Emirates NBD Research
 

Find anything about our articles and more.
Enter a query in the search input above, and results will be displayed as you type.

Try typing "Dubai Economics", "Dubai GDP", "GCC Macro"

Emirates NBD
Search
Subscribe
   
  • Home
  • Economics

    Emirates NBD Research provides detailed coverage of 16 GCC and MENA economies, analysing them from a top down macro and strategic perspective as well as by a bottom up sector by sector approach.

    • SUBTOPICS
    • GCC Macro
    • MENA Macro
    • Global Macro
    • Sector Economics
    • Monthly Insights

     

    Latest Article Lebanon continues to face multiple challenges
    Latest Article UAE: A mixed bag of data in January
    Latest Article Moroccan growth will outperform MENA oil importer peers in 2021

     

  • Markets

    Emirates NBD Research publishes reports on global forex, rates and commodities, as well as regional fixed income and equity markets.

    • SUBTOPICS
    • Foreign Exchange
    • Fixed Income
    • Commodities
    • Equities
    • Monthly Insights

     

    Latest Article IEA lowers demand forecasts
    Latest Article Monthly Insights: January 2021
    Latest Article Gold prices stumble to start 2021

     

  • Daily
  • PMIs

    Emirates NBD sponsors Purchasing Managers’ Indices for the UAE, Saudi Arabia, Egypt and Dubai. The indices are compiled by IHS Markit, the leading global provider of financial market data.

    • SUBTOPICS
    • UAE PMI
    • Saudi Arabia PMI
    • Egypt PMI
    • Dubai PMI
    • Methodology

     

    Latest Article Dubai PMI moves back into expansion territory in December
    Latest Article Regional PMIs- Saudi PMI rises to year high in December
    Latest Article Regional PMI round-up: A mixed bag in November

     

  • About Us
  • EmiratesNBD.com
  • Subscribe
EQUITIES > MARKETS

Global equities staged a sharp rebound rally

Published Date: 12 April 2020

Facebook
Linkedin
Twitter
Email
Print

 

Global equities staged a sharp rebound rally as the Federal Reserve continued proactively to provide support and liquidity to markets. Some signs of a slowdown in the spread of coronavirus in some countries also provided support to investor sentiment. Having said that, this rally seems counterintuitive in light of initial projections which show a double-digit slowdown in most major economies and as most countries are forced to extend restrictions in economic activities.

Overall, the MSCI All Country index added +10.5% 5d on the back of strength across its sub-indices. The MSCI G7 index, the MSCI EM index and the MSCI FM index added +11.6% 5d, +6.8% 5d and +1.7% 5d respectively. Unsurprisingly, volatility eased off across markets.

Beyond coronavirus, investors will pay attention to economic data across economies as they continue to assess the extent of damage to the global economy. The IMF’s economic projections will also be watched as the first broad based multilateral agency guidance of global growth projections over the next 12 months. Further, the start of the Q1 2020 earnings season will also be on the radar.

Chart of the week

The sheer size of the support of central banks, especially in developed markets, can be gauged by the fact that the net purchases for G7 central banks in March 2020 were USD 1.4tn. According to Bloomberg, this is close to five times higher than the previous peak of USD 270bn in April 2009.

Quantitative easing at record highs

Source: Bloomberg

MENA Markets

Most regional markets closed higher amid positive global backdrop. The S&P Pan Arab Composite index added +4.4% 5d.

UAE bourses closed higher with the DFM index and the ADX index adding +8.8% 5d and +11.9% 5d respectively. The focus last week remained on banking sector stocks as they revealed the extent of their exposure to NMC and Finablr. Abu Dhabi Commercial Bank (-1.7% 5d) and Dubai Islamic Bank (-4.8% 5d) are most exposed with loans amounting to c.9.7% and c.7.2% of their CET1 respectively. First Abu Dhabi Bank, which has no exposure, led gains on the ADX index with a +21.1% 5d rally. Following the request of ADCB, NMC Health was placed into administration by a UK Court.

Beyond banks, Emaar-related shares rallied after the group took cost-cutting measures in light of the current economic situation. Further, it sold 80% of its Dubai District Cooling business to Tabreed for USD 675mn. Emaar Properties and Emaar Development ended the week with gains of +8.7% 5d and +5.6% 5d respectively.  

Saudi Arabian equities rallied for a third consecutive week with the Tadawul gaining +3.8% 5d. The rally was supported by strength in market heavyweight stocks with Saudi Aramco (+1.3% 5d) closing above its IPO price and Al Rajhi Bank gaining +1.5% 5d.

Kuwaiti stocks were a notable exception last week with the KWSE PM index losing -3.0% 5d. This was following the decision of MSCI to delay the country’s inclusion in the MSCI EM index to November 2020 from May 2020. The index provider cited the operational difficulties associated with the coronavirus outbreak as the reason for its decision.

Developed Markets

Investors in developed markets are at the moment choosing to focus on unparalleled support from global policymakers rather than the economic data which is painting a rather grim picture of the health of the global economy. The Federal Reserve announced a loan program worth USD 2.3tn to aid small and mid-sized businesses and state and local governments as well as fund the purchases of some types of high yield bonds, collateralized loan obligations and commercial mortgage-backed securities.

The sheer power of liquidity drove most developed market equities to a new technical bull market. Overall, the S&P 500 index, the Euro Stoxx 600 index and the Nikkei index rallied +12.1% w-o-w, +7.4%% w-o-w and +9.4% w-o-w respectively.

Emerging Markets

Emerging market equities rallied sharply but underperformed the broader market. The MSCI EM index added +6.8% 5d relative to a +11.0% 5d gain in the MSCI World index. The rally was supported by strength in EM currencies following a sharp decline in the USD. The JP Morgan EM Currencies index added +3.2% 5d. The underperformance can be put down to Chinese equities which closed nearly flat for the week.

Click here to see the full publication

Written By:
,

RELATED ARTICLES

Global equities moved higher
21.06.2020

GCC Equity Flow Monitor - May 2020
15.06.2020

Global equities suffered a reversal last week
14.06.2020

Last week global equities had one of their best weeks
07.06.2020

Notwithstanding heightened political tensions, global equities rallied last week
31.05.2020

See all

LATEST ARTICLES

Regional growth to be driven by improving global backdrop
13.01.2021

Lebanon continues to face multiple challenges
25.01.2021

UAE: A mixed bag of data in January
21.01.2021

See all
 

 Subscribe to our newsletter


Never miss out what is going on in UAE Economics

KEEP READING MORE

Regional growth to be driven by improving global backdrop

We expect GCC growth to average 2.3 percent in 2021 following an estimated 5 percent contraction in 2020.

ECONOMICS, GCC MACRO - 13.01.2021

Monthly Insights: January 2021

A round-up of our key research insights and forecasts this month.

ECONOMICS, MARKETS - 17.01.2021

Energy markets focus on US presidential election

Oil industry braces for a Biden administration.

MARKETS, COMMODITIES - 25.10.2020

 

Markets pricing in Democratic victory

Anticipation of a Democratic win in the US election is sending yields higher.

MARKETS, FX - 27.10.2020

MENA Quarterly Q4 2020

Our quarterly report on MENA economies

ECONOMICS, MENA MACRO - 13.10.2020

OPEC and allies reach agreement for 2021

The oil market should be able to absorb modest production increases

MARKETS, COMMODITIES - 06.12.2020

Green bond market has room to expand in MENA

Renewables projects across the region could attract new pool of investors.

MARKETS, FIXED INCOME - 21.10.2020

  • Economics
  • Markets
  • PMIs
  • About Us
  • Subscribe to our publications
  • Economics
  • GCC Macro
  • MENA Macro
  • Global Macro
  • Sector Economics
  • Markets
  • Foreign Exchange
  • Fixed Income
  • Commodities
  • Equities
  • PMIs
  • UAE PMI
  • Saudi Arabia PMI
  • Egypt PMI
  • Dubai Economy Tracker
  • Methodology
  • About Us
  • Subscribe to our publications

 


Terms and Conditions
Copyright © 2021 Emirates NBD Bank PJSC. All Rights Reserved