Discover more from Emerging World
Emerging Markets Daily - February 7
Vitol Cautious on Oil Rally, Emirates NBD Bullish on EM, China in New Tech Anti-Monopoly Push, Vietnam Stocks Surge, and Abu Dhabi Cuts Trading Fees
The Top 5 Emerging Markets Stories - February 7
Vitol Urges Caution on Oil Market Rally - Bloomberg/Gulf Intelligence
“The world’s largest independent oil trader, Vitol SA, joined rival Gunvor Group Ltd. in expressing caution about the recent surge in crude prices.”
“‘The market is getting ahead of itself in terms of a post-vaccine euphoria but also continued belief in the ability of OPEC to manage supply,’ Mike Muller, head of Vitol’s Asian operations, said Sunday in an interview with Dubai-based consultant Gulf Intelligence.
“Vaccines have been rolled out faster than energy markets predicted and China’s oil demand has rebounded rapidly, Muller said. But a full recovery depends on consumption elsewhere picking up, he said.”
“‘The onus is on the rest of the world to start with the demand catch-up because China can’t consume much faster than it’s already been doing,’ he said. ‘It’s already outstripping its 2019 numbers and growing at a phenomenal pace beyond most people’s expectations.’” Bloomberg reports.
Emirates NBD Bullish on Emerging Markets for 2021 - The National
“Dubai’s biggest bank favours investing in emerging markets and is bullish on potential growth of UAE stocks, as economic activity picks up in tandem with the Covid-19 vaccine rollout.”
"‘For us, there is no question, it is emerging markets,’ Maurice Gravier, chief investment officer at Emirates NBD group, said on Sunday. ‘They move faster, they have been less affected by the crisis as a group, thanks to China in particular, and they will rebound stronger [from the crisis].’”
“Emerging markets assets, along with gold were the best performers for the lender in 2020. Emirates NBD has increased the weight of emerging market equities in its portfolio to 15.4 per cent this year from 9 per cent level in 2018. The weight of developed market stocks has gone down to 19.6 per cent in 2021 from 26 per cent in 2018.”
"‘They, [emerging market stocks] are cheaper and have a huge valuation discount compared to developed markets, and they are less crowded.’”
“Emerging markets investments are expected to return 8.3 per cent annual gains over the next 10 years, compared to 5.9 per cent returns from the developed markets, Anita Gupta, head of equity strategy at the bank said, citing Emirates NBD’s own Capital Model estimates,” The National reports.
China Regulators Issue New Rules Targeting Tech Monopolies - Reuters
“China’s market regulator released new anti-monopoly guidelines on Sunday that target internet platforms, tightening existing restrictions faced by the country’s tech giants.”
“The new rules formalise an earlier anti-monopoly draft law released in November, and clarify a series of monopolistic practices that regulators plan to crack down on.”
“The guidelines are expected to put new pressure on the country’s leading internet services, including e-commerce sites such as Alibaba Group’s Taobao and Tmall marketplaces or JD.com. They will also cover payment services like Ant Group’s Alipay or Tencent Holding’s WeChat Pay.”
“The rules, issued by the State Administration for Market Regulation (SAMR) on its website, bar companies from a range of behaviour, including forcing merchants to choose between the country’s top internet players, a long-time practice in the market,” Reuters reports.
Vietnam Stocks A Top 5 Global Performer - VN Express Business
“Vietnam’s stock market was a top five global performer last week with a single session loss and four consecutive gaining sessions.”
“With a 6.65 percent increase to reach 1126.91 points, the VN-Index ranked fourth among the most active markets in the past week, according to StockQ.org.”
“The top three on the list were India, Russia and Italy with respective increases of 9.91 percent, 7.13 percent and 6.73 percent. Vietnam was followed by Spain, with its stock market gaining 6.17 percent last week,” VN Express Business News reports.
Abu Dhabi to Cut Trading Fees in Bid to Double Market Cap - Arab News
“The Abu Dhabi Securities Exchange (ADX) has announced plans to cut trading fees by 22 percent, one of a number of initiatives designed to boost activity and liquidity on the bourse.”
“The fee cut will come into effect from Feb. 14 as part of its new ADX One strategy to double the market capitalization of companies listed on the exchange by 2024.”
“It is the second time ADX has reduced fees, the previous cut being in June 2019. Under the new plan, fees of all transactions that occur on ADX will be reduced to 0.175 percent from 0.225 percent from Feb. 14.”
“In another initiative to boost trading volume, ADX brokerage firms that generate 20 million UAE dirhams ($5.45 million) or more in trading commission will be exempt from paying any trading commission fees for the year,” Arab News reports.