The Fed’s not done: The US Federal Reserve is expected this week to resume its tightening cycle by raising interest rates by another 25 bps and signal the possibility of more to come if inflation doesn’t come down to target, according to the Financial Times. The expected hike would take the fed funds rate target range to 5.25-5.5%, the highest since the aftermath of the dot-com bust in 2001, and comes in the wake of optimistic inflation that showed consumer prices growing at their slowest rate since March 2021.

The final hike? While the market is expecting this to be the Fed’s final hike, economists don’t see the central bank giving much away about its future options. “It’s unlikely that the committee would be willing to communicate that they expect to be on an extended hold,” one analyst told the salmon-colored paper. “There’s a great deal of scope for them to end up hiking more after the July meeting, if prompted by the data.”

ALSO WORTH NOTING-

  • Delivery Hero now fully owns Saudi subsidiary: German food delivery app Delivery Hero has taken full ownership of its Saudi subsidiary — HungerStation — by acquiring the remaining 37% it didn’t own for USD 297 mn. ( Company statement)
  • Inflation in Dubai slowed in June to its lowest level since early 2022, recording 2% on the back of a drop in transportation costs. ( Dubai Statistics Authority, pdf)
  • Eurozone downtown intensifies in July: A sharper-than-expected downturn in the eurozone manufacturing and services sectors caused the downturn in the bloc to deepen in June, according to flash PMI estimates. ( HCOB Flash Eurozone PMI, pdf)
  • UK inflation dips below 8%, giving BoE some relief: UK inflation fell to 7.9% in June, easing the pressure on the Bank of England to continue aggressively raising interest rates. ( Office for National Statistics)
  • US, UK hit Credit Suisse for Archegos collapse: Credit Suisse has been slapped with USD 388 mn of fines by US and UK regulators over the implosion of its hedge fund Archegos Capital in 2021. ( Financial Times)

EGX30

17,550

-0.2% (YTD: +20.2%)

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

11,802

+0.4% (YTD: +12.6%)

A D X

9,740

+1.2% (YTD: -4.6%)

DFM

3,994

+0.2% (YTD: +19.7%)

S&P 500

4,555

+0.4% (YTD: +18.6%)

FTSE 100

7,679

+0.2% (YTD: +3.0%)

Euro Stoxx 50

4,383

-0.2% (YTD: +15.5%)

Brent crude

USD 82.88

+2.2%

Natural gas (Nymex)

USD 2.70

-0.6%

Gold

USD 1,995.80

-0.5%

BTC

USD 29,140

-3.3 % (YTD: +76.2%)

THE CLOSING BELL-

The EGX30 fell 0.2% at yesterday’s close on turnover of EGP 1.18 bn (39% below the trailing 90-day average). Foreign investors were net sellers. The index is up 20.2% YTD.

In the green: Credit Agricole Egypt (+4.9%), Mopco (+2.2%) and CIB (+1.3%).

In the red: Ezz Steel (-4.3%), Egypt Kuwait Holding (-3.2%) and Ibnsina Pharma (-3.0%).

Asian markets are firmly in the green this morning, led by Chinese shares which are seeing gains after Beijing indicated it would step in to support the economy with fresh stimulus in the coming months. The news, together with increasing concern about market tightness, is pushing oil prices higher this morning. Elsewhere: Stock futures have European and US stocks falling at the opening bell today.

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