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From: Mahmoud Jamal
Mubasher: Gulf markets will see some improvement and recover Wednesday, offsetting the rest of the week, supported by five key factors, including significant gains in US stocks, a result of the temporary pause in the trade war, badysts said .
At the end of Tuesday's session, the Gulf markets fell after the United States had described China as a currency manipulator, thus confirming the escalation of the trade war.
Tuesday night, US markets closed up nearly 2% after the People's Bank of China set the average trading range of the national currency in Beijing to facilitate the conflict between Washington and Beijing.
The People's Bank of China set the average exchange rate in local currency at 6.9683 yuan per dollar, exceeding expectations, with the aim of easing the dispute between Washington and Beijing after the US currency crossed the 7-digit barrier. Yuan yesterday for the first time in ten years.
This took place after the United States officially labeled China as "currency manipulator", while Yakin said that such a decision was threatening the global financial system.
Trade tensions between China and the United States have recently intensified after China decided to stop importing Washington's agricultural products, as a result of the latter's intention to Impose tariffs on the rest of Chinese imports early next month.
Positive signal
The CEO of VI Markets – Egypt said that China's efforts to calm the currency war are a positive signal for the global and regional financial markets after the intensification of the recent trading war.
Recent investor speculation about the possibility of further US rate cuts in September should allow some Gulf markets to obtain a temporary rebound today, Ahmed Moati said.
Investors have a 100% chance that the Fed will lower US interest rates in September. The US central bank cut interest rates by a quarter of a percentage point for the first time in 10 years last month, reaching a level between 2% and 2.25%.
He pointed out that the results of the successively disclosed activities, which are currently determining the destination of investors in the long term, still have an impact on the Gulf markets, noting that the results of some of the major Saudi and UAE companies were below expectations.
He explained that these results had affected the morale of investors who had preferred, during this week's sessions, to monitor and avoid opening new positions on equities, especially due to the lack of clarity on the stock market. global economy after the outbreak of the trade war.
At the end of yesterday's session, Emaar Development had lost 3.1% after the company had announced a 24% drop in its net profit in the first half. The prices of luxury real estate in Dubai have fallen 1.9% in the first half of the year due to oversupply, Savills Properties said.
Abu Dhabi Bank of Sharjah plunged 9.9%, its largest loss since January 2009. The bank recorded a 24% decline in profits in the first half.
He explained that investors are currently reevaluating share price levels in global markets to determine their impact on the expected global level of share price growth.
Correct due
Mona Mustafa, a technical badyst and member of the Scientific Committee of the African Economic Council, said the Gulf markets were in a correction phase due to strong monthly gains at the end of last month.
She pointed out that some of the correctional operations are about to be completed in some markets such as the UAE, including "Abu Dhabi" and the Kuwaiti index, which is expected to increase in the medium term.
She pointed out that the Saudi market continues to experience a strong recovery that could continue beyond the earnings season, and advised investors to retain at least 50% of the cash invested in shares until the return of Eid holidays.
She pointed out that the fundamentals of the Saudi market could be favorable given the high dividend and incomplete financial results of the second quarter of this year.
The P / E is one of the most important indicators on which portfolio managers and major investors depend, as well as the book value multiplier, based on their decision to invest in the financial markets. The biannual reporting season expands until the middle of the month.
The Gulf markets are now subject to Donald Trump's decisions regarding the trade war against China, which is an important economic partner for the major Gulf countries.
Decisions have caused the exodus of about $ 3 billion of emerging market equities and bonds this week, according to the IIF.
She stressed that any calm in this trade war would change the price of the Gulf markets, bring back the normal course of events, and then return to the gains, gains, and logical movements of the indicators in general.
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