Turbulent times in infrastructure spending: Fund managers have expressed concerns over pouring funds in infrastructure projects due to “uncertainty over the outlook for green energy subsidies and tariffs, ahead of a US presidential election,” according to the Financial Times.

The why: Republican candidate Donald Trump’s return to office could possibly mean bidding farewell to incentives for domestic industry and clean tech under the Biden administration’s Inflation Reduction Act. This has put funds in a position where they can’t accurately cost or price a project. “We have to be more cautious over the next 12 months on committing to projects. There’s a bit of a stalling of momentum until we have more certainty around costs,” saud Quinbrook Infrastructure Partners Co-founder David Scaysbrook.

What’s next? Some asset managers expect a pick up in investment activity following election results in November, with the demand and need being there, while others expect some pullback.

Despite all this, investors continue to have an appetite for infrastructure funds: North American infrastructure funds raised some USD 10 bn during the first half of the year, a 150% y-o-y increase, in addition to another USD 7 bn raised between July and August. Investor appetite is expected to continue and even rise as fund managers view the funds as a safe haven for investors looking to put their funds in high-yielding assets ahead of upcoming rate cuts.

MARKETS THIS MORNING-

Asian markets are in the red in early trading this morning, as traders react to US big tech stocks falling the day before as Western markets get ready for Nvidia earnings out Wednesday. Japan’s Nikkei is down 0.3%, Korea’s Kospi is down 0.5%, and China’s Hang Seng is down 0.9%.

TASI

12,261

0.0% (YTD: +2.5%)

MSCI Tadawul 30

1,536

0.0% (YTD: -0.9%)

NomuC

26,434

-1.0% (YTD: +7.8%)

USD : SAR (SAMA)

USD 3.75 Sell

USD 3.75 Buy

Interest rates

6.5% repo

5.5% reverse repo

EGX30

30,134

+0.2% (YTD: +21.1%)

ADX

9,356

-0.2% (YTD: -2.3%)

DFM

4,325

+0.8% (YTD: +6.5%)

S&P 500

5,617

-0.3% (YTD: +17.8%)

FTSE 100

8,328

+0.5% (YTD: +10.8%)

Euro Stoxx 50

4,897

-0.3% (YTD: +8.3%)

Brent crude

USD 81.2

+2.8%

Natural gas (Nymex)

USD 1.96

-3.3%

Gold

USD 2,553.50

+0.3%

BTC

USD 63,414.90

-1.2% (YTD: +50.2%)

THE CLOSING BELL: TADAWUL-

The TASI was unchanged yesterday on turnover of SAR 9 bn. The index is up 2.5% YTD.

In the green: Al Baha (+8.3%), Al Akaria (+6.3%) and Spimaco (+5.0%).

In the red: Savola Group (-5.0%), Wafrah (-3.6%) and Herfy Foods (-2.9%).

THE CLOSING BELL: NOMU-

The NomuC was down 1.0% yesterday on turnover of SAR 35.9 mn. The index is up 7.8% YTD.

In the green: Al Razi (+7.3%), Naseej Tech (+6.3%) and Al Babtain Food (+5.9%).

In the red: Naba Al Saha (-13.4%), Rawasi (-10.7%) and Lana (-9.5%)

CORPORATE ACTIONS-

Alwasail Industrial will distribute SAR 12.5 mn in dividends at SAR 0.05 per share for 1H 2024, according to a filing to Tadawul. The distribution date is contingent upon general assembly approval.

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