Market hype over the Fed’s interest rate position is tempering: The so-called “meltup” in the financial markets that accompanied statements made by the chair of the Federal Reserve last week stuttered in the week’s first day of trading yesterday, with stocks falling, US yields rising, and gold falling back from record highs. Risk assets soared last week on hopes that the US central bank would begin to cut interest rates sooner than expected.

Oil resumes slide on supply-cut skepticism: Oil traders yesterday continued to pour cold water on the fresh voluntary supply cuts announced by OPEC+ last week, with Brent and US crude futures both falling back during trading. Brent closed the session 1.7% lower while WTI lost 2.0% as traders expressed doubts that the measures would be enough to support prices.

ICYMI- Several members of the alliance of oil producing countries last week voluntarily agreed to remove c. 2.2 mn barrels per day from the global market in 1Q 2024, with Russia committing to an additional 500k bpd cut and Saudi Arabia rolling over its 1 mn bpd reduction into 2024.

One corner of the markets that isn’t listening: Crypto, where BTC and other tokens continued to soar yesterday despite a pullback in other asset classes. BTC surpassed USD 42k for the first time since April 2022, leaving it up 150% year-to-date and putting it on track for its biggest annual gain since 2020, according to Bloomberg.

Driving the frenzy: The typical volatility in the crypto markets is being intensified by anticipation that US regulators will approve the launch of BTC exchange-traded funds.

ALSO WORTH NOTING- Qatar wealth fund slashes Barclays stake: The Qatar Investment Authority is selling almost half its shares in Barclays in a move expected to raise almost USD 650 mn. The wealth fund is one of the British lender’s largest shareholders with a 5.3% stake, and is planning to sell more than 360 mn shares. (Bloomberg | Financial Times)

TASI

11,191.39

-0.3% (YTD: +6.8%)

MSCI Tadawul 30

1,440.49

-0.4% (YTD: -21.7%)

USD : SAR (SAMA)

3.75

–

Interest rates

6% repo

5.5% reverse repo

EGX30

25,265

+2.8% (YTD: +73.1%)

ADX

9,539.08

-0.2% (YTD: -6.6%)

DFM

3,987.75

-0.1% (YTD: +19.5%)

S&P 500

4,562.22

-0.7% (YTD: +18.9%)

FTSE 100

7,512.96

-0.2% (YTD: +0.8%)

Euro Stoxx 50

4,414.95

-0.1% (YTD: +16.4%)

Brent crude

USD 78.29

-0.8%

Natural gas (Nymex)

USD 2.68

-4.8%

Gold

USD 2,041.40

-2.3%

BTC

USD 41,733.79

+5.5% (YTD: +135.7%)

THE CLOSING BELL-

The TASI fell 0.3% yesterday on turnover of SAR 5.4 bn. The index is up 6.8% YTD.

In the green: Al Rajhi Takaful (+10%), Al Baha (+7.1%) and Gasco (+7.1%).

In the red: Naseej (-4%), Enaya (-3.1%) and Wafrah (-2.8%).

It’s a sea of red across Asian markets this morning, with CNBC suggesting that investors are at something of a pause point as they take stock of mixed economic data on Asian and global economies. Futures suggest markets across Europe and North America will follow suit at the opening bell later today.

CORPORATE ACTIONS-

Al Rajhi Takaful ups capital by 150%: The shareholders of Al Rajhi Cooperative Ins. Company (Al Rajhi Takaful) approved a capital increase of 150% to SAR 1 bn from SAR 400 mn, it said in a disclosure (pdf) to Tadawul yesterday. The capital hike increase will be executed through the capitalization of SAR 600 mn from the retained earnings account by granting 1.50 bonus shares for each share.

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