Saudi Arabia Public Investment Fund Reports $11 Billion Investment Loss for 2022 - Bloomberg
Saudi Arabia’s Public Investment Fund reported a loss on investment activities of about $11 billion last year compared to a profit of $19 billion in 2021 as global markets sank.
That meant the fund’s loss attributable to its owner was 36.6 billion riyals ($9.8 billion) in 2021, down from a profit of 81.8 billion riyals, according to the wealth fund’s accounts published Tuesday. Total assets of the PIF, as the fund is known, rose to about $778 billion from $676 billion.
PIF said it made a 25% return in 2021 as global markets rallied, roughly in line with that of investors in the S&P 500 Index that year. PIF didn’t disclose a comparable figure in its 2022 accounts, a year when the S&P dropped almost 20%. The index is up about 15% so far this year.
The PIF is in the midst of a global investment spree after it was transformed from a domestically-focused holding company into a sovereign fund in 2016. In recent months it has grabbed global attention for a deal to merge its upstart LIV golf tournament with the PGA, part of a push by the kingdom to boost its soft power and improve its image internationally by investing in global sports.
During the course of 2022 the fund established the Sports Investment Company as a wholly owned subsidiary to invest in sports internationally and within the country. This year, the Saudi government transferred a further 4% of energy giant Aramco — worth almost $80 billion — to PIF.
The fund also manages a portfolio of US equities that includes stakes in Lucid Group Inc., Activision Blizzard Inc., and Uber Technologies Inc..
Egypt Nabs $1.9 Billion from State Asset Sales in Race for Cash - Bloomberg
Egypt signed deals worth $1.9 billion with private sector firms and a United Arab Emirates wealth fund as part of its plan to sell state assets, officials said on Tuesday, looking to send a clear signal of progress in efforts to revive an economy crippled by a foreign-currency crunch.
The divestments mark the most significant step in making good on broad plan announced in February to list new or additional stakes on the Egyptian stock exchange — or offer them to strategic investors. The program is a key part of the efforts to replenish coffers that suffered from the economic fallout of Russia’s invasion of Ukraine.
Among the deals was a $700 million investment by a unit of real estate developer Talaat Moustafa in a holding company that grouped several state-run hotels. In addition, the government sold $800 million in minority stakes in Egyptian Ethylene and Derivatives Company, National Drilling and Egyptian Linear Alkyl Benzene to ADQ, an Abu Dhabi fund, Planning Minister Hala Elsaeed said in a press conference.
In addition, the state sold a 31% stake in Ezz Aldekhela Steel for around $230 million, in a move that would have the company de-listed from the Egyptian stock exchange. Those deals were binding.
Mideast Stocks: Most Gulf markets rise ahead of US inflation data
Gulf stock markets mostly ended higher on Tuesday ahead of U.S. inflation data that could warrant a quicker end to Federal Reserve rate hikes, and as a rise in oil prices boosted sentiment. Most Gulf Cooperation Council (GCC) countries, including Quatar, Saudi Arabia and the United Arab Emirates, 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 advanced 0.7%, led by a 3% increase in Dr Sulaiman Al-Habib Medical Services and an 0.8% increase in Al Rajhi Bank. The Saudi bourse remained supported by strong local fundamentals and could see more gains this week, Farah Mourad, senior market analyst of XTB MENA, said.
"In addition, its performance could be reinforced if oil prices continue their recovery." Saudi Arabia's cabinet has reaffirmed the kingdom's desire to boost precautionary efforts by the Organization of the Petroleum Exporting Countries (OPEC) and their allies to stabilise oil markets, it said in a statement on Tuesday.
Dubai's main share index gained 0.2%, hitting its highest since late-2015, with budget airliner Air Arabia rising 3.1%. In Abu Dhabi, the index edged 0.1% higher. Oil prices - a catalyst for the Gulf's financial markets - edged higher, supported by supply cuts by the world's biggest oil exporters and expectations of higher demand in the developing world in the second half of 2023 despite a sluggish economic outlook.
The Qatari index, however, closed lower.
Outside the Gulf, Egypt's blue-chip index finished 1.1% higher, extending gains from the previous session. The Egyptian stock market remains on a potential downtrend, however, as trading volumes decreased and traders could return to selling, said Mourad. Egypt's year-on-year headline inflation hit a record 35.7% in June, official data showed on Monday, accelerating past the previous high reached in 2017 and reflecting economic strains since early last year.
Most Gulf markets gain ahead of US inflation data; Qatar eases | Reuters
Most major Gulf stock markets rose in early trade on Tuesday ahead of U.S. inflation data due on Wednesday that could support a more rapid end to Federal Reserve rate hikes.
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.
Saudi Arabia's benchmark index (.TASI) gained 0.4%, driven by a 1.1% rise in Dr Sulaiman Al-Habib Medical Services (4013.SE).
Separately, Saudi Arabia has sent $2 billion to Pakistan's central bank, the South Asian country's finance minister said on Tuesday, another boost for its ailing economy after an IMF bailout.
Dubai's main share index (.DFMGI) added 0.1%, trading at its highest since 2015, helped by a 2.7% increase in budget airline Air Arabia (AIRA.DU).
In Abu Dhabi, the index (.FTFADGI) rose 0.2%.
Oil prices - a key catalyst for the Gulf's financial markets - edged higher recouping some of the losses from the previous session, as traders focused on supply cuts by the world's biggest oil exporters Saudi Arabia and Russia and a weaker dollar.
In Qatar, the index (.QSI) fell 0.5%, as most of the stocks on the index were in negative territory including, Commercial Bank (COMB.QA), which was down 2.4%.
Dubai property prices surge at fastest pace since 2014 | Reuters
Dubai residential property prices in the year to June 30 rose at their fastest in almost a decade, climbing by 16.9%, while average rents jumped by 22.8%, property consultancy CBRE said on Tuesday.
The average apartment price per square foot reached 1,294 dirhams ($352.31) and villas averaged 1,525 dirhams per sq ft.
Dubai, home to the world's tallest skyscraper and palm-shaped man-made islands, has become one of the fastest-growing cities, recording a population of 3.6 million at July 5, according to the emirate's statistic centre.
Its property market has boomed after a swift post-pandemic economic rebound and relaxed residency rules.
In June 9,876 residential units were sold, up 18.8% from a year earlier, with off-plan sales jumping 44.9% while the secondary market's sales weakened by 0.5%, CBRE added.
Average rent was up 22.8% in the year to June 30, slowing from the 24.2% growth recorded at the end of May.
"Rental growth rates in several major areas are moderating and many listings within these communities are reducing asking rents," said Taimur Khan, CBRE's head of research.
BitOasis, Dubai-Based Crypto Exchange, Gets VARA Regulatory Reprimand - Bloomberg
Dubai is reprimanding BitOasis, one of the largest crypto platforms focused on customers in the Middle East, for failing to meet mandated conditions set forth by the local regulator.
Dubai, which pitches itself as a global crypto hub, has been tightening scrutiny of license seekers since last year’s bankruptcy of FTX. The emirate’s Virtual Assets Regulatory Authority issued a market alert on Monday, saying it had initiated an enforcement action against BitOasis.
“BitOasis is under review for not meeting mandated conditions, required to be satisfied within 30-60 day timeframes prior to being permitted to undertake any VARA regulated market activity,” the regulator said in the alert, which was sent to Bloomberg News.
Dubai has been requesting more information from applicants including Binance, the world’s largest digital-asset exchange, Bloomberg reported in April. The action against BitOasis, a well-known firm to local regulators, suggests an even stricter approach going forward.
Dubai School Operator Taaleem’s Profit Rises Amid Surge in Student Enrollments - Bloomberg
Dubai private school operator Taaleem Holdings reported a 34% increase in net profit, helped by a surge in student enrollments amid an influx of arrivals into the emirate.
Net profit rose to 200 million dirhams ($54.5 million) in the nine months to the end of May, the firm said in a statement on Tuesday. Taaleem added 28,563 students for the 2022-23 academic year, it said, reflecting an increase in the population of the United Arab Emirates.
Parents in the UAE are among the world’s biggest spenders when it comes to educating their children. Dubai’s emergence as a post-Covid haven has drawn expatriates to the emirate, further helping to prop up demand.
“The trajectory of growth in the United Arab Emirates economy is very exciting,” Chief Executive Officer Alan Williamson said in an interview with Bloomberg TV. “We expect around 65,000 young people to be entering the market in the next five years.”
Strong momentum in Dubai's non-oil sector lifts PMI to 10-month high in June
Dubai's non-oil private sector gathered strong momentum in June with increases in new businesses and output driving up employment and inventory levels, a survey showed on Tuesday.
The seasonally adjusted S&P Global UAE Purchasing Managers' Index (PMI) rose to 56.9 in June after slipping to 55.3 the previous month, signalling the strongest overall improvement in operating conditions in the sector since August 2022.
"Moreover, the headline index remained well above its long-run trend level of 54.6 and the month-on-month rise at 1.6 points was the largest recorded since October 2021," the report said.
The expansion in new business was underpinned by strong rise in demand, which rose for the 21st successive month, and at the fastest rate since August 2022.
"Dubai's non-oil private sector economy enjoyed accelerating growth of new business in June, supporting another marked rise in overall output. All three of the key sectors monitored - construction, wholesale & retail and travel & tourism - registered faster increases in new work mid-way through the year," said Trevor Balchin, Economics Director at S&P Global Market Intelligence.
Hiring continued for the 14th successive month in June, the longest run of continuous job creation in over six years. This was seen to be particularly robust in the construction sector.
Supply chains improved and firms continued to build inventory. Companies were also able to continue offering lower prices to customers despite a slightly faster rate of input price inflation during the month.
Meanwhile, the 12-month outlook for activity eased slightly since May but was still the second strongest since October 2021. Of the three key sectors monitored, construction was the most optimistic, followed closely by wholesale & retail.
