Aramco, Lebanon, Gulf Oil: A Guide to Middle East Risks in 2020 - Bloomberg:
If 2019 was the year when a clutch of Middle East markets burst into the mainstream, then 2020 will test whether the foreign money keeps flooding in.
The year opened with five Gulf Arab economies joining JPMorgan Chase & Co.’s emerging-market bond indexes. The spotlight stayed firmly on the region as Saudi Aramco’s $12 billion international bond $12 Billion of Bonds in Unprecedented Debut (1)" target="_blank">debut in April was followed by preparations for its historic public offering at the end of the year. Gulf dollar bonds outperformed their emerging-market peers with returns of 14% this year.
At the same time, drone and missile strikes on Aramco’s facilities in September served as a reminder of the region’s political fault-lines and the potential pitfalls investors face.
“Geopolitical disruption risk has not disappeared,” Citigroup Inc. analysts including Edward Morse wrote in an emailed note. The headwinds have been “heavily discounted by markets, which look to us to be more vulnerable to disruption” than before the Aramco attack, they said.
If 2019 was the year when a clutch of Middle East markets burst into the mainstream, then 2020 will test whether the foreign money keeps flooding in.
The year opened with five Gulf Arab economies joining JPMorgan Chase & Co.’s emerging-market bond indexes. The spotlight stayed firmly on the region as Saudi Aramco’s $12 billion international bond $12 Billion of Bonds in Unprecedented Debut (1)" target="_blank">debut in April was followed by preparations for its historic public offering at the end of the year. Gulf dollar bonds outperformed their emerging-market peers with returns of 14% this year.
“Geopolitical disruption risk has not disappeared,” Citigroup Inc. analysts including Edward Morse wrote in an emailed note. The headwinds have been “heavily discounted by markets, which look to us to be more vulnerable to disruption” than before the Aramco attack, they said.
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