Weekly Market Review 28th June 2015 – 4th July 2015

CONTENTS

International Equity Markets

GCC Equity

Currencies

Commodities

Interest Rates

Equity Markets - Top Most & Bottom Most

Commodity Markets - Top Most & Bottom Most

US non-farm payrolls rose 223,000 in Jun vs. 254,000 increase in May, tempering down rate hike expectations

New orders for factory goods fell more than forecasts by 1% in May after a revised 0.7% decline in Apr

Markit final manufacturing PMI slipped to 53.6 in Jun from 54 in May as manufacturing growth eased

US pre-owned home sales rose 10.4% YoY in May, providing further boost to housing market

Conference Board’s consumer confidence index jumped to 101.4 in Jun from 94.6 in May

Markit/JP Morgan’s Global manufacturing PMI slid to 51 in Jun from 51.3 in May, matching near 2-year low in Apr

Euro zone businesses shrug off Greek fears as Markit’s final composite PMI for Jun climbed to 54.2 vs. 53.6 in May

Consumer prices growth softened to 0.2% YoY in Jun vs. rising 0.3% in May as energy costs weakened

Markit’s German Jun manufacturing PMI gained to 51.9 from 51.1 in May, indicating manufacturing gained traction

UK 1Q2015 GDP gained 0.4% vs. 0.3% increase estimated earlier, led by consumer spending & business investment

Greece shut its banks and imposed a daily limit on ATM withdrawals as it missed a $1.7bn IMF payment on Jun 30

Moody’s downgraded Greece to 'Caa3' from 'Caa2‘ on IMF loan default, following Fitch and S&P

Japan May industrial output slid 2.2% MoM as compared to 1.2% increased recorded in Apr, denting recovery

Markit/Nikkei Services PMI rose to 51.8 in Jun vs. 51.5 in May, indicating strengthening domestic demand

China’s official PMI stood unchanged in Jun from May at 50.2, indicating factory activity remained sluggish

HSBC/Markit services PMI for Jun fell to 51.8 from 53.5 in May, suggesting economy still needs support

The World Bank cleared a $650mn loan for Indian freight rail corridor spanning 1,840 kilometers

Fitch affirmed Russia’s investment-grade rating of ‘BBB-’ while maintaining its negative outlook for the nation

Fitch Ratings maintained Malaysia’s credit ranking at ‘A-’. Outlook was revised to stable from negative

The UAE became a founding member of China-led Asia Infrastructure Investment Bank, joining 57 other nations

Moody's cut Puerto Rico's bonds to 'Caa3' from 'Caa2’, citing commonwealth’s statement that it cannot pay its debt

S&P 500 – 1 year performance Euro Stoxx 600 – 1 year performance

Source: Bloomberg, Mashreq Private Banking

INTERNATIONAL EQUITY MARKETS

Last Close Change 5 Day % YTD %

S&P 500 2,076.78 -24.71 -1.18 0.87

DJI 17,730.11 -216.57 -1.21 -0.52

Nasdaq Comp 5,009.21 -71.29 -1.40 5.77

Euro Stoxx 600 383.42 -13.43 -3.38 11.93

FTSE 100 6,585.78 -167.92 -2.49 0.30

Dax 11,058.39 -434.04 -3.78 12.78

CAC 40 4,808.22 -250.95 -4.96 12.53

Nikkei 225 20,539.79 -166.36 -0.80 17.70

Hang Seng 26,064.11 -599.76 -2.25 10.42

Brazil - Bovespa 52,519.41 -1,497.56 -2.77 5.02

Russia - Micex 1,631.65 -12.80 -0.78 16.83

BSE Sensex 28,092.79 280.95 1.01 2.16

Shanghai Comp 3,686.92 -505.96 -12.07 13.98

Source: Bloomberg, Mashreq Private Banking

Abu Dhabi Islamic Bank’s shareholders approved to increase issued share capital by AED168mn through rights issue

Abu Dhabi Nat. Energy Co. denied news that it is engaged in merger talks with any state-owned or other entity

Emaar Properties’ Egyptian subsidiary will list on Jul 5, 2015. It raised $298.8mn from its IPO recently

Drake & Scull International raised the shareholding limit for GCC national to 100% from 49%

Etihad Airways and Pakistan Int. Airlines signed codeshare agreement, providing enhanced connections to travelers

Nestle will invest $118.9mn to build a coffee and culinary product factory in Dubai, employing 400 staff

UAE-based Gulf Petrochem Group acquired Essar Petroleum East Africa to enhance group’s services and products

Dubai’s Limitless said it would repay AED2.07bn to creditors and won approval to extend remaining debt to Dec ‘18

Trading house Trafigura sold 50% of its stake in 3 Spanish copper and zinc mines to Mubadala as a part of JV

Yanbu Cement Company’s 2Q2015 net profit edged-up 2.1% YoY to SAR246mn. Operating profit grew 9.2% YoY

Abdullah A.M. Al-Khodari received letter of award for 2 projects worth SAR147.3mn from the Ministry of Transport

National Shipping Co. of Saudi signed contract with Hyundai Samho to build additional 5 very large crude carriers

Meezan Bank signed an agreement to acquire Pakistan operations of HSBC Bank Oman in 2H2015

Oman National Inv. Corp. and Oman International Dev. & Inv. shareholders approved the merger between the two

Oman’s National Aluminium Products said its plan to double current capacity of 18,000 tons/year is on track

Bank Dhofar signed non-binding MoU with Bank Sohar on proposed merger, agreed to proceed with due diligence

Qatar Islamic Bank raised QAR2bn Basel III compliant Sukuk to enhance capital adequacy & support future growth

Doha Bank issued Tier I capital instruments amounting to QAR2bn on Jun 30, 2015

Qatar’s Al Meera Consumer Goods’ two subsidiaries will together sell a 49% stake in Al Oumara Bakery for QAR3mn

Qatar National Bank and Bahrain's Arab Bank Corp. reportedly mull buying minority stake in Turkish Finansbank

Bahrain’s Global Inv. House signed agreement to manage $40mn portfolio of non-core assets for a Kuwaiti bank

Last Close Change 5 Day % YTD %

Dubai 4,088.82 -57.91 -1.40 8.34

Abu Dhabi 4,726.72 -34.04 -0.72 4.37

Saudi Tadawul 9,136.34 -230.95 -2.47 9.64

Qatar Index 12,121.08 -12.15 -0.10 -1.34

Kuwait Index 6,181.89 -29.84 -0.48 -5.41

Oman MSM 30 6,443.96 2.01 0.03 1.59

Bahrain All Share 1,350.38 -18.05 -1.32 -5.34

Egypt EGX 30 8,314.72 -91.45 -1.09 -6.85

Istanbul 100 Index

81,216.98 -2,329.08 -2.79 -5.25

Source: Bloomberg, Mashreq Private Banking

DFMGI – 1 year performance Saudi Tadawul – 1 year performance

GCC EQUITIES

Source: Bloomberg, Mashreq Private Banking

The US dollar strengthened versus 13 of its 16 major peers in the week, with Bloomberg Dollar Spot Index up 0.6% to 1,187.07 as Greece holds a vote on Jul 5 that may go a long way to determine if the nation stays in the euro area

British pound weakened 0.65% in the week to 71.38 pence per euro as a survey showed Greece’s voters were split before a referendum Sunday on whether to accept the terms of a European financial bailout

Japanese yen appreciated 0.86% in the week to 122.79 per US dollar as investors sought out haven assets against the backdrop of Greece's deepening debt crisis

China’s yuan gained 0.06% in the week against US dollar, registering biggest weekly gain since May as the People’s Bank of China’s Governor said the liberalization of financial markets will be accelerated

Australian dollar declined 1.7% against US dollar in the week on signs of sluggish consumer spending and after iron ore prices slid the most in two months. Retail sales rose 0.3% MoM in May, below estimate of 0.5% growth

Brazil’s real depreciated 0.16% in the week to 3.1343 per US dollar after the central bank said it would ease its support even as inflation accelerates

New Zealand’s dollar fell 2.3% in the week to 1.4944 per US dollar after a slide in milk prices increased speculation New Zealand’s central bank will cut interest rates

Last Close Change 5 Day % YTD %

EUR/USD 1.1114 -0.0053 -0.47 -8.13

GBP/USD 1.5570 -0.0176 -1.12 -0.04

AUD/USD 0.7523 -0.0132 -1.72 -7.98

USD/JPY 122.7900 -1.0600 -0.86 2.51

USD/CHF 0.9404 0.0071 0.76 -5.42

USD/CAD 1.2574 0.0253 2.05 8.20

USD/BRl 3.1343 0.0050 0.16 17.94

USD/RUB 55.9695 1.1631 2.12 -7.85

USD/INR 63.4388 -0.2037 -0.32 0.63

USD/CNY 6.2055 -0.0039 -0.06 0.00

DXY Index 96.1130 0.6410 0.67 6.47

EUR/USD – 1 year performance GBP/USD – 1 year performance

Source: Bloomberg, Mashreq Private Banking

CURRENCIES

Source: Bloomberg, Mashreq Private Banking

Spot gold price declined 0.6% in the week as the outlook for higher US interest rates in 2015 outweighed demand for a haven spurred by Greece’s debt crisis

Brent and West Texas Intermediate (WTI) recorded their worst week since March, dropping 4.7% and 6.9% as news and data pointed to a persistent oil market oversupply. Reports showed US crude stockpiles rose last week for the first time in 9 weeks while the number of rigs drilling for oil in the US rose for the first time in 7 months

LME tin futures tumbled 3.7% in the week as Indonesian exports of refined tin rose unexpectedly in Jun, despite the majority of producers signing up to an agreement to maintain a 4,000-ton ceiling on monthly exports

Corn futures on Chicago Board of Trade (CBoT) jumped 9.0% in the week as the USDA lowered 2015 US corn acreage to 88.897mn versus the March Prospective Plantings estimate of 89.199mn

ICE coffee futures fell 4.6% in the week as a consensus for Brazilian production at the higher end of recent forecasts kept Arabica coffee prices under pressure

Copper futures lost 1.0% in the week on worries about the fallout from Greece. Prices of copper, used in power and construction, are expected to come under pressure in coming weeks from a seasonal lull in Chinese demand

Last Close Change 5 Day % YTD %

Gold spot 1,168.48 -7.07 -0.60 -1.38

Silver spot 15.70 -0.11 -0.68 -0.05

Copper-CMX 261.80 -2.65 -1.00 -7.34

Brent - ICE 60.32 -2.94 -4.65 -2.87

WTI - Nymex 55.52 -4.11 -6.89 -1.32

S&P GSCI Spot Index

433.81 -1.93 -0.44 3.75

Baltic Dry Index 805.00 -18.00 -2.19 2.94

WTI Crude – 1 year performance GOLD – 1 year performance

Source: Bloomberg, Mashreq Private Banking

COMMODITIES

Source: Bloomberg, Mashreq Private Banking

US bond prices strengthened in the week and 10 year yield dipped 9.0 bps to 2.38% as the latest US jobs report reaffirmed investors' belief that the Federal Reserve would be patient in raising interest rates

Euro zone government bond yields rose on Greek anxiety after a defiant Greek Prime Minister Alexis Tsipras urged voters to reject a bailout deal in Sunday's referendum, cooling hopes of a breakthrough. Spanish and Italian 10-year bond yields rose 10 bps each in the week to 2.21% and 2.25%, respectively

UK government bonds recorded their biggest weekly gain since March, sending 10 year yield down 19 bps to 2.0% as Greek turmoil propelled safe-haven buying

Sweden's central bank cut its benchmark interest rate to -0.35% in a surprise move on Jul 2 and expanded its asset purchase program in a bid to reinforce tentative signs that long-stagnant consumer prices are finally picking up

China’s central bank reduced its benchmark lending rate, effective Jun 28, for a 3rd time in 2015 by 25 bps to 4.85% and lowered reserve-requirement ratios for some lenders after stocks plunged and local government bond sales drained liquidity

Bank of Angola raised its benchmark interest rate on Jun 30 for a 2nd time in 2015 by 50 bps to 9.75% after the currency was devalued, stoking inflation

Last Close Change 5 Day % YTD %

USD-1w Libor 0.15 0.0020 1.37 9.63

USD-3m Libor 0.28 0.0017 0.62 10.92

USD-6m Libor 0.45 0.0083 1.86 25.33

USD-10yr 2.38 -0.0903 -3.65 9.72

AED-1m EIBOR 0.41 0.0014 0.35 4.71

AED-3m EIBOR 0.75 0.0071 0.96 11.18

AED-12m EIBOR 1.09 0.0086 0.80 6.89

UK-10yr 2.00 -0.1900 -8.69 13.72

Japan-10yr 0.48 0.0140 3.02 48.45

US 10 year Generic Yield – 1 year performance UK 10 year Generic Yield – 1 year performance

Source: Bloomberg, Mashreq Private Banking

INTEREST RATES

Source: Bloomberg, Mashreq Private Banking

Ref Country Weekly Change Weekly Change

(USD Adj.)

1 China -12.07% -12.01%

2 Kazakhstan -5.81% -5.81%

3 Italy -5.43% -5.88%

4 Spain -5.21% -5.66%

5 France -4.96% -5.41%

6 Luxembourg -4.91% -5.36%

7 Finland -4.40% -4.85%

8 Portugal -4.38% -4.83%

9 Netherlands -4.11% -4.57%

10 Mongolia -4.04% -4.97%

Ref Country Weekly Change Weekly Change

(USD Adj.)

1 Vietnam 5.96% 6.13%

2 Pakistan 4.64% 4.75%

3 New Zealand 1.91% -0.55%

4 Malaysia 1.39% 1.08%

5 Indonesia 1.22% 1.13%

6 Venezuela 1.16% 1.16%

7 India 1.01% 1.33%

8 Botswana 0.77% 0.28%

9 Argentina 0.70% 0.45%

10 South Korea 0.68% 0.09%

WEEKLY

Ref Country YTD Change YTD Change (USD Adj.)

1 Venezuela 246.22% 246.22%

2 Argentina 37.15% 27.57%

3 Hungary 31.50% 21.50%

4 Jamaica 28.38% 25.70%

5 Denmark 28.24% 17.58%

6 Malta 23.32% 13.29%

7 Ireland 19.31% 9.61%

8 Italy 18.39% 8.76%

9 Japan 17.70% 14.82%

10 Slovakia 16.45% 6.98%

YTD

Ref Country YTD Change YTD Change (USD Adj.)

1 Colombia -13.24% -21.81%

2 Peru -11.76% -17.23%

3 Cyprus -10.01% -17.33%

4 Bulgaria -7.90% -15.46%

5 Slovenia -7.60% -15.11%

6 Egypt -6.85% -13.85%

7 Nigeria -6.11% -13.43%

8 Kuwait -5.41% -8.43%

9 Bahrain -5.34% -5.35%

10 Kazakhstan -5.33% -7.29%

EQUITY MARKETS - TOP MOST & BOTTOM MOST

Source: Bloomberg, Mashreq Private Banking

Ref Commodity Weekly Change

1 WTI Crude -6.89%

2 Steel Rebar -5.65%

3 Brent Crude -4.65%

4 Coffee -4.63%

5 Tin -3.66%

6 Nickel -3.61%

7 Heat Oil -3.41%

8 Gasoil -3.31%

9 Orange Juice -2.58%

10 Gasoline -2.32%

Ref Commodity Weekly Change

1 Corn 9.03%

2 Sugar 5.40%

3 Bean Meal 4.72%

4 Lean Hogs 4.41%

5 Soybeans 4.32%

6 Rough Rice 4.22%

7 Wheat 4.18%

8 Ethanol 3.10%

9 Live Cattle 1.90%

10 Natural Gas 1.84%

WEEKLY

Ref Commodity YTD Pct Change

1 Gasoline 39.41%

2 Cocoa 13.20%

3 Cotton 10.10%

4 Gasoil 8.35%

5 Corn 5.73%

6 Rubber 4.73%

7 Soybean Oil 4.35%

8 Soybeans 2.55%

9 Ethanol 0.06%

10

YTD

Ref Commodity YTD Pct Change

1 Steel Rebar -28.96%

2 Tin -26.03%

3 Coffee -24.61%

4 Nickel -20.79%

5 Orange Juice -16.46%

6 Sugar -15.29%

7 Palladium -14.05%

8 Natural Gas -13.39%

9 Lumber -12.87%

10 Platinum -10.33%

COMMODITY MARKETS - TOP MOST & BOTTOM MOST

Source: Bloomberg, Mashreq Private Banking

IMPORTANT NOTICE

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