MAF Revenue falls in H1 as pandemic bites

MAF Revenue falls in H1 as pandemic bites
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Updated 23 August 2021

MAF Revenue falls in H1 as pandemic bites

MAF Revenue falls in H1 as pandemic bites
  • Revenue fell by 10 percent to AED 15.6 billion
  • MAF says confidence has returned in recent months as pre-pandemic activities resume

Majid Al Futtaim, the shopping malls, communities, retail and leisure group with a presence across the Middle East, Africa, and Central Asia, felt the impact of the pandemic as revenue fell by 10 percent to AED 15.6 billion, it revealed in its financial results for the first six months of the year. 

The Group said it has remained resilient and focused on adapting to customer needs despite the pandemic’s continued impact on its operating environment, reporting EBITDA of AED 1.6 billion, an increase of 2 percent and net profit after tax amounted to AED 662 million and total equity saw a marginal increase. This the group said was primarily due to the relative stabilisation in the market, resulting in steady asset valuations.

Alain Bejjani, Chief Executive Officer of Majid Al Futtaim - Holding, said: “Despite the prolonged impact of the COVID-19 pandemic, Majid Al Futtaim has delivered a robust performance over the first half of the year, driven by prudent financial management and a diversified portfolio."

He added that the company's strong financial position has enabled it to remain resilient to that pressure and agile in how it responded to the situation. 

As the pandemic wanes in key markets across the globe, Bejjani, said confidence has returned in recent months and pre-pandemic activities were seeing a resumption.

“Over the first half of the year, we have seen encouraging signs of recovery across our markets, as consumers gain confidence. In addition to the increased activity across our physical assets, the acceleration of pre-pandemic trends – particularly as they pertain to digital capabilities – continues to gather pace," Bejjani added.

The group added that investment in sustainable growth opportunities would continue, saying it was on track to deliver on both its commitment to become Net Positive in water and energy by 2040 as well as its pledge to phase out single-use plastic across its operations by 2025.

Bitcoin slips from record high as ETF mania subsides

Bitcoin slips from record high as ETF mania subsides
Updated 22 October 2021

Bitcoin slips from record high as ETF mania subsides

Bitcoin slips from record high as ETF mania subsides
  • JPMorgan analysts doubted whether the ETF will attract much new money into bitcoin

RIYADH: Cryptocurrencies declined on Friday following an ETF-fueled rally that saw it reach a record $67,016 on Wednesday, as investors questioned whether the new investment vehicle will attract as much new money to the assets as some have speculated.

Bitcoin, the world’s largest cryptocurrency, was trading at $63,498.16 as of 3:36 p.m. in Riyadh, a drop of 2.5 percent over the previous 24 hours. Ethereum, was 2.0 percent lower at $4,125.40 after approaching its all-time high of $4,380 from May.

Bitcoin’s recent rally — six-months after its previous top of $64,895 — was fueled by the debut of the ProShares Bitcoin Strategy ETF.

A dozen other futures-based bitcoin ETFs could launch in the coming months, with The Valkyrie Bitcoin Strategy ETF set to begin trading on Friday under the ticker BTF. The VanEck Bitcoin Strategy ETF expected to begin trading next week under the ticker XBTF.

Investors have bet the long-awaited launch of bitcoin ETFs will lead to greater investment from both retail and institutional investors, but analysts at JPMorgan suggested in a note that the ProShares ETF could have limited effect on investment volumes because there are so many options for investors already.

The ProShares ETF has created a significant shift in the balance of power among cryptocurrency exchanges. The Chicago Mercantile Exchange (CME), host to the ETF, has replaced Binance as the world’s biggest bitcoin futures platform this week.

As of 2 p.m. Riyadh time, the CME accounted for 22 percent, or $5.68 billion, of the total global futures open interest of $25.7 billion, while Binance contributed $5.66 billion, CoinDesk reported.

The value of funds held in CME-based futures contracts have tripled this month, with more than $1.5 billion flowing into the market after ProShares’ bitcoin ETF went live on Tuesday, CoinDesk said.

Elsewhere in the cryptoverse, Worldcoin said yesterday it raised $25 million from investors including Andreessen Horowitz, CoinBase Ventures and Digital Currency Group, valuing it at $1 billion.

The rather unique proposition is that coins are distributed in exchange for staring into an orb, which takes a scan of your retinas.

Based in Berlin, Worldcoin was founded by former Y Combinator President Sam Altman. It currently has 70 employees and 30 orbs, which it takes out into the world to offer worldcoins. It plans to ramp up orb production to 4,000 per month from November.

So far, about 130,000 people have stared into the orb, has a cap of 10 billion coins with the aim of giving one to every person on earth with the remaining 2 billion set aside for the Worldcoin Foundation and investors.

Oil stays near $85 a barrel, Brent set for seventh weekly gain

Oil stays near $85 a barrel, Brent set for seventh weekly gain
Image: Shutterstock
Updated 22 October 2021

Oil stays near $85 a barrel, Brent set for seventh weekly gain

Oil stays near $85 a barrel, Brent set for seventh weekly gain
  • Prices have been boosted by worries about coal and gas shortages in China, India and Europe

Oil prices stayed near multi-year highs on Friday, erasing some earlier losses in Asian trading hours, with concerns about tight supply and stockpiles fuelling bullish sentiment.

Brent crude futures rose 23 cents, or 0.3 percent, to $84.84 a barrel at 0933 GMT, after Thursday's three-year high of $86.10. The benchmark is set for its seventh weekly gain.

U.S. West Texas Intermediate (WTI) crude futures gained 20 cents, or 0.2%, to reach $82.70 a barrel, not far off a seven-year high hit this week.

Prices have been boosted by worries about coal and gas shortages in China, India and Europe, spurring some power generators to switch from gas to fuel oil and diesel.

Winter weather in much of the United States is expected to be warmer than average, according to a National Oceanic and Atmospheric Administration forecast.

"Crude oil's sharp rise may make it vulnerable to profit taking, however, a substantial correction may not happen unless global energy crisis subsides," said Ravindra Rao, vice president for commodities at Kotak Securities.

"Global gas and coal prices have eased but concerns persist with tighter market and higher demand winter season around the corner."

U.S. crude found support this week as investors eyed low crude stocks at the U.S. storage hub in Cushing, Oklahoma.

U.S. Energy Information Administration data on Wednesday showed crude stocks at Cushing fell to 31.2 million barrels, their lowest level since October 2018.

"America’s gasoline demand appears to be experiencing an Indian summer," PVM analysts said in a note, pointing to the highest implied demand for this time of year since 2007 despite high pump prices.




Equities eye third week of gains after tech boost, S&P 500 hits new record

Equities eye third week of gains after tech boost, S&P 500 hits new record
Image: Shutterstock
Updated 22 October 2021

Equities eye third week of gains after tech boost, S&P 500 hits new record

Equities eye third week of gains after tech boost, S&P 500 hits new record

Global shares were on course for their third straight week of gains on Friday, buoyed by tech stocks in Asia overnight, while the dollar dipped and oil prices held steady.

MSCI's broadest gauge of global shares was up 0.1 percent in early European trade, 1.4 percent higher on the week and just 0.8 percent off its all-time high.

Germany's DAX gained 0.4 percent to 15,535.16. In Paris, the CAC 40 jumped 1.1 percent to 6,759.46, while Britain's FTSE 100 added 0.4 percent to 7,220.57.

The future for the S&P 500 was nearly unchanged while the future for the Dow industrials gained less than 0.1 percent.

On Thursday, the S&P 500 rose 0.3 percent to 4,549.78, its seventh straight gain. That eclipsed the record high it set on Sept. 2. 

That followed gains in Asia, where equity bulls were also comforted by news that heavily indebted Chinese property firm China Evergrande Group had made a surprise interest payment, averting a default for now.

Japan's Nikkei advanced 0.3 percent, led by the technology sector, while energy and basic materials shares were the biggest drags as coal futures extended their losses after Beijing signalled it would intervene to cool surging prices that contributed to the country's electricity shortage.

More broadly, investors have become increasingly concerned that persistent inflation could force central bankers to tighten monetary policy at a point where global economic growth remains fragile.

Mark Haefele, Chief Investment Officer, UBS Global Wealth Management, said in a note to clients that equities could still move higher, despite growing concerns around the impact of inflation and the potential for central banks to tighten policy.

"With current issues still appearing more temporary than structural, we believe equity markets will continue to move higher," Haefele said.

"Indeed, small increases in inflation expectations can be positive for markets if it helps to banish fears of deflation. Furthermore, by our assessment, global growth remains strong, supply chain challenges should recede into 2022, and corporate earnings should continue to grow."

U.S. stock futures point to a 0.1 percent lower open, after the cash index posted a record closing high overnight, led by surging tech shares.

Next week, Facebook, Apple, Amazon, and Google-owner Alphabet all report, with bulls hoping they can follow forecast-beating earnings this week from Netflix.

Meanwhile, yields on benchmark 10-year Treasury notes were at 1.6828 percent, easing back from a five-month high of 1.7050 percent reached overnight.

The dollar index, which gauges the greenback against six major rivals, was down 0.1 percent to 93.639 on Friday, despite initially bouncing off recent lows after U.S. jobless claims fell to a 19-month low, pointing to a tighter labor market.

The Fed has signalled it could start to taper stimulus as soon as next month, with rate hikes to follow late next year. Full employment is among the Fed's stated requirements for rates lift-off.

Fed Chair Jerome Powell speaks later on Friday in a panel discussion.

Across commodities, oil was flat with Brent crude set for its first losing week in seven and West Texas Intermediate its first in nine.

Gold was up 0.5 percent on the back of the weaker dollar, on course for its second week of gains.

STV eyes $1 billion for second Middle East tech fund

STV eyes $1 billion for second Middle East tech fund
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Updated 22 October 2021

STV eyes $1 billion for second Middle East tech fund

STV eyes $1 billion for second Middle East tech fund
  • Interest in the technology industry in the Middle East has increased the past few years as governments seek to diversify their energy-dependent economies

RIYADH: STV, the venture capital arm of Saudi Telecom founded by ex-Google executive Abdulrahman Tarabzouni, is looking to raise at least $1 billion for its second Middle East technology investment fund, making it potentially the biggest fund of its kind in the region.

The company, which was formed in 2017, has started talks with other potential backers, including Middle East sovereign wealth funds and international pension funds and endowments, Bloomberg reported, citing people familiar with the matter.

The people chose to remain anonymous as the details of the fund remain private. STV declined to comment.

Interest in technology has grown significantly with most governments within the region seeking to diversify away from dependency on oil and investors seeking long-term opportunities.

IPOs in the region have also recently taken prominence with Adnoc Drilling coming to the market as the largest IPO on the Abu Dhabi stock market.

STV was an early investor in Careem, which was acquired by Uber in early 2020, and also invested in communications platform Unifonic, which received a $125 million infusion led by SoftBank Group’s Vision Fund 2 in September.

STV took part in 30 percent of all start-up funding rounds in Saudi Arabia and 20 percent in the wider Middle East in recent years, its CEO Abdelrahman Tarabzouni said in June.

Founded in 2017, it invested in 12 funding rounds in Saudi Arabia and the Middle East during the previous nine months, compared with seven rounds during the previous two years, Tarabzouni said.

The venture capital firm, which has a portfolio of $500 million, is considering launching a second fund to invest in the growth of emerging companies and lead advanced rounds in them, he said.

Studies conducted by STV showed that there is an opportunity to create 40 unicorn companies in the Middle East and North Africa (MENA) and Saudi Arabia will have the lion’s share of these companies.

China coal prices dive as govt plans intervention to ease power crunch

China coal prices dive as govt plans intervention to ease power crunch
Updated 22 October 2021

China coal prices dive as govt plans intervention to ease power crunch

China coal prices dive as govt plans intervention to ease power crunch
  • China thermal coal prices plunge 12.8 percent

BEIJING: China’s thermal coal futures sank about 13 percent on Friday, extending their losses since Tuesday when Beijing said it would intervene to cool surging prices of the commodity to help electricity producers out of a widespread power crunch.
The most-active thermal coal futures on Zhengzhou Commodity Exchange, for delivery in January, tumbled to 1,384 yuan per ton by 1130 Beijing time (0329 GMT) — down more than 30 percent since Tuesday’s all-time peak of 1,982 yuan per ton.
Coking coal was down 9.91 percent and coke futures fell 7.42 percent on the Dalian Commodity Exchange in morning trade, having fallen by the maximum 12 percent in day-time trade on Thursday.
A widening power crisis in China caused by shortages of coal led to record high fuel prices amid booming post-pandemic industrial demand as the country shifts to greener fuels.
China has halted production at factories which has dragged on factory gate inflation.
China is pushing miners to ramp up coal production and increasing imports so that power stations can rebuild stockpiles before the winter heating season, but analysts say shortages are likely to persist for at least another few months.
“We’re now seeing the fruits of China’s supply response, as the government has given miners carte blanche to produce at full tilt — even permitting the relaxation of safety inspections in some cases,” said Atilla Widnell, managing director at Navigate Commodities in Singapore.
“The parabolic pricing action largely represented the fear of buyers being unable to source sufficient volumes to feed power plants and coke ovens,” Widnell said.
“Therefore, we can expect prices to fall almost as fast as they’ve risen now that a wave of supply is inbound,” he added.

China’s state planner, the National Development and Reform Commission (NDRC), said this week that it was studying ways to lower coal prices and would take all necessary steps to bring them into a reasonable range.
The NDRC said on Friday it would send teams of inspectors to major coal producing regions to probe the costs of coal production and circulation.
It added that it had met with the China Coal Industry Association and key firms, and was looking at steps to prevent coal companies from seeking excessive profits.
China’s securities regulator has said it would ask futures exchanges to raise fees, restrict trading quotas and crack down on speculation in response to high coal prices.
The NDRC “has concluded that the unbridled soaring of coal prices is partly driven by those hoping to hit the jackpot by taking advantage of the power supply falling short of actual need,” Chinese state media outlet China Daily wrote on Thursday.
There should be “zero tolerance to the hoarding of coal,” the newspaper added. “It is of the utmost importance to rein in coal prices as they will pose a threat to people’s daily lives when winter sets in.”
Due to cold winds and rain, temperatures in most parts of central and eastern China are currently lower than normal, the National Meteorological Center said.