Times have changed, and the market is adapting. Sovereign wealth funds and central banks are altering their approaches in a bid to navigate the volatile global environment, Reuters reported, citing a survey by US-based global investment firm Invesco.

Investors are getting worried: The survey — taking place between January and March before Trump’s “Liberation Day” announcements — still showed a surge in concerns regarding market volatility and increased protectionism. Further down the road, climate change and higher levels of sovereign debt add to investors’ worries over the next 10 years.

Active management is the new trend: Funds managing over USD 100 bn in assets are increasingly moving to active management of their portfolios to weather the storm. While passive management — following weighted indices and portfolios — is traditionally more preferred as it seems to deliver better results, it needs predictable market conditions, which is “no longer the case,” Invesco’s head of official institutions Rod Ringrow told the newswire.

China is grabbing attention too: About 60% of wealth funds are planning to invest in Chinese assets, especially the tech market, in the next five years, with the “strategic urgency they once directed toward Silicon Valley,” according to the survey.

Alternative sources of income include private credit, with half of the funds actively increasing their allocations. Stablecoins — crypto pegged to USD and other currencies — are also seeing growing interest, especially among funds in emerging markets.

ALSO- Two thirds of the 58 central banks surveyed said they want larger, more diversified reserves to prepare for what is to come. Over 70% expressed concerns over US debt levels negatively affecting the USD over the long term.

BUT- Don’t expect the USD to weaken anytime soon. Some 78% expect the USD to maintain its strength for at least two more decades, until a credible alternative can rise to butt heads with the world’s reserve currency.

ALSO FROM PLANET FINANCE-

  • BTC climbed to an all-time high beyond the USD 120k threshold yesterday amid growing investor sentiment and favorable market conditions. The cryptocurrency has gained over 29% YTD. (Reuters)
  • Investment banking at major US banks could be in for its 14th consecutive quarterly underperformance in 2Q 2025, with revenues projected to fall nearly 10% y-o-y to USD 7.5 bn — less than a quarter of total revenues — for JP Morgan Chase, Bank of America, Citigroup, Goldman Sachs, and Morgan Stanley. (Financial Times)

MARKETS THIS MORNING-

Asian markets are mostly in the green this morning, while investors wait for insights on China’s economy. Hong Kong’s Hang Seng is up 0.8%, while Shanghai Composite is down 0.5%. Wall Street investors are also waiting for big banks’ earnings and inflation data, keeping futures virtually unchanged.

EGX30

33,727

+2.0% (YTD: +13.4%)

USD (CBE)

Buy 49.40

Sell 49.53

USD (CIB)

Buy 49.41

Sell 49.51

Interest rates (CBE)

24.00% deposit

25.00% lending

Tadawul

11,214

-0.4% (YTD: -6.8%)

ADX

10,063

0.0% (YTD: +6.8%)

DFM

5,857

0.0% (YTD: +13.5%)

S&P 500

6,269

+0.1% (YTD: +6.6%)

FTSE 100

8,988

+0.6% (YTD: +10.1%)

Euro Stoxx 50

5,371

-0.2% (YTD: +9.7%)

Brent crude

USD 69.09

-1.8%

Natural gas (Nymex)

USD 3.45

+4.1%

Gold

USD 3,350

-0.4%

BTC

USD 120,159

+1.3% (YTD: +28.5%)

S&P Egypt Sovereign Bond Index

880.38

+0.1% (YTD: +13.2%)

S&P MENA Bond & Sukuk

145.86

-0.1% (YTD: +4.2%)

VIX (Volatility Index)

17.20

+4.9% (YTD: -0.9%)

THE CLOSING BELL-

The EGX30 rose 2.0% at yesterday’s close on turnover of EGP 4.6 bn (7.0% below the 90-day average). International investors were the sole net sellers. The index is up 13.4% YTD.

In the green: Eastern Company (+5.8%), Qalaa Holdings (+3.8%), and Beltone Holding (+3.5%).

In the red: Egypt Aluminum (-1.9%), Madinet Masr (-1.5%), and Rameda (-1.1%).

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