a 10-year closing high and Madinet Nasr for Housing and Development added 7.4 percent to a record high, although both stocks ended well off their intra-day highs.
The companies said they would start preliminary talks on strategic cooperation that might involve a merger or acquisition; EFG Hermes will advise Madinet Nasr."
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OPEC Political Crises Threaten to Double Its Million-Barrel Cut - Bloomberg
OPEC Political Crises Threaten to Double Its Million-Barrel Cut - Bloomberg:
"The deal OPEC struck in 2016 to clear a global glut by halting a significant chunk of oil production took almost a year of bargaining and brinkmanship. By year-end, the group may have lost the same amount of crude unintentionally.
The Organization of Petroleum Exporting Countries is already cutting daily production by much more than its pledged 1.2 million barrels. Venezuela’s economic crisis is battering its oil industry and pushing output to the lowest level in decades, with a further decline likely. If U.S. President Donald Trump also reimposes sanctions on Iran, the cartel’s unplanned losses could swell to double the targeted cut.
That would pose a dilemma for Saudi Arabia and Russia, the leaders of the cuts agreement. Should they let the oil market get even tighter, but run the risk that higher prices hurt demand or spur an even bigger wave of American shale-oil? Or should they fill the gap by increasing production, but in the process unravel their historic agreement prematurely?
"
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"The deal OPEC struck in 2016 to clear a global glut by halting a significant chunk of oil production took almost a year of bargaining and brinkmanship. By year-end, the group may have lost the same amount of crude unintentionally.
The Organization of Petroleum Exporting Countries is already cutting daily production by much more than its pledged 1.2 million barrels. Venezuela’s economic crisis is battering its oil industry and pushing output to the lowest level in decades, with a further decline likely. If U.S. President Donald Trump also reimposes sanctions on Iran, the cartel’s unplanned losses could swell to double the targeted cut.
That would pose a dilemma for Saudi Arabia and Russia, the leaders of the cuts agreement. Should they let the oil market get even tighter, but run the risk that higher prices hurt demand or spur an even bigger wave of American shale-oil? Or should they fill the gap by increasing production, but in the process unravel their historic agreement prematurely?
"
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Abu Dhabi Saadiyat pads need more than Louvre opening to lift prices
Abu Dhabi Saadiyat pads need more than Louvre opening to lift prices:
"Abu Dhabi’s top addresses on Saadiyat Island have shed more than a quarter of their value since 2015 new research has found. Despite the opening of the Louvre on the island in November, prices remain under pressure according to Cluttons even as the sider market shows signs of stabilization. Sea-facing villas on Saadiyat Island, which are some of the most expensive in the emirate at 1,700 dirhams ($463) per square foot, have seen no movement in prices for the past two consecutive quarters, Cluttons found."
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"Abu Dhabi’s top addresses on Saadiyat Island have shed more than a quarter of their value since 2015 new research has found. Despite the opening of the Louvre on the island in November, prices remain under pressure according to Cluttons even as the sider market shows signs of stabilization. Sea-facing villas on Saadiyat Island, which are some of the most expensive in the emirate at 1,700 dirhams ($463) per square foot, have seen no movement in prices for the past two consecutive quarters, Cluttons found."
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Iran's oil minister says $60 is a good price for crude oil
Iran's oil minister says $60 is a good price for crude oil:
"Iranian Oil Minister Bijan Zangeneh said on Wednesday that $60 a barrel is a good price for oil currently as the market should avoid volatility.
“I believe in this situation around 60 (dollars per barrel) is a good price,” said Zangeneh, who was attending the International Energy Forum.
“I think we should look at the market not for short-term, long-term, mid-term is important for us,” he said. “It is very important for producers and consumers not to have volatility in the market.”"
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"Iranian Oil Minister Bijan Zangeneh said on Wednesday that $60 a barrel is a good price for oil currently as the market should avoid volatility.
“I believe in this situation around 60 (dollars per barrel) is a good price,” said Zangeneh, who was attending the International Energy Forum.
“I think we should look at the market not for short-term, long-term, mid-term is important for us,” he said. “It is very important for producers and consumers not to have volatility in the market.”"
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Saudi Arabia happy with oil market, won't let another glut form
Saudi Arabia happy with oil market, won't let another glut form:
"Saudi Arabia’s energy minister said on Wednesday that the world’s biggest exporter of oil will not sit by and let another supply glut surface, but also does not want oil prices to rise to “unreasonable levels”.
Members of the Organization of the Petroleum Exporting Countries (OPEC) are seeking a close balance between supply and demand, Khalid al-Falih said, speaking on the sidelines of the International Energy Forum, a gathering of oil producers and consumers in New Delhi. Falih also told reporters he was happy with the current state of the oil market.
OPEC, Russia and several other non-OPEC producers began to cut supply in January 2017 in an effort to erase a global glut of crude that had built up since 2014. They have extended the pact until the end of 2018."
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"Saudi Arabia’s energy minister said on Wednesday that the world’s biggest exporter of oil will not sit by and let another supply glut surface, but also does not want oil prices to rise to “unreasonable levels”.
Members of the Organization of the Petroleum Exporting Countries (OPEC) are seeking a close balance between supply and demand, Khalid al-Falih said, speaking on the sidelines of the International Energy Forum, a gathering of oil producers and consumers in New Delhi. Falih also told reporters he was happy with the current state of the oil market.
OPEC, Russia and several other non-OPEC producers began to cut supply in January 2017 in an effort to erase a global glut of crude that had built up since 2014. They have extended the pact until the end of 2018."
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Saudi Arabia Raises $11 Billion in Biggest EM Bond of 2018 - Bloomberg
Saudi Arabia Raises $11 Billion in Biggest EM Bond of 2018 - Bloomberg:
"Saudi Arabia beat estranged neighbor Qatar to the bond market, raising $11 billion in the biggest dollar sale by an emerging-market sovereign this year. It moved quickly to sell the bonds without a roadshow, while Qatar, which is being boycotted by the kingdom and other Gulf states, is meeting investors in the U.S. and U.K. this week ahead of a possible offering. Here’s a breakdown of what Saudi Arabia sold: $4.5 billion worth of bonds due in 2025 at 140 basis points over similar-maturity U.S. Treasuries $3 billion of notes maturing in 2030 at a spread of 175 basis points $3.5 billion of 2049 bonds at 210 basis points over the similar benchmark"
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"Saudi Arabia beat estranged neighbor Qatar to the bond market, raising $11 billion in the biggest dollar sale by an emerging-market sovereign this year. It moved quickly to sell the bonds without a roadshow, while Qatar, which is being boycotted by the kingdom and other Gulf states, is meeting investors in the U.S. and U.K. this week ahead of a possible offering. Here’s a breakdown of what Saudi Arabia sold: $4.5 billion worth of bonds due in 2025 at 140 basis points over similar-maturity U.S. Treasuries $3 billion of notes maturing in 2030 at a spread of 175 basis points $3.5 billion of 2049 bonds at 210 basis points over the similar benchmark"
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Dubai's DAMAC starts marketing dollar sukuk in 6% area | ZAWYA MENA Edition
Dubai's DAMAC starts marketing dollar sukuk in 6% area | ZAWYA MENA Edition:
"Dubai real estate developer DAMAC Properties has given initial price guidance in the 6 percent area for a five-year dollar sukuk issue expected to be between $400 million and $500 million, a document from one of the banks leading the deal showed. DAMAC also announced that it had received indicative tenders of around $181 million from holders of its outstanding $650 million sukuk due 2019 that the company offered to purchase for cash. The new sukuk is expected to price later on Wednesday. "
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"Dubai real estate developer DAMAC Properties has given initial price guidance in the 6 percent area for a five-year dollar sukuk issue expected to be between $400 million and $500 million, a document from one of the banks leading the deal showed. DAMAC also announced that it had received indicative tenders of around $181 million from holders of its outstanding $650 million sukuk due 2019 that the company offered to purchase for cash. The new sukuk is expected to price later on Wednesday. "
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Qatar National Bank says Q1 net profit up 7% | ZAWYA MENA Edition
Qatar National Bank says Q1 net profit up 7% | ZAWYA MENA Edition:
"Qatar National Bank (QNB), the largest bank in the Middle East and Africa by assets, reported a 7 percent increase in first-quarter net profit, propelled by a double-digit jump in loan growth.
Net profit rose to 3.4 billion riyals ($933.9 million) for the three months to March 31.
That was broadly in line with the forecasts of two analysts polled by Reuters. SICO Bahrain forecast the bank would make a net profit of 3.4 billion riyals, while EFG Hermes had expected a net profit of 3.5 billion. "
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"Qatar National Bank (QNB), the largest bank in the Middle East and Africa by assets, reported a 7 percent increase in first-quarter net profit, propelled by a double-digit jump in loan growth.
Net profit rose to 3.4 billion riyals ($933.9 million) for the three months to March 31.
That was broadly in line with the forecasts of two analysts polled by Reuters. SICO Bahrain forecast the bank would make a net profit of 3.4 billion riyals, while EFG Hermes had expected a net profit of 3.5 billion. "
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Emirates NBD's talks to acquire Turkey's Denizbank continue, Denizbank CEO says | ZAWYA MENA Edition
Emirates NBD's talks to acquire Turkey's Denizbank continue, Denizbank CEO says | ZAWYA MENA Edition:
"Emirates NBD's talks to acquire Turkey's Denizbank continue and both sides are discussing the shareholder agreement now, Denizbank's chief executive said on Wednesday.
Hakan Ates made the comment to reporters at an event in Istanbul. He also said that all necessary transactions on the Denizbank side had been completed, without elaborating further.
Reuters reported last month that Emirates NBD could agree to buy Denizbank from Russia's Sberbank soon, after intense lobbying by Ates to convince President Tayyip Erdogan of the benefits of the potential $5.3 billion deal, despite a diplomatic rift."
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"Emirates NBD's talks to acquire Turkey's Denizbank continue and both sides are discussing the shareholder agreement now, Denizbank's chief executive said on Wednesday.
Hakan Ates made the comment to reporters at an event in Istanbul. He also said that all necessary transactions on the Denizbank side had been completed, without elaborating further.
Reuters reported last month that Emirates NBD could agree to buy Denizbank from Russia's Sberbank soon, after intense lobbying by Ates to convince President Tayyip Erdogan of the benefits of the potential $5.3 billion deal, despite a diplomatic rift."
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MIDEAST STOCKS-Gulf subdued in early trade, Dubai's Drake & Scull rebounds | ZAWYA MENA Edition
MIDEAST STOCKS-Gulf subdued in early trade, Dubai's Drake & Scull rebounds | ZAWYA MENA Edition:
"Gulf stock markets were mostly subdued in early trade on Wednesday, in line with global markets, although builder Drake & Scull (DSI) was strong in Dubai.
The Dubai index was up 0.3 percent as DSI, the most heavily traded stock, climbed 2.4 percent. It has been trading near five-month lows.
The Abu Dhabi index was flat as Abu Dhabi National Energy Co gained 2.0 percent, continuing a strong three-week uptrend."
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"Gulf stock markets were mostly subdued in early trade on Wednesday, in line with global markets, although builder Drake & Scull (DSI) was strong in Dubai.
The Dubai index was up 0.3 percent as DSI, the most heavily traded stock, climbed 2.4 percent. It has been trading near five-month lows.
The Abu Dhabi index was flat as Abu Dhabi National Energy Co gained 2.0 percent, continuing a strong three-week uptrend."
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