Bitcoin, ether near multi-month lows following hawkish Fed minutes

Bitcoin, ether near multi-month lows following hawkish Fed minutes
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Updated 06 January 2022

Bitcoin, ether near multi-month lows following hawkish Fed minutes

Bitcoin, ether near multi-month lows following hawkish Fed minutes

RAYANA ALQUBALI

RIYADH: Bitcoin fell below $42,000 on Thursday, testing multi-month lows after minutes from the Federal Reserve's last meeting showed it leaning toward more aggressive policy action, which sapped investor appetite for riskier assets.

The world's largest cryptocurrency was last at $42,784, down 7.44 percent, having lost 5.2 percent on Wednesday.

A break below last month's trough of $42,000 would make it the weakest since September.

“Although sharp, the most recent pullback in the digital asset market was by no means unexpected. Previously, we warned that uncertainty in the markets and weak technical fundamentals made a drop to low $40k levels entirely possible,” Mikkel Morch, Executive Director & Risk Management at crypto/digital assets hedge fund ARK36 said.

“In addition, we have recently seen a steep rise in open interest to levels that in the past were conducive to setting off a cascade of liquidations should the price drop below a key support level. This is precisely what happened this time around as well,” Morch added.

“After the release of the Fed’s December meeting minutes, hinting at a more decisive move to scale back its expansionary monetary policy to tackle inflation, negative investor sentiment caused Bitcoin to lose the key $46k level. Once that support was breached, liquidations followed within minutes.”

The fall “correlated with the risk off move across most traditional asset classes,” said Matt Dibb, COO of Singapore-based crypto fund distributor, Stack Funds, pointing to the declines in the Nasdaq in particular.

Moves in cryptocurrency markets are becoming more aligned with those in traditional markets as the number of institutions trading both crypto and other assets grows.

The Nasdaq plunged more than 3 percent overnight in its biggest one-day percentage drop since February. Fed minutes had showed US policymakers had discussed reducing the bank's balance sheet at their December meeting, when they also decided to accelerate finishing their bond buying programme.

Share markets in Asia sold off on Thursday as well, while US Treasury yields edged higher.

Ether, the world's second-largest cryptocurrency which underpins the ethereum network, lost 5.2 percent on Wednesday, and touched its lowest level since October, before bouncing back slightly to $3,460.

Crypto analysts were also watching to see whether anti-government protests in Kazakhstan, which were initially sparked by rising fuel prices, would affect the Bitcoin network.


Saudi Arabia scores record leap in UN’s E-Government Development Index ranking

Saudi Arabia scores record leap in UN’s E-Government Development Index ranking
Updated 16 sec ago

Saudi Arabia scores record leap in UN’s E-Government Development Index ranking

Saudi Arabia scores record leap in UN’s E-Government Development Index ranking

RIYADH: Saudi Arabia has achieved the highest leap in the UN’s E-Government Development Index since its inception more than 20 years ago. 

The Kingdom has advanced 12 places, to be ranked 31st this year, compared to 43rd in 2020, the Saudi Press Agency reported.

The index is considered to be an important international indicator that measures the extent of the development of digital governments in the areas of electronic services, communications, infrastructure and human capital worldwide.

The results of the EGDI were announced on Wednesday on the sidelines of the UN’s General Assembly in New York.

The Saudi Minister of Communications and Information Technology attributed the leaps to the efforts of the government agencies, and the adoption of modern digital solutions by launching many initiatives and products to serve the beneficiaries.

The Kingdom came among the best countries in the world in terms of providing government services information and sharing open government data to citizens and business sectors by 100 percent.

The report also praised the maturity of government digital organizations, reaching 96 percent, and the quality of digital specifications for government services, which scored  94 percent.

The availability and spread of digital government services reached 81 percent.

Saudi Arabia advanced 23 places globally in participation and electronic consultations directed to individuals and business sectors to explore their views on legislation and regulations with economic and social impact.

In February, digital transformation spending by Saudi Arabia reached SR12 billion ($3.19 billion) a year, according to Turki Al-Manea, executive director of investment at the Kingdom’s Digital Government Authority.

The money is being invested in cloud computing, new emerging technologies, and open source government software, Alarabiya reported.


Volkswagen prices Porsche shares at top tier range on strong demand

Volkswagen prices Porsche shares at top tier range on strong demand
Updated 22 min 26 sec ago

Volkswagen prices Porsche shares at top tier range on strong demand

Volkswagen prices Porsche shares at top tier range on strong demand

RIYADH: Volkswagen-owned Porsche is set to price its initial offering of stock at the high end of the planned range, Bloomberg reported

The share price was set at $80 per share, valuing the company at $73 billion, as it aims to pull off Europe’s largest initial public offering in a decade despite the turmoil in capital markets.

Porsche opens its Frankfurt stock market trading on Thursday, Sep. 29, for the first time.

The sale will help Volkswagen fund its electrification push, while investors get an emotional brand akin to Ferrari NV, which also separated from parent Fiat in 2015.

“If you can pull off an IPO in such a difficult market, it shows the attractiveness of the business,” Jefferies analyst Philippe Houchois told Bloomberg.

“Porsche is a mature, well-known business that doesn’t need to raise capital. Putting it on the market as a fully formed business –- being able to pull that off is quite impressive.”

The company is targeting revenue of up to $37 billion this year and a return on sales of up to 18 percent, up two percentage points from last year. Returns are to climb above 20 percent in the long term.


Saudi Arabia's ACWA Power’s investment exceeds $67m: CFO

Saudi Arabia's ACWA Power’s investment exceeds $67m: CFO
Updated 28 min 56 sec ago

Saudi Arabia's ACWA Power’s investment exceeds $67m: CFO

Saudi Arabia's ACWA Power’s investment exceeds $67m: CFO

RIYADH: Saudi Arabia’s utility developer ACWA Power currently holds over a $67 billion investment portfolio, revealed its chief financial offier.

The company, which builds power and desalinated water plants, currently has 60 percent of its projects in progress and 40 percent in development stages.

In the UAE, it has invested $10 billion in renewable energy, water desalination, and clean gas projects, Abdulhameed Al-Muhaidib told CNBC Arabia.

It is expected that the financial results for these projects will be announced this year, he added.


Chinese government to sell sovereign bonds worth $340bn by year-end

Chinese government to sell sovereign bonds worth $340bn by year-end
Updated 29 September 2022

Chinese government to sell sovereign bonds worth $340bn by year-end

Chinese government to sell sovereign bonds worth $340bn by year-end

RIYADH: China will sell sovereign bonds totalling $340 billion in the final months of this year as the Asian giant taps the remaining annual quota and refinances maturing special bonds.

The government has issued 1.09 trillion yuan ($151 billion) of general bonds so far this year ⁠— less than 40 percent of the budgeted central deficit of 2.75 trillion yuan for 2022, Bloomberg reported based on its calculations.

According to the report, the government is expected to issue a total of 2.45 trillion yuan in sovereign bonds between October and December, which comprises 1.66 trillion yuan of new bonds and 786 billion yuan to refinance maturing special debts.

Meanwhile, Reuters, citing people familiar with the matter, said that the treasury bond issuance plan was made during a meeting of the finance ministry on Wednesday.

According to the Reuters report, the ministry also urged local governments to complete issuing the roughly 500 billion yuan in special bonds by the end of October under carryover quotas from previous years, the sources said.

The issuance of a total of 3.45 trillion yuan in local government special bonds for infrastructure has been completed by the end of June.

Amid weak consumption recovery and softening export growth, authorities are doubling down on an infrastructure push, dusting off an old playbook by issuing debt to fund big public works projects to revive the economy.

China’s economy generally recovered and stabilized in the third quarter and the country will push ahead with its economic program in the fourth, state media quoted Li Keqiang, premier of the State Council of the People’s Republic of China, as saying on Wednesday.

But with few signs China will significantly ease its zero-COVID policy soon, many analysts expect the economy to grow by just 3 percent this year, which would be the slowest since 1976, excluding the 2.2 percent expansion during the initial COVID hit in 2020.

(With input from Reuters)


Capricorn Energy drops Tullow merger plan in favor of Israel’s NewMed

Capricorn Energy drops Tullow merger plan in favor of Israel’s NewMed
Updated 29 September 2022

Capricorn Energy drops Tullow merger plan in favor of Israel’s NewMed

Capricorn Energy drops Tullow merger plan in favor of Israel’s NewMed

LONDON: Capricorn Energy plans to merge with Israel’s NewMed in an all-share deal after paying a $620 million special dividend to its shareholders, ditching a previous scheme to merge with Tullow Oil, according to Reuters.

The Capricorn-NewMed deal would create an Israel-Egypt focused gas producer including NewMed’s stake in Israel’s giant Leviathan offshore field at a time when Europe is looking for non-Russian energy supplies.

The new group would be listed under NewMed, formerly known as Delek Drilling, in London and led by Yossi Abu, the CEO of NewMed whose shareholders will own 89.7 percent of the merged entity.

Capricorn’s shares were trading up more than 10 percent after the announcement, hitting their highest since 2018. Tullow’s shares were down about 3.6 percent and NewMed down just under 1 percent.

Abu, in a call with Reuters, said the new group would aim to double its production to 200,000 barrels oil equivalent per day by the end of the decade from its current 115,000 boed.

“We are creating a company that for the first time allows international investors to get direct exposure to the East Med gas play and Leviathan in particular,” Abu said.

It will be the first Israeli company to own oil and gas assets in Egypt, a neighboring Arab state with a peace treaty with Israel and an energy-hungry population of around 100 million.

Israel already supplies gas to Egypt after discovering large resources off its coast in the 2000s.

The deal would value Capricorn shares at 271 pence, a 13 percent premium to its last closing price. The deal with West Africa-focused Tullow, which declined to comment on Thursday’s news, had valued Capricorn at around 210 pence per share.

Some Capricorn investors had come out against the Tullow merger plan.

“Capricorn and NewMed are pleased to announce a proposed combination to create a MENA (Middle East and North Africa) gas and energy champion and one of the largest upstream energy independents listed in London,” Capricorn said.

The merger would see Capricorn issue new shares to NewMed investors based on an exchange ratio of around 2.34 per NewMed share, which will see Capricorn shareholders hold just over 10 percent of the new company.

Capricorn’s Chief Financial Officer James Smith will stay on with NewMed Energy, which is set to pay out at least 30 percent of its cah flow in dividends.