Gulf Central Banks Follow Fed Move With Half-Point Rate Cuts - Bloomberg

Gulf Central Banks Follow Fed Move With Half-Point Rate Cuts - Bloomberg:

Policy makers in the Gulf followed the U.S. Federal Reserve’s emergency move on Tuesday, lowering interest rates in response to the coronavirus outbreak.

Central banks in Saudi Arabia, the United Arab Emirates and Bahrain matched the Fed’s half-percentage point cut, hours after Chairman Jerome Powell said the fallout from the virus had increased risks to the U.S. economic outlook.

Gulf central banks largely move in lockstep with the U.S. to protect their currencies’ pegs to the dollar.

• The U.A.E.’s central bank said it’s reducing the repo rate and its certificates of deposit rate by 50 basis points 
• The Saudi Arabian Monetary Authority cut the repo rate to 1.75% from 2.25% and the reverse repo rate to 1.25% from 1.75% 
• Bahrain’s central bank lowered its key rate to 1.75% from 2.25%

U.S. oil climbs, but ends off the day’s high as Fed rate cut raises worries about COVID-19’s economic fallout - MarketWatch

U.S. oil climbs, but ends off the day’s high as Fed rate cut raises worries about COVID-19’s economic fallout - MarketWatch:

U.S. benchmark oil futures finished modestly higher on Tuesday and off the day’s best levels, while global benchmark crude prices settled lower as a surprise, inter-meeting interest-rate cut by the Federal Reserve caused traders to worry more about the global economic fallout of the COVID-19 epidemic.

Prices had traded sharply higher earlier in the session, buoyed by expectations for a further cut to oil production by the Organization of the Petroleum Exporting Countries and its allies.

The Fed’s move is “a sign that the economic fall out may be worse than expected,” said Phil Flynn, senior market analyst at The Price Futures Group.

“There seems to be a lot of uncertainty, but we know that ultimately the rate cut will stabilize the market,” he told MarketWatch. “Don’t be surprised if we get a snap back later.”

April West Texas Intermediate crude CLJ20, +1.11%  rose 43 cents or 0.9%, to settle at $47.18 a barrel on the New York Mercantile Exchange. The global benchmark, May Brent crude BRNK20, +0.12%, however, moved lower to settle down 4 cents, or 0.08%, at $51.86 a barrel on ICE Futures Europe. It traded as high as $53.90 during the session.

OPEC readies knife for oil demand-slump gunfight – Breakingviews

OPEC readies knife for oil demand-slump gunfight – Breakingviews:

The 13-strong producers club that controls a third of global oil supply meets this week to try to prop up prices smashed by a coronavirus-led demand slump. Good luck with that.

The Organization of the Petroleum Exporting Countries’ chief goal when it meets in Vienna will be to soak up excess oil supply, and thus raise prices, which have fallen by 20% since January. Before the virus emerged, year-on-year demand for oil was expected to rise in the first quarter by at least 1 million barrels per day (bpd). The scale of the slowdown in China has turned that into a 200,000 bpd decline, according to consultancy Rystad Energy. It forecasts millions of barrels of spare capacity this month.

Crude prices have risen 5% this week. That’s partly because of stimulus noises from central banks, but it’s also because OPEC’s de facto leader Saudi Arabia is proposing a 1 million bpd cut on top of the 2.1 million bpd already agreed with allies like Russia in December, when concerns about a weak economy depressed prices. That would take OPEC’s estimated production for the second quarter down to around 28 million bpd, substantially below the 28.9 million bpd that was needed to balance global demand and supply in the fourth quarter.

#Kuwait beauty startup Boutiqaat in new funding talks, eyes unicorn status -sources - Reuters

Kuwait beauty startup Boutiqaat in new funding talks, eyes unicorn status -sources - Reuters:

Kuwait beauty e-commerce startup Boutiqaat is in early talks with banks to raise between $100 and $150 million in its latest funding round, tapping a burgeoning venture capital market in the Middle East, sources familiar with the deal said.

The company, whose platform offers virtual stores for Gulf and Arab celebrities and social media influencers to sell products they endorse, is fast growing and ranks as the one of most valuable technology start ups in the region.

Founded in 2015 by Kuwaiti entrepreneur Abdulwahab Alessa, Boutiqaat currently offers more than 25,000 beauty products for sale through its website and mobile apps, according to information on its website.

Last year, the company said it doubled its valuation to $500 million after a fundraising exercise, without disclosing the amount of money raised.

NMC Founder Shetty Is Said to Weigh Sale of Pharma Business - Bloomberg

NMC Founder Shetty Is Said to Weigh Sale of Pharma Business - Bloomberg:

NMC Health Plc founder Bavaguthu Raghuram Shetty is considering selling his Abu Dhabi-based pharmaceuticals business, Neopharma, after drawing interest from potential investors, according to people with knowledge of the matter.

Shetty, who resigned as chairman of the troubled hospital operator last month, has been approached by parties, including regional investors and family offices, the people said, asking not to be identified because the matter is private. Neopharma could be valued at between $700 million and $1 billion, they said.

The Indian entrepreneur, who left over concerns that he may have misreported the size of his stake in NMC, may sell all or part of Neopharma and use the proceeds to repay loans, the people said. Talks are in preliminary stages and Shetty may decide not to proceed, they said. Neopharma operates in about 50 countries in the Middle East, Africa and Asia.

A spokesman for Shetty’s BRS Ventures, which holds 30 companies including NMC and financial services firm Finablr Plc., declined to comment.

Norway Wealth Fund Cuts #Saudi Stocks During Benchmark Review - Bloomberg

Norway Wealth Fund Cuts Saudi Stocks During Benchmark Review - Bloomberg:

Norway’s $1.1 trillion sovereign wealth fund reduced holdings of Saudi Arabian equities by about 60% last year as it reviews an internal benchmark that guides its global stock purchases.

The fund’s total investment in shares traded in Riyadh fell to $420 million by the end of 2019, from about $1 billion the year before, according to data from Norges Bank Investment Management, which manages the fund. In contrast, holdings increased in other markets in the region including the United Arab Emirates, Egypt, Qatar, Kuwait, Turkey and Israel.

The Norwegian fund sold more than two-thirds of its Saudi equities last year, although the value of its holdings fell by less than that because of positive market returns, Chief Executive Officer Yngve Slyngstad said as he presented the fund’s annual report last week.

#UAE to Allow Full Foreign Ownership in 122 Activities - Bloomberg

U.A.E. to Allow Full Foreign Ownership in 122 Activities - Bloomberg:

The United Arab Emirates will allow full foreign ownership in 122 economic activities in the industrial, agricultural and services sectors.

“We have the flexibility to keep up with the economic developments and changes around the world,” Prime Minister Sheikh Mohammed Bin Rashid Al Maktoum was cited as saying by state-run WAM.

#SaudiArabia's Sabic Boosts Clariant Stake Close to One-Third - Bloomberg

Saudi Arabia's Sabic Boosts Clariant Stake Close to One-Third - Bloomberg:

Saudi Basic Industries Corp. increased its stake in Clariant AG, signaling cooling relations between the two companies hasn’t dulled the Saudi petrochemical maker’s aim to expand in specialty products through the Swiss firm. 

The state-owned plastics company now owns 31.5% in Muttenz-based Clariant, it said in a filing. That’s up from 24.99% previously and just short of the one-third ownership that would trigger a mandatory offer for the remainder. Shares of Clariant surged.

The move is part of “Sabic’s growth strategy in specialties” and furthers its aim of becoming a global leader, it said in statement, without giving further details. Completion of the transaction is subject to regulatory approvals, Sabic said. 


Spokespeople for Sabic weren’t immediately available for comment.

OPEC and allies to consider significant oil output cuts as coronavirus hits demand - Reuters

OPEC and allies to consider significant oil output cuts as coronavirus hits demand - Reuters:

OPEC and its allies will consider making substantial oil production cuts to lift prices that have been battered by the coronavirus outbreak, Algeria’s oil minister said on Tuesday, as ministers began arriving for talks in Vienna this week.

The Organization of the Petroleum Exporting Countries and allies including Russia, a group known as OPEC+, have an existing deal in place to cut output from Jan. 1 by 2.1 million barrels per day (bpd), a figure that includes additional voluntary cuts by Saudi Arabia.

But this has not been enough to counter the impact of the virus outbreak on China, the world’s biggest oil importer, and around the world, as factories are disrupted, fewer people travel and other business slows, curbing demand for oil.

The OPEC meeting, however, has been somewhat overshadowed by the coronavirus, with officials having considered whether to talks should be held in person or by video. OPEC said the number of delegates attending the meeting would be limited and journalists, who usually chase ministers, would not be allowed into OPEC headquarters.

Oil jumps after Fed cuts U.S. interest rates, then pares gains - Reuters

Oil jumps after Fed cuts U.S. interest rates, then pares gains - Reuters:

Oil prices rose on Tuesday but remained below session highs reached after the U.S. Federal Reserve cut interest rates in an emergency move designed to shield the world’s largest economy from the impact of the coronavirus.

The central bank’s statement said it was cutting rates by a half percentage point to a target range of 1.00% to 1.25%. Crude futures spiked, then pared gains as traders viewed the Fed’s move as a signal that the situation was more serious than many had thought, said Bob Yawger, director of energy futures at Mizuho in New York.

“I think the rate cut was expected to happen this week and while it adds liquidity to the market, it does little to encourage anyone to book a flight anywhere,” said Scott Shelton, an energy broker with ICAP in Durham, North Carolina. “I think the market effects are short lived when it comes to the price of oil.”

Brent crude LCOc1 was up $1.50 a barrel, or 2.7%, at $53.40 by 10:45 a.m. EST (15:45), off the session high of $53.90 a barrel hit immediately after the rate cut. U.S. West Texas Intermediate (WTI) CLc1 was up $1.49 a barrel, or 3.1%, at $48.23 a barrel, after trading as high as $48.66.

MIDEAST STOCKS-Most Gulf indexes extend gains on stimulus expectations - Reuters

MIDEAST STOCKS-Most Gulf indexes extend gains on stimulus expectations - Reuters:

Most bourses in the Middle East closed
higher on Tuesday, with Saudi outperforming the region, as
global policymakers signalled a united front to address the
economic fallout from the spreading coronavirus.

G7 finance ministers and central bank governors on Tuesday
said they would use all appropriate policy tools to achieve
strong, sustainable growth and safeguard against downside risks
from the fast-spreading coronavirus.

Saudi Arabia's benchmark index advanced 2.8%, with
all its banking shares trading in positive territory. Al Rajhi
Bank added 3.4%, while petrochemical maker Saudi Basic
Industries jumped 5.3%.

Elsewhere, Seera Group Holding was up 3.2%, after
the travel operator swung to annual profit from year ago losses.

#SaudiArabia’s Wealth Fund Parts Ways With Three Top Executives - Bloomberg

Saudi Arabia’s Wealth Fund Parts Ways With Three Top Executives - Bloomberg:

Saudi Arabia’s Public Investment Fund has parted ways with at least three senior investment executives in recent months, in what may be a blow to the sovereign wealth fund’s ambitions to expand into a global giant.

Chief Strategy Officer Dennis Johnson, who had been in his role since 2018, has left, as well as the head of risk, Martin Botha, according to people with knowledge of the matter. Head of investment risk, Hassan Chehime, who had been with the PIF for about a year, also departed, the people said, asking not to be identified because the moves haven’t been publicly disclosed. 

The $320 billion sovereign wealth fund, run by Governor Yasir Al-Rumayyan and controlled by Crown Prince Mohammed bin Salman, has been building out its bench of global and local managers as it steps up deal-making in a bid to become the world’s biggest. The departures risk stymieing those efforts as Saudi Arabia is counting on its global investments to help wean the kingdom away from its dependence on oil.

Johnson is the fund’s second head of strategy to leave in two years. Eric Ebermeyer left in 2018, just weeks after joining. Botha was one of the fund’s first senior hires in 2016.

Gulf’s Top Two Economies Dealt Setback After Virus Disruption - Bloomberg

Gulf’s Top Two Economies Dealt Setback After Virus Disruption - Bloomberg:

Business conditions in the United Arab Emirates worsened and Saudi Arabia had the weakest increase in its non-oil private sector output since at least 2009 as disruptions caused by the coronavirus rippled through the Gulf’s two biggest economies.

The spillovers into trade, tourism and supply chains resulted in “a sharp loss of momentum since the start of 2020” for Saudi Arabia, according to IHS Markit. Its Purchasing Managers’ Index for the kingdom dropped to 52.5 in February from 54.9 a month earlier, indicating the slowest pace of improvement for almost two years.

The IHS Markit U.A.E. PMI deteriorated for a second month to remain below the threshold of 50 that separates contraction from growth. “The U.A.E.’s non-oil private sector suffered another blow in February,” David Owen, Economist at IHS Markit, said in a report.

Private businesses in Saudi Arabia and the U.A.E. struggled with logistical constraints last month, which resulted in higher costs and longer lead times. IHS Markit said its latest data for Saudi Arabia showed the “sharpest lengthening” of delivery times among suppliers since the survey began over a decade ago.

India's OYO strikes multi-hotel deal with #Saudi's Al-Hokair Group - Arabianbusiness

India's OYO strikes multi-hotel deal with Saudi's Al-Hokair Group - Arabianbusiness:

OYO Homes and Hotels, India-based global hospitality major, has announced a multi-hotel partnership deal with the Al-Hokair group of Saudi Arabia, which will help the Indian group to add over 500 rooms across 3 and 4 star categories in the kingdom.

The hotels which will be managed by OYO under the agreement will include MENA Andalusia in Olaya district, Riyadh, MENA Hotel Riyadh, Olaya district, Riyadh, MENA Taif, Abu Baker Street, Taif and MENA Tabuk, Abu Jafar Al Mansur Street, Tabuk.

The four marketing and operational consulting agreements with Al-Hokair Group will help the Indian group in further consolidating and expanding its footprint in the hospitality industry in the Saudi market.

“The mid-range segment in Saudi Arabia holds a lot of promise for us given the rapid growth of the hospitality industry over the last few years,” said Manu Midha, head of Middle East and Africa, OYO.

#UAE manufacturing giant Ducab sets up new metals subsidiary - Arabianbusiness

UAE manufacturing giant Ducab sets up new metals subsidiary - Arabianbusiness:

Ducab, one of the UAE’s largest manufacturing businesses, is consolidating its metal operations into a new subsidiary.

DMB is a dedicated business unit within the Ducab Group of companies supplying Made in UAE copper and aluminium solutions, the company said in a statement. 


Ducab Aluminium Company (DAC) and Ducab Copper Rod Plant, which have over 160 employees between them, are included under the DMB umbrella.

The company said DMB exports 75 percent of its production to more than 35 countries in the wider Middle East, Africa, Asia, Europe, and the Americas. In 2019, Ducab’s copper and aluminium business generated over AED2 billion in revenue.

#Kuwait oil minister says optimistic on outcome of OPEC meetings - Reuters

Kuwait oil minister says optimistic on outcome of OPEC meetings - Reuters:

Kuwait’s oil minister said on Tuesday he is optimistic about the outcome of OPEC meetings this week and continued cooperation among OPEC+ countries, Kuwait state news agency KUNA reported.

“Marathon” meetings will be held during the OPEC and OPEC+ meetings in Vienna to reach an agreement on the best ways to restore stability and balance to the oil market, Kuwaiti minister Khaled al-Fadhel told KUNA.

#UAE's Mubadala among investors in self-driving firm Waymo - Reuters

UAE's Mubadala among investors in self-driving firm Waymo - Reuters:

Abu Dhabi state fund Mubadala Investment Co was part of a consortium that invested $2.25 billion in Waymo, the self-driving technology company owned by Alphabet Inc, it said on Tuesday.

Mubadala joined Silver Lake and other investors including the Canada Pension Plan Investment Board, Magna International, and Andreessen Horowitz in the deal, the statement said.

Founded 11 years ago as a small project inside Google, Waymo is now widely considered the leader in developing self-driving technology.

#Saudi non-oil private sector growth slowest in nearly two years - PMI - Reuters

Saudi non-oil private sector growth slowest in nearly two years - PMI - Reuters:

Saudi Arabia’s non-oil private sector expanded in February at its slowest pace in almost two years, pulled down by falling output and new orders as well as supply chain disruptions caused by the coronavirus, a survey showed on Tuesday.

The seasonally adjusted IHS Markit Saudi Arabia Purchasing Managers’ Index (PMI) fell to 52.5 in February - the slowest growth since April 2018 - from 54.9 in January. It remained above the 50.0 mark that separates expansion from contraction. 

“The latest survey data highlights a sharp loss of momentum since the start of 2020, with overall business conditions improving at the slowest pace for almost two years,” said Tim Moore, economics associate director at survey compiler IHS Markit.

#Lebanon May Ask Banks to Buy Back Bonds Sold to Foreign Funds - Bloomberg

Lebanon May Ask Banks to Buy Back Bonds Sold to Foreign Funds - Bloomberg:

Lebanese officials are considering asking local banks to buy back Eurobonds they sold to foreign funds, after the transactions gave outside creditors more leverage in a potential restructuring discussion if the government decides to default, former Finance Minister Ali Hasan Khalil said.

Khalil, who was at a meeting Monday with bankers and officials to discuss whether to repay a $1.2 billion Eurobond due next week, said that one of the ideas discussed with lenders was to have them buy back “enough” debt to regain a majority of votes in restructuring talks, according to a statement carried by Al-Akhbar newspaper.

#UAE News: Businesses Hurt by Virus; Saudi Reports 1st Case - Bloomberg

UAE News: Businesses Hurt by Virus; Saudi Reports 1st Case - Bloomberg:

The impact of coronavirus is seeping into Middle East businesses, with the outbreak weighing on exports and supply chains at the second-biggest Arab economy. 


Business conditions in the United Arab Emirates worsened in February, according to IHS Markit. Emirates Group, which runs the world’s biggest airline by international traffic and has cut flights to China, Iran and Saudi Arabia, this week encouraged staff to take leave as the outbreak saps demand for travel.

The coronavirus is spreading further in the region. Saudi Arabia, which has restricted air travel, reported its first confirmed case on Monday.

Iran, the epicenter of coronavirus in the Middle East, on Monday reported a surge in confirmed cases to over 1,500, with 66 deaths. Most cases in the Middle East are linked to Iran.

OPEC's oil cut proposal would boost price to $60 a barrel: Russia's Lukoil - Reuters

OPEC's oil cut proposal would boost price to $60 a barrel: Russia's Lukoil - Reuters:

OPEC’s proposal to cut oil production by up to 1 million barrels a day would be enough to balance the oil market and lift prices to $60 a barrel, Leonid Fedun, vice-president of Russian oil producer Lukoil, told Reuters.

The comments from Fedun, who was talking on the sidelines of the company’s presentation of its low-carbon energy strategy, suggest Russia may be willing to agree to OPEC’s proposals for more output cuts in light of the coronavirus outbreak. 

The Organization of the Petroleum Exporting Countries and its partners, a group known as OPEC+, will meet in Vienna on March 5-6 to discuss additional steps to support the oil market as the spread of the coronavirus risks hurting demand.

OPEC initially called for a cut of 600,000 barrels per day (bpd) to prop up prices, in addition to existing cuts of 1.7 million bpd which are expected to be extended when expire this at the end of this month.

Oil extends gains on expectations for coordinated effort to offset coronavirus impact - Reuters

Oil extends gains on expectations for coordinated effort to offset coronavirus impact - Reuters:

Oil prices extended gains on Tuesday on expectations that central banks will provide financial stimulus to offset the impact of the coronavirus outbreak and on growing optimism that OPEC will order deeper output cuts this week.

Brent crude LCOc1 rose $1.36 per barrel, or 2.6%, to $53.26 per barrel by 1140 GMT. U.S. West Texas Intermediate (WTI) CLc1 was up $1.48 cents, or 3.2%, at $48.23 a barrel.

Brent and WTI have rebounded somewhat over the past two days after sliding more than 20% from their January peak on signs the spread of the coronavirus had dented fuel demand.

“Oil prices recovered, in part, last week’s lost ground on the back of a general relief rally on markets, economic stimulus reassurances and expectations for petro-nations’ supply cuts,” said Saxo Bank commodity strategist Ole Hansen.

MIDEAST STOCKS-Gulf bourses gain as stimulus hopes offset virus - Agricultural Commodities - Reuters

MIDEAST STOCKS-Gulf bourses gain as stimulus hopes offset virus - Agricultural Commodities - Reuters:

Major stock markets in the Gulf opened higher on Tuesday, extending gains from the previous session, on hopes that central banks are likely to enact financial stimulus to offset the impact of the coronavirus outbreak.

G7 finance ministers and central bank governors will hold a conference call on Tuesday morning to discuss measures to deal with the widening coronavirus outbreak and its economic impact, a U.S. Treasury spokeswoman said on Monday. 


The European Central Bank on Monday joined the chorus of central banks signalling a readiness to deal with the growing threats from the outbreak.

Saudi Arabia’s benchmark index gained 2.2%. Al Rajhi Bank increased 2.5% and petrochemical maker Saudi Basic Industries traded 3% up.