The global sukuk market fell 15% y-o-y to USD 101.3 bn during the first half of 2025, S&P Global Ratings said in a report. The ratings agency expects sukuk to be instrumental in financing countries heavily reliant on oil revenues, with expectations that oil prices will average USD 60 bbl/d this year, and USD 65 next year.

Foreign currency sukuk issuances grew 9% to reach USD 41.4 bn in 1H, during the period, as banks and corporates tapped Islamic capital markets for expansion funding amid strong economic conditions. The uptick was led by a rise in issuances in the UAE, Kuwait, and Bahrain, while Saudi Arabia saw a small decline.

Holding the line: The ratings agency expects the upward foreign currency issuances trend to continue for the rest of the year, accounting for USD 70-80 bn in 2025. The regional geopolitical situation is not expected to see escalation, and the US Federal Reserve’s expected interest rate cut should also bolster the market.

A different story for local issuances: Local currency issuances shed 26.2% to log USD 59.8 bn in 1H, expected to continue its downward trend in the second half of the year. The decline was attributed to lower local currency issuances in core markets, most notably in government issuances from Saudi Arabia, where liquidity is channeled into financing Vision 2030 projects. Malaysia is also seeing lower borrowing needs after it managed to reduce financial deficits.

MEANWHILE- Sustainable sukuk issuance rose by 27% y-o-y to USD 9.3 bn, with banks accounting for 50% of issuance volumes, while Saudi Arabian issuers accounted for 60%. The rise was aided by the “significant” role of the Islamic Development Bank, and the high financing needs of Saudi banks.

MARKETS THIS MORNING-

Asian markets are mixed this morning, after US President Trump signaled he won’t budge on the 1 August tariffs deadline. Hong Kong’s Hang Seng is down 0.8%, while Japan’s Nikkei remains unchanged, and the Shanghai Composite is up 0.3%. Meanwhile, Wall Street futures are holding steady as investors wait for more clarity on the tariffs situation.

TASI

11,294

-0.5% (YTD: -6.2%)

MSCI Tadawul 30

1,449

-0.4% (YTD: -3.9%)

NomuC

27,344

-0.4% (YTD: -13.1%)

USD : SAR (SAMA)

USD 3.75 Sell

USD 3.75 Buy

Interest rates

5.0% repo

4.5% reverse repo

EGX30

33,038

+0.4% (YTD: +11.1%)

ADX

10,012

+0.1% (YTD: +6.3%)

DFM

5,794

-0.1% (YTD: +12.3%)

S&P 500

6,226

-0.1% (YTD: +5.9%)

FTSE 100

8,854

+0.5% (YTD: +8.3%)

Euro Stoxx 50

5,372

+0.6% (YTD: +9.7%)

Brent crude

USD 70.02

+0.6%

Natural gas (Nymex)

USD 3.34

-2.1%

Gold

USD 3,317

-0.8%

BTC

USD 108,711

+0.5% (YTD: +16.1%)

Sukuk/bond market index

911.39

0.0% (YTD: +1.0%)

S&P MENA Bond & Sukuk

145.83

0.0% (YTD: +4.2%)

VIX (Volatility Index)

16.81

-5.5% (YTD: -3.1%)

THE CLOSING BELL: TADAWUL-

The TASI fell 0.5% yesterday on turnover of SAR 5.3 bn. The index is down 6.2% YTD.

In the green: Cenomi Centers (+7.6%), Arabian Drilling (+5.7%) and Teco (+5.5%).

In the red: Baan (-4.4%), Cenomi Retail (-3.9%) and Riyadh Cables (-3.8%).

THE CLOSING BELL: NOMU-

The NomuC fell 0.4% yesterday on turnover of SAR 19.0 mn. The index is down 13.1% YTD.

In the green: iOud (+7.3%), Knowledge Tower (+6.1%) and Alhasoob (+5.7%).

In the red: Amwaj International (-8.7%), NGDC (-8.2%) and Jana (-7.9%).

CORPORATE ACTIONS-

Banan Real Estate’s board of directors decided to distribute SAR 5 mn in cash dividends for 2H 2024 at SAR 0.025 apiece starting Tuesday, 19 August, according to a disclosure to Tadawul.

Tags: