Saudi Arabia Posts Budget Deficit as Capex Spending Climbs - Bloomberg
Saudi Arabia recorded a sixth straight quarterly budget deficit as increased spending on capital expenditure and other areas outpaced growth in revenue.
The shortfall stood at 12.4 billion riyals ($3.3 billion) in the first quarter, more than four times higher than a year ago, according to a statement from the Ministry of Finance on Sunday. On a quarterly basis, the deficit eased from about 37 billion riyals at the end of 2023.
Total expenditures rose 8% year on year, while revenues expanded by 4%. Both oil and non-oil revenue climbed.
Saudi Arabia’s budget has been in a deficit since late 2022, when the country began cutting oil production to help stabilize global prices. The kingdom has also been increasing spending as it races to complete projects and develop new industries aimed at diversifying the economy under Crown Prince Mohammed bin Salman’s Vision 2030 agenda.
The government has forecast a budget deficit of 79 billion riyals for this year and expects to see a fiscal shortfall in 2025 and 2026.
Sunday 5 May 2024
Gulf bourses end higher as Fed cut hopes rise | Reuters
Gulf bourses end higher as Fed cut hopes rise | Reuters
Stock markets in the Gulf ended higher on Sunday, led by the Qatar index, after slowing U.S. jobs growth in April raised hopes of early interest rate cuts by the U.S. Federal Reserve.
The Labor Department's employment report showed the U.S. economy added fewer jobs than expected, while the unemployment rate ticked higher and wage growth unexpectedly cooled.
The report prompted investors to raise bets the Fed would implement its first rate reduction in September.
Most Gulf currencies are pegged to the dollar, and any U.S. monetary policy changes are usually followed by Saudi Arabia, the United Arab Emirates and Qatar.
The Qatari benchmark index (.QSI), opens new tab bounced back after three straight sessions of losses and ended 0.8% higher with all sectors in the positive territory.
Qatar National Bank(QNBK.QA), opens new tab, the region's largest lender, rose 1.2% and Industries Qatar (IQCD.QA), opens new tab gained 0.7%.
Saudi Arabia's benchmark index (.TASI), opens new tab was up for a second straight session and rose 0.2%, lifted by gains in finance, industry, consumer discretionary and energy sectors.
Al Rajhi Bank(1120.SE), opens new tab, the world's largest Islamic lender, and Saudi National Bank(1180.SE), opens new tab, the kingdom's biggest lender climbed 1.5% each.
Among other gainers, Thob Al Aseel (4012.SE), opens new tab advanced 3.5%, after the garments supplier reported a 44% rise in quarterly net profit.
Meanwhile, Saudi Arabia's non-oil business activity grew at a steady rate in April despite a slowdown in new order growth, a survey showed on Sunday, with domestic demand driving output.
The Labor Department's employment report showed the U.S. economy added fewer jobs than expected, while the unemployment rate ticked higher and wage growth unexpectedly cooled.
The report prompted investors to raise bets the Fed would implement its first rate reduction in September.
Most Gulf currencies are pegged to the dollar, and any U.S. monetary policy changes are usually followed by Saudi Arabia, the United Arab Emirates and Qatar.
The Qatari benchmark index (.QSI), opens new tab bounced back after three straight sessions of losses and ended 0.8% higher with all sectors in the positive territory.
Qatar National Bank(QNBK.QA), opens new tab, the region's largest lender, rose 1.2% and Industries Qatar (IQCD.QA), opens new tab gained 0.7%.
Saudi Arabia's benchmark index (.TASI), opens new tab was up for a second straight session and rose 0.2%, lifted by gains in finance, industry, consumer discretionary and energy sectors.
Al Rajhi Bank(1120.SE), opens new tab, the world's largest Islamic lender, and Saudi National Bank(1180.SE), opens new tab, the kingdom's biggest lender climbed 1.5% each.
Among other gainers, Thob Al Aseel (4012.SE), opens new tab advanced 3.5%, after the garments supplier reported a 44% rise in quarterly net profit.
Meanwhile, Saudi Arabia's non-oil business activity grew at a steady rate in April despite a slowdown in new order growth, a survey showed on Sunday, with domestic demand driving output.
#AbuDhabi Hub Carrier Etihad Adds Banks to $1 Billion IPO - Bloomberg
Abu Dhabi Hub Carrier Etihad Adds Banks to $1 Billion IPO - Bloomberg
Abu Dhabi hub carrier Etihad Airways PJSC has added banks to its planned initial public offering that could raise as much as $1 billion, according to people familiar with the matter.
Abu Dhabi Commercial Bank PJSC, Bank of America Corp., BNP Paribas and Morgan Stanley have been picked as joint bookrunners on the potential share sale, the people said, asking not to be identified as the information isn’t public. Abu Dhabi wealth fund ADQ, which owns Etihad, is targeting a listing for the end of the year, the people said.
Representatives of Morgan Stanley, ADQ, Bank of America, ADCB and Etihad declined to comment while BNP Paribas didn’t immediately respond to a request for comment.
The fund had already picked Citigroup Inc., HSBC Holdings Plc and First Abu Dhabi Bank as lead advisers for the IPO, Bloomberg News reported in March. Rothschild & Co. is acting as an independent financial adviser to the Abu Dhabi wealth fund.
An IPO of Etihad will create the first publicly-traded major Gulf hub carrier and come amid a rebound in international travel following the pandemic. The Abu Dhabi airline reported a five-fold increase in annual profit in March as it expanded its network to tap growing demand for travel.
Abu Dhabi hub carrier Etihad Airways PJSC has added banks to its planned initial public offering that could raise as much as $1 billion, according to people familiar with the matter.
Abu Dhabi Commercial Bank PJSC, Bank of America Corp., BNP Paribas and Morgan Stanley have been picked as joint bookrunners on the potential share sale, the people said, asking not to be identified as the information isn’t public. Abu Dhabi wealth fund ADQ, which owns Etihad, is targeting a listing for the end of the year, the people said.
Representatives of Morgan Stanley, ADQ, Bank of America, ADCB and Etihad declined to comment while BNP Paribas didn’t immediately respond to a request for comment.
The fund had already picked Citigroup Inc., HSBC Holdings Plc and First Abu Dhabi Bank as lead advisers for the IPO, Bloomberg News reported in March. Rothschild & Co. is acting as an independent financial adviser to the Abu Dhabi wealth fund.
An IPO of Etihad will create the first publicly-traded major Gulf hub carrier and come amid a rebound in international travel following the pandemic. The Abu Dhabi airline reported a five-fold increase in annual profit in March as it expanded its network to tap growing demand for travel.
Egypt’s Outlook Raised by Fitch After $57 Billion Global Bailout - Bloomberg
Egypt’s Outlook Raised by Fitch After $57 Billion Global Bailout - Bloomberg
Egypt’s credit rating outlook was raised to positive from stable by Fitch Ratings, after the North African nation secured an international bailout of $57 billion for its cash-strapped economy.
Fitch affirmed Egypt’s B- rating, leaving it six notches below investment grade. It also came weeks after authorities agreed to a landmark $35 billion investment deal with the United Arab Emirates and additional support from the International Monetary Fund and the World Bank.
“Near-term external financing risks have markedly reduced” thanks to the UAE deal, Fitch said in a statement. “The move to a flexible exchange rate and the tightening of monetary policy” have also helped, the ratings company added.
Those investment pledges and a jumbo interest-rate hike allowed Egypt to let its currency devalue, as part of the country’s efforts to mitigate one of its worst foreign-exchange shortages in decades.
Egypt’s credit rating outlook was raised to positive from stable by Fitch Ratings, after the North African nation secured an international bailout of $57 billion for its cash-strapped economy.
Fitch affirmed Egypt’s B- rating, leaving it six notches below investment grade. It also came weeks after authorities agreed to a landmark $35 billion investment deal with the United Arab Emirates and additional support from the International Monetary Fund and the World Bank.
“Near-term external financing risks have markedly reduced” thanks to the UAE deal, Fitch said in a statement. “The move to a flexible exchange rate and the tightening of monetary policy” have also helped, the ratings company added.
Those investment pledges and a jumbo interest-rate hike allowed Egypt to let its currency devalue, as part of the country’s efforts to mitigate one of its worst foreign-exchange shortages in decades.
#SaudiArabia's non-oil business activity growth steady in April-PMI | Reuters
Saudi Arabia's non-oil business activity growth steady in April-PMI | Reuters
Saudi Arabia's non-oil business activity grew at a steady rate in April despite a slowdown in new order growth, a survey showed on Sunday, with domestic demand driving output.
The seasonally-adjusted Riyad Bank Saudi Arabia Purchasing Managers' Index stood at 57.0 in April, the same as March, and well above the 50.0 mark denoting expansion in activity.
The Output subindex retreated slightly to 61.9 in April from a six month high of 62.2 the previous month, but continued to reflect strong demand conditions, with Wholesale & Retail registering the strongest expansion in output.
"This uptrend hints at an anticipated spike in the non-oil GDP, likely exceeding the 4.5% mark for this year," Naif Al Ghaith, Riyad Bank's chief economist, said about the overall PMI.
Saudi Arabia's non-oil business activity grew at a steady rate in April despite a slowdown in new order growth, a survey showed on Sunday, with domestic demand driving output.
The seasonally-adjusted Riyad Bank Saudi Arabia Purchasing Managers' Index stood at 57.0 in April, the same as March, and well above the 50.0 mark denoting expansion in activity.
The Output subindex retreated slightly to 61.9 in April from a six month high of 62.2 the previous month, but continued to reflect strong demand conditions, with Wholesale & Retail registering the strongest expansion in output.
"This uptrend hints at an anticipated spike in the non-oil GDP, likely exceeding the 4.5% mark for this year," Naif Al Ghaith, Riyad Bank's chief economist, said about the overall PMI.
Mubadala Capital plans $13.5bn biofuels investment in Brazil
Mubadala Capital plans $13.5bn biofuels investment in Brazil
Abu Dhabi’s Mubadala Capital intends to invest about $13.5bn on a major biofuels project in Brazil over the next decade, under broader plans for the country that include the creation of a new stock exchange.
The asset management arm of the Emirati sovereign wealth fund is increasing its bets on Latin America’s largest economy, where its holdings span metro lines and medical universities to a majority stake in the local owner of the Burger King brand — alongside Donald Trump’s son-in-law, Jared Kushner.
In an interview with the Financial Times, Mubadala Capital’s head of Brazil revealed for the first time the full budget of its flagship scheme to produce renewable diesel and “sustainable” aviation kerosene mainly using non-food plant matter.
The large-scale development by its energy company, Acelen, will comprise five $2.7bn “modules”, with the first due to begin production by the end of 2026. Each will consist of a new biorefinery with capacity to process 20,000 barrels of fuel per day, associated infrastructure and planted areas to grow the input crop.
“It’s all about feedstock [which] in reality is agriculture. And Brazil is probably the best-placed country on the planet when it comes to agricultural proficiency because of the climate and the fertile soil,” said Oscar Fahlgren. “Brazil is to agriculture what Abu Dhabi is to oil.”
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