Fed could pause rate hikes in June: Federal Reserve officials are hinting that the central bank will keep rates unchanged for their upcoming meeting in two weeks before potentially raising them again at later meetings, Reuters reported. “Skipping a rate hike at a coming meeting would allow the [Federal Open Market] Committee to see more data before making decisions about the extent of additional policy firming,” Fed Governor Philip Jefferson said yesterday.

Investors are expecting rate cuts later this year: Following April’s inflation figuresinvestorswere expectingthe Fed to cut interest rates to 4.2% by the end of the year but have since revised their forecast to 4.7%.

Spiking interest rates to cause wave of defaults in US, Europe -Deutsche: Companies across the US and Europe will soon be hit with a “default wave” that won’t peak before 4Q 2024, according to a Deutsche Bank study picked up by Reuters. At its peak, default rates are expected to hit 9% for US high-yield debt, 11% for US loans, and 7% for European loans, mainly driven by the aggressive monetary tightening cycles adopted by many central banks in efforts to curb soaring inflation.

ALSO WORTH NOTING-

  • China recovery stumbles: China's factory activity contracted faster than expected in May due to lower demand, suggesting that its economic recovery from its strict covid-19 curbs could be losing steam. (Reuters)
  • UK firms are struggling with inflation: UK business confidence declined for the first time in three months on the back of persistent inflationary pressures, according to a survey. (Lloyds Business Barometer)

EGX30

17,496

-0.2% (YTD: +19.9%)

USD (CBE)

Buy 30.84

Sell 30.96

USD at CIB

Buy 30.85

Sell 30.95

Interest rates CBE

18.25% deposit

19.25% lending

Tadawul

11,014

-1.1% (YTD: +5.1%)

ADX

9,407

-0.8% (YTD: -7.9%)

DFM

3,577

+0.3% (YTD: +7.2%)

S&P 500

4,180

-0.6% (YTD: +8.9%)

FTSE 100

7,446

-1.0% (YTD: -0.1%)

Euro Stoxx 50

4,218

-1.7% (YTD: +11.2%)

Brent crude

USD 72.66

-1.2%

Natural gas (Nymex)

USD 2.26

-2.8%

Gold

USD 1,981.40

+0.2%

BTC

USD 27,119

-2.4% (YTD: +63.9%)

THE CLOSING BELL-

The EGX30 fell 0.2% at yesterday’s close on turnover of EGP 3.42 bn. Local investors were net buyers. The index is up 19.9% YTD.

In the green: Elsewedy Electric (+8.6%), Juhayna (+1.9%) and CIRA Education (+1.0%).

In the red: Orascom Construction (-6.7%), Abu Dhabi Islamic Bank (-6.5%), and Mopco (-3.0%).

Tags: