The IMF sees slower MENA growth in the short term on the back of Saudi oil cuts: The International Monetary Fund downgraded its economic growth for the regional economy to 2.9% in FY 2023-24, marking a downward revision of 0.5% from its previous outlook in October, according to its latest update (pdf). This would be down from c. 2.0% economic growth in 2022,

Temporary oil cuts in Saudi Arabia, including those made as per OPEC+ decisions, were cited as the main factor behind the slashed outlook, while growth across non-oil sectors is expected to hold steady.

THE GLOBAL OUTLOOK-

On a global level, there’s slightly more optimism for 2024: The Fund’s global growth outlook for 2024 nudged higher to 3.1%, representing a 0.2% increase from its last prediction in October on the back of stronger-than-expected bounceback from the US and certain emerging markets, alongside fiscal support in China.

Next year’s projections are less rosy: Growth projections for 2025, however, dipped below the historical 3.8% average, to hit 3.2% as the Fund expects central banks to stick to monetary tightening. The Fund also cited high debt as a factor cutting into countries’ ability to provide fiscal support.

Global inflation is cooling faster than expected: Global headline inflation is thought to fall to 5.8% in 2024 and 4.4% in 2025, presenting a soft landing as a more achievable prospect. “On the downside, new commodity price spikes from geopolitical shocks––including continued attacks in the Red Sea––and supply disruptions or more persistent underlying inflation could prolong tight monetary conditions,” IMF chief economist Pierre-Olivier Gourinchas cautioned in the foreword.

ALSO WORTH NOTING- World’s largest sovereign fund had a bumper year: Norway's USD 1.6 tn sovereign wealth fund — the world’s largest — reported record gains of NOK 2.22 tn (USD 213 bn) over 2023, driven by strong returns on investments. This is a stark contrast to the record losses the fund saw in 2022. (Statement | CNBC)

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THE CLOSING BELL-

The DFM fell 0.1% yesterday on turnover of AED 346.8 mn. The index is up 2.7% YTD.

In the green: Takaful Emarat (+14.9%), Mashreq Bank (+13.2%) and Orascom Construction (+5.3%).

In the red: Al Firdous Holdings (-8.6%), Commercial Bank of Dubai (-6.4%) and National Central Cooling (Tabreed) (-3.6%).

Over on the DFM, the index closed down 0.3% on turnover of AED 1.5 bn, while the Nasdaq Dubai index fell 0.7%.

CORPORATE ACTIONS-

Tamween sells 3% stake in Apex Investment: Ghitha Holding subsidiary TamweenCompanies Management divested a 3% stake (106.6 mn shares) in Apex Investment, according to an ADX disclosure. The shares are worth AED 213.2 mn, Mubasher reports.

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