{"id":563996,"date":"2021-08-02T13:38:10","date_gmt":"2021-08-02T13:38:10","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/2021\/08\/02\/tonight-brace-for-august-turbulence-next-gen-covid-variants-could-emerge-from-england-also-esgs-are-leading-to-greenflation\/"},"modified":"2021-08-02T13:38:10","modified_gmt":"2021-08-02T13:38:10","slug":"tonight-brace-for-august-turbulence-next-gen-covid-variants-could-emerge-from-england-also-esgs-are-leading-to-greenflation","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/egypt\/2021\/08\/02\/tonight-brace-for-august-turbulence-next-gen-covid-variants-could-emerge-from-england-also-esgs-are-leading-to-greenflation\/","title":{"rendered":"TONIGHT: Brace for August turbulence. + Next-gen covid variants could emerge from England. ALSO: ESGs are leading to \u201cgreenflation\u201d."},"content":{"rendered":"

Good afternoon, ladies and gentlemen, and welcome to your capital markets-themed edition<\/strong>, with local and foreign headlines today being dominated by financial market news.<\/p>\n

THE BIG STORY TODAY- Egypt could expect to see up to USD 4 bn of foreign inflows into the bond market in 2H2021 <\/strong>should Egypt\u2019s debt be made \u201cEuroclearable\u201d and make the JPM EM index later this year, Beltone Financial\u2019s chief economist Alia Mamdouh told Bloomberg Daybreak this morning.<\/p>\n

In other capital market news, new details have emerged concerning the EGP 1 bn fund-of funds <\/strong>being launched by Egypt\u2019s state-owned banks. For one, the fund will be launched in the fourth quarter of this year, with US-based Avanz Capital having been hired to manage the fund.<\/p>\n

Meanwhile, Mubasher Capital appears to be growing its asset management business significantly over the next 2-3 years,<\/strong> with plans to launch 10 debt and equities funds. We have details on these stories in the Speed Round below.<\/p>\n

<\/a> THE BIG STORY ABROAD- <\/strong> Prepare for a turbulent August in the financial markets.<\/strong> August is normally a difficult time in the markets, but this year fears over the delta variant could add fuel to the fire, with volatility markets beginning to flash yellow. The VIX has seen its lows gradually tick up through the month of July and high-yield spreads are becoming \u201cstickier\u201d \u2014 two \u201cyellow warning lights\u201d that could signpost trouble ahead, the head of one US research firm has warned, according to Bloomberg<\/a>.<\/p>\n

And that\u2019s not all:<\/strong> Another measure of risk \u2014 the S&P 500 Skew \u2014 has reached its highest point since the pandemic erupted 18 months ago. The Skew, which compares bullish and bearish options trades, is elevated despite the benchmark index reaching a new record high last week.<\/p>\n

\u201cThere is worry but we are nowhere near peak worry,<\/strong>\u201d a strategist at the Royal Bank of Canada told the business news information service.<\/p>\n

Delta is also messing with oil prices<\/strong>, as the new variant\u2019s impact on demand across the Asia-Pacific region made itself felt in a price drop following two weeks of gains. Brent futures dropped 87 cents to USD 74.54 as of 11:45 AM London time, while US crude lost USD 1 to hit USD 72.95 a barrel, according to Reuters<\/a>.<\/p>\n

Fears over an economic slowdown in China are also driving the selling pressure:<\/strong> Manufacturing activity in China grew at its weakest pace<\/a> since the start of the pandemic last month due to rising raw materials prices and bad weather, while a fresh covid outbreak<\/a> is raising the prospect of further economic disruption this month.<\/p>\n

** CATCH UP QUICK on the top stories from today\u2019s EnterpriseAM:<\/strong><\/p>\n