Most Gulf markets in red on hawkish Fed; Dubai gains | Reuters
Most stock markets in the Gulf closed lower on Thursday, mirroring global shares, after the U.S. Federal Reserve maintained its hawkish stance.
Most Gulf Cooperation Council (GCC) countries, including Saudi Arabia, the United Arab Emirates and Qatar, have their currencies pegged to the U.S. dollar and follow the Fed's policy moves closely, exposing the region to a direct impact from monetary tightening in the world's largest economy.
In Abu Dhabi, the index (.FTFADGI) fell 0.2%, hit by a 0.3% fall in conglomerate International Holding (IHC.AD).
The Abu Dhabi bourse came under pressure after the gains it recorded last month, said Farah Mourad, senior market analyst at XTB MENA.
"However, potential improvements in oil markets could provide some support and help the market move to the upside over the short term."
The Qatari index (.QSI) ended 0.3% lower, as most of its constituents were in the negative territory including Qatar Gas Transport Co (QGTS.QA), which was down 3%.
Saudi Arabia's benchmark index (.TASI) reversed early losses to finish 0.1% higher, helped by a 0.9% rise in Dr Sulaiman Al-Habib Medical Services (4013.SE).
Prices of oil, which fuels growth in Gulf economies, were little changed as the market digested tighter crude supply, alongside fears of global economic slowdown.
Dubai's main share index (.DFMGI) advanced 1%, hitting its highest since 2015, led by a 3.9% increase in top lender Emirates NBD (ENBD.DU), which is a whisker away from record high.
Foreign direct investment (FDI) flows into the UAE rose 10% in 2022 from the previous year to a record $23 billion, the United Nations trade body said in a report on Wednesday.
The UAE, the Arab world's second-biggest economy, attracted around 60% of total FDI into the six-member GCC bloc, which more than doubled to $37 billion, UNCTAD said.
Outside the Gulf, Egypt's blue-chip index (.EGX30) retreated 1.6%, extending losses for a third session.
According to Mourad, local economic conditions remained a negative factor, although they improved to a certain extent.
World Cup fever lifts Qatar Airways revenue to record high | Reuters
Qatar Airways late on Wednesday reported a record annual revenue of 76.3 billion riyals ($21 billion), underpinned by a higher customer base after the Doha-based carrier hosted the FIFA World Cup as its official partner and airline.
Net profit for the fiscal year 2022-2023 stood at 4.4 billion riyals ($1.21 billion), the company said in a statement, when the airlines carried 31.7 million passengers, a 71% jump year-on-year.
The airline recorded a load factor of 80% and yields, both the highest in the company's history.
During the World Cup, Qatar Airways operated about 14,000 flights, bringing in more than 1.4 million fans to the Arab country.
The airline could expand its number of destinations by more than 255 from 170 under plans for rapid growth, CEO Akbar Al Baker said in May, but its ability to do so depends on the delivery of additional aircraft.
Saudis Lift Some Oil Prices to Asia With Supply Cuts Prolonged - Bloomberg
Saudi Arabia lifted the pricing of its flagship crude to Asia after the key OPEC+ producer pledged this week to extend its output cuts for another month.
State-owned Saudi Aramco set the official selling price of its flagship Arab Light crude at a premium of plus $3.20 a barrel for August, according to a price list seen by Bloomberg. Almost all of the traders and refiners surveyed by Bloomberg prior to the kingdom’s announcement that it would extend supply curbs had predicted no price change.
The kingdom also lifted prices for its Arab Medium and Arab Heavy crudes to the region, while cutting those for its Super Light barrels.
Saudi Arabia’s effort to prop up the oil market will be assisted by OPEC+ ally Russia, which also pledged a reduction in exports for August, though the announcements have had a muted impact on benchmark futures. Asian buyers may look elsewhere for alternative supplies if the curbs deprive them of barrels, or if Middle Eastern cargoes are deemed expensive.
For July, Aramco hiked the prices for all of its grades to Asia after announcing a surprise production cut for the month.
Saudi Arabia will prolong into August its previously announced unilateral production cut of 1 million barrels a day. Russia will reduce exports by 500,000 barrels a day.
Aramco sells about 60% of its crude to Asia, with its biggest buyers in China, Japan, South Korea and India. The exported cargoes are mostly under long-term contracts and pricing for these barrels are reviewed each month.
Abu Dhabi's ADQ, Canada's Bank of Montreal to acquire minority stakes in Sagard | Reuters
Abu Dhabi state holding firm ADQ and Canada's Bank of Montreal plan to acquire minority equity stakes in Sagard, a global multi-strategy alternative asset management firm with $14.5 billion in assets, they said in a joint statement on Thursday.
As part of the deal, Canadian insurance-centered financial holding firm Great-West Lifeco will increase an existing minority stake, they said, helping to drive Sagard's future growth, including mergers and acquisitions.
The transaction is expected to close in the third quarter, subject to regulatory approvals. Power Corporation of Canada will remain the controlling shareholder of Sagard.
ADQ, BMO and Great-West Lifeco will also make respective commitments of additional long-term capital to Sagard’s existing and future investment strategies, strengthening fundraising potential and accelerating the firm’s ability to launch new products.
UAE attracts record $23 billion in foreign investment in 2022, UN report says | Reuters
Foreign direct investment (FDI) flows into the United Arab Emirates rose 10% in 2022 from the previous year to a record $23 billion, the United Nations trade body said in a report on Wednesday.
Globally, FDI fell 12% in the year, the United Nations Conference on Trade and Development (UNCTAD) report said in its World Investment Report 2023.
The UAE, the Arab world's second-biggest economy, attracted around 60% of total FDI into the six-member Gulf Cooperation Council (GCC) bloc, which more than doubled to $37 billion, UNCTAD said.
FDI flows into neighbouring Saudi Arabia, the region's biggest economy and the world's top crude exporter, dropped almost 60% to $7.9 billion in 2022.
The Gulf states, largely dependent on hydrocarbons for revenue, all have plans underway to diversify their economies and sources of income, and pull in foreign investment.
The UAE is among the most advanced in that process, having developed sectors such as financial services, trade and tourism as well as implementing social and business reforms.
Earlier this week, it announced the establishment of a new federal investment ministry to develop both a global and domestic strategy as it contends with growing economic competition from neighbours.
The UNCTAD report also said the UAE attracted the fourth-highest number of greenfield projects in the world last year.
The UAE is also a source of investment, with $25 billion in outward investments last year, up 10% on the previous year.
BlackRock Boosts Qatar-Owned Quintet Private Bank’s Offerings to World’s Rich - Bloomberg
BlackRock Inc. is partnering with Quintet Private Bank to bolster the Qatar-owned firm’s investment services for rich clients as it ramps up expansion plans.
BlackRock will give Quintet access to a broader range of investment products, including an exclusive set of new funds for the Luxembourg-based private bank’s clients, according to a joint statement Thursday that didn’t disclose financial terms.
Quintet, which will retain control of its investing decisions, will also have access to the New York-based firm’s risk-management platform and receive allocation advice from the world’s largest asset manager, the companies said.
“This partnership helps us serve our existing clients but also grow market share in each market we operate in,” Quintet Chief Executive Officer Chris Allen, 53, said in an interview about the agreement, which is scheduled to be completed in the third quarter.
UAE's Jaber urges Big Oil to step up its climate game | Reuters
The United Arab Emirates' incoming COP28 president urged the energy industry on Thursday to "step up its game" towards building a clean energy system.
Oil and gas firms need to achieve net-zero emissions by or before 2050 while an industry-wide commitment to reach near-zero methane emissions by 2030 needs to be accelerated, Sultan Ahmed al-Jaber told the OPEC International Seminar in Vienna, a meeting of oil industry CEOs with ministers from OPEC and allies.
"The phase down of fossil fuels is inevitable. It is in fact essential. But it cannot be irresponsible," Jaber added.
Jaber was a controversial pick to lead the United Nations COP28 climate summit because his country is an OPEC member and a major oil exporter.
He has called for an inclusive summit that brings together all stakeholders including the fossil fuel industry.
"The critical challenge of this century is to dramatically reduce emissions, while maintaining robust sustainable development," he said.
Dubai Hedge Fund Rush: Verition Joins Global Peers Millennium, ExodusPoint - Bloomberg
Verition Fund Management is opening an office in Dubai, joining industry heavyweights Millennium Management and ExodusPoint Capital Management who’ve recently expanded to the emirate.
The Greenwich, Connecticut-based firm has hired former Morgan Stanley executive Saad Mahmood to lead its outpost in Dubai’s financial district. Verition is expected to start with 15 people and plans to grow from there, according to a person with knowledge of the matter.
Dubai has emerged as a favored destination for hedge fund traders who’re drawn by its ease of doing business, tax-free status and allure as a global travel hub. The emirate’s financial center is in talks with more than 50 hedge funds about setting up operations in the city, an executive said this year.
“The opportunity to live and work in Dubai is especially appealing to our current and prospective portfolio managers,” Verition co-founder Josh Goldstein said. “The region offers a friendly time zone for traders with a global investment mandate, lower taxes, and excellent infrastructure.”
Verition, like its multi-strategy peers, relies on teams of traders to invest across asset classes. It differentiates itself by trading niche strategies with lower capacities to manage money.
The firm has grown assets to more than $7 billion from $1 billion over the past four years, and expanded staff threefold to about 400 in that period. Its multi-strategy fund has posted annualized returns of 12.5% since its launch in 2008 through May this year, according to an investor letter seen by Bloomberg.
The fund currently has offices in Greenwich, New York, London, Singapore and Hong Kong.
Most Gulf markets ease on hawkish Fed; Dubai rises | Reuters
The major stock markets in the Gulf, with the exception of Dubai, were subdued in early trading on Thursday, tracking Asian shares lower after the U.S. Federal Reserve maintained its hawkish stance.
Most Gulf Cooperation Council countries, including Saudi Arabia, the United Arab Emirates and Qatar, have their currencies pegged to the U.S. dollar and follow the Fed's policy moves closely, exposing the region to a direct impact from monetary tightening in the world's largest economy.
Saudi Arabia's benchmark index (.TASI) dropped 0.3%, on course to extend losses from the previous session, weighed down by a 0.8% fall in Al Rajhi Bank (1120.SE) and a 1.2% decline in Riyad Bank (1010.SE).
Prices of oil - a key catalyst for the Gulf's financial markets - slipped in Asian trade as fears of a sluggish demand recovery in China, the world's top crude importer, offset the prospect of tighter supply, with top exporters Saudi Arabia and Russia cutting output.
In Abu Dhabi, the index (.FTFADGI) eased 0.1%.
The Qatari index (.QSI) fell 0.1%, with Qatar Gas Transport Co (QGTS.QA) losing 1.5% and Qatar Islamic Bank (QISB.QA) retreating 0.7%.
On the other hand, Dubai's main share index (.DFMGI) advanced more than 1% to its highest since 2015, led by a 2.3% jump in top lender Emirates NBD (ENBD.DU).
Foreign direct investment (FDI) flows into the UAE rose 10% in 2022 from the previous year to a record $23 billion, the United Nations trade body said in a report on Wednesday.
The UAE, the Arab world's second-biggest economy, attracted around 60% of total FDI into the six-member Gulf Cooperation Council (GCC) bloc, which more than doubled to $37 billion, UNCTAD said.
