Macrosnapshot — Germany’s economy in trouble; Japan household spending falls

German inflation hit its highest level in more than four decades in April, pushed higher by a spike in the price of natural gas and mineral oil products since Russia’s invasion of Ukraine. Reuters
German inflation hit its highest level in more than four decades in April, pushed higher by a spike in the price of natural gas and mineral oil products since Russia’s invasion of Ukraine. Reuters
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Updated 11 May 2022

Macrosnapshot — Germany’s economy in trouble; Japan household spending falls

Macrosnapshot — Germany’s economy in trouble; Japan household spending falls

RIYADH: A halt to Russian gas supplies to Germany would trigger a deep recession and cost half a million jobs, a senior economist said in an interview published on Tuesday, as Europe’s biggest economy tries to cut Russian energy imports.

Achim Truger, a member of Germany’s Council of Economic Experts, said German industry could suffer serious damage in the long term if Russian President Vladimir Putin decides to cut gas exports to Germany.

“By most calculations, an end to gas supplies from Russia would trigger a deep recession. Half a million jobs could be lost,” daily newspaper Rheinische Post quoted Truger as saying.

Last month, Russia’s Gazpromcut Poland and Bulgaria off from its gas for refusing to pay in roubles, and threatened to do the same to others, raising fears that it could take similar action against Germany.

Russian gas accounted for 55 percent of Germany’s imports last year, and Berlin has come under pressure to unwind a business relationship that critics says is helping to fund Russia’s war in Ukraine.

Truger also said it would take a long time for inflation in Germany to fall again.

“Excessive inflation will continue well into 2023,” he said.

German inflation hit its highest level in more than four decades in April, pushed higher by a spike in the price of natural gas and mineral oil products since Russia’s invasion of Ukraine. 

Japan’s household spending 

Japanese household spending fell 2.3 percent in March from a year earlier, government data showed on Tuesday, marking the first decline in three months.

It compared with economists’ median estimate of a 2.8 percent drop.

Romania boosts interest rate 

Romania’s central bank lifted its benchmark interest rate by a more than expected 75 basis points to 3.75 percent on Tuesday and warned inflation would remain in double digits until the second half of 2023.

The bank raised its lending facility rate to 4.75 percent from 4.00 percent and its deposit rate to 2.75 percent from 2.00 percent, and said it would retain firm control over market liquidity.

A majority of analysts polled by Reuters had expected a 50 basis points hike, while some saw a bigger one percentage point raise.

Australia retail volumes rise

Australian retail sales volumes topped forecasts in the March quarter even as prices for many goods rose sharply, pointing to resilient consumer demand and a solid start for the economy this year.

Data from the Australian Bureau of Statistics out on Tuesday showed retail sales in the first quarter rose an inflation-adjusted 1.2 percent from the previous quarter, beating market forecasts of a 1 percent gain.

Sales were up 4.9 percent on a year ago basis at a record A$93.19 billion ($64.51 billion) with cafes, restaurants and takeaway food services enjoying the largest rise as coronavirus restrictions eased.

Malaysia’s industrial production 

Malaysia’s industrial production in March rose 5.1 percent from a year earlier, above forecast, government data showed on Tuesday.

March’s industrial production was expected to rise 4.8 percent, according to 12 economists surveyed in a Reuters poll.

Italy industry output flat 

Italian industrial output held up much better than expected in March, posting a flat reading from the month before after a jump of 4 percent in February, data showed on Tuesday.

A Reuters survey of 16 analysts had pointed to a 1.9 percent drop in March.

On a work-day adjusted year-on-year basis, industrial output was up 3.0 percent, following a 3.4 percent annual rise the month before, national statistics bureau ISTAT reported.

However, in the first three months of the year, output was down 0.9 percent compared with the final quarter of 2021, ISTAT said.

March saw month-on-month rises for production of consumer goods, investment goods and energy items, while intermediate goods declined.

The eurozone’s third largest economy contracted by 0.2 percent in the first quarter, hit by COVID-19 restrictions at the start of the year followed by uncertainty and high raw material prices linked to the war in Ukraine.

Mario Draghi’s government last month cut its forecast for Italy’s gross domestic product growth this year to 3.1 percent from a 4.7 percent projection made in September.

(With input from Reuters)


TASI begins July in green following a dismal June: Opening bell

TASI begins July in green following a dismal June: Opening bell
Updated 17 sec ago

TASI begins July in green following a dismal June: Opening bell

TASI begins July in green following a dismal June: Opening bell

RIYADH: Saudi stocks started their first trading session of July in green, following a dismal performance in June when the market lost 11 percent.

As of Sunday’s opening bell, TASI gained 0.60 percent to reach 11,591, while the parallel market, Nomu, added 0.17 percent to 21,622, as of 10:05 a.m. Saudi time.

This was led by a 3.03 percent gain in one of the Kingdom’s biggest lenders Saudi National Bank and a 0.26 percent gain in oil giant Aramco. 

Etihad Atheeb Telecommunication Co. gained 3.37 percent to lead the gainers, while Bupa Arabia for Cooperative Insurance Co. slipped 2.51 percent to lead the fallers.

In the financial sector, the Kingdom’s largest valued bank Al Rajhi edged up 0.85 percent, while Alinma Bank climbed 0.90 percent.

Al Moammar Information Systems Co. added 2.22 percent, after being awarded SR34 million ($9 million) by Saudi Co. for Comprehensive Technical and Security Control as well as SR21.9 million by King Abdulaziz City for Science and Technology.

Abdullah Al Othaim Markets Co. edged down 0.19 percent, after reporting that it canceled the initial public offering plans for its malls unit.

Oil prices closed Friday with US West Texas Intermediate crude at $108.43 per barrel and Brent crude at $111.63 per barrel.


Saudi IT firm Al Moammar secures $15m in contracts with two firms

Saudi IT firm Al Moammar secures $15m in contracts with two firms
Updated 29 min 11 sec ago

Saudi IT firm Al Moammar secures $15m in contracts with two firms

Saudi IT firm Al Moammar secures $15m in contracts with two firms

RIYADH: Saudi IT solution provider Al Moammar Information Systems Co. won an SR34.4 million ($9 million) project with the Saudi Co. for Comprehensive Technical and Security Control.

The deal, valid for 36 months, is to implement a project to raise the operational efficiency of the security firm.

The IT firm, known as MIS, was also awarded a three-year contract with King Abdulaziz City for Science and Technology worth SR21.9 million, according to a bourse filing.

In a separate announcement, MIS said its board approved the distribution of SR36 million in dividends at SR1.2 per share for the first half of 2022.


Here’s what you need to know before Tadawul trading on Sunday

Here’s what you need to know before Tadawul trading on Sunday
Updated 34 min 3 sec ago

Here’s what you need to know before Tadawul trading on Sunday

Here’s what you need to know before Tadawul trading on Sunday

RIYADH: Saudi Arabia’s stock market posted its second-largest monthly decline of the year in June, led by fears of interest rate hikes weighing on investor optimism.

TASI, as the main index is known, ended June losing 11 percent to reach 11,523 at the closing bell of Thursday’s session, while Nomu exited the month at 21,585.

Elsewhere in the Gulf, stock exchanges of Dubai, Qatar, Abu Dhabi, and Oman shed between 0.1 and 0.7 percent, while those of Bahrain and Kuwait were up 0.8 and 0.2 percent, respectively.

In energy trading, Brent crude settled at $111.63 a barrel on Friday, while US West Texas Intermediate reached $108.43 a barrel.

Stock news

The Saudi National Bank will distribute dividends of SR4.9 billion ($1.3 billion) in total to its shareholders for the first half of 2022

Saudi Industrial Development Co.’s unit Sleep High signed a deal worth SR12.7 million annually with Emmdad Logistics Services

Al Moammar Information Systems Co. won a SR34.4 million project with the Saudi Co. for Comprehensive Technical and Security Control in addition to a SR21.9 million deal with King Abdulaziz City for Science and Technology

Al Moammar Information Systems Co.’s board of directors approved the distribution of SR1.2 per share in dividends for the first half of 2022

Arabian Pipes Co. was awarded a SR60 million deal to supply oil and gas steel pipes to oil giant Aramco

International Human Resources Co. intends to proceed with a 20-percent stake initial public offering on Saudi Arabia’s parallel Nomu market

Arabian Centres Co. declared a cash dividend of SR0.75 per share for the second half of its fiscal year ended March 31, 2022

Banque Saudi Fransi signed a SR44 million contract with Allianz Saudi Fransi Cooperative Insurance Co. for credit life insurance coverage

Shareholders of ACWA Power Co. approved the recommendation to distribute a SR0.77 dividend per share for 2021

Thimar Development Holding Co.’s losses widened by 79 percent to SR11.7 million in 2021

Shareholders of Bupa Arabia for Cooperative Insurance Co. approved a dividend payout of SR4.5 per share for the fiscal year 2021

L’azurde Co. for Jewelry got its shareholders’ approval to distribute cash dividends of SR0.25 per share for 2021

Al-Alamiya for Cooperative Insurance Co. sealed a five-year bancassurance distribution agreement with Riyad Bank

Unitholders of Albilad Saudi Sovereign Sukuk ETF are set to receive SR80,808 in total as cash dividends for the month of June

Saudi Real Estate Co.’s subsidiary Tamear got its shareholders’ approval to reduce capital from SR100 million to SR34 million

Calendar

July 4, 2022

Launch of single-stock futures trading on Tadawul

July 7, 2022

Saudi Exchange will close for Eid Al Adha holidays and resume trading on July 13


Saudi iHR selects Yaqeen Capital to advise on IPO for 20% stake

Saudi iHR selects Yaqeen Capital to advise on IPO for 20% stake
Updated 45 min 42 sec ago

Saudi iHR selects Yaqeen Capital to advise on IPO for 20% stake

Saudi iHR selects Yaqeen Capital to advise on IPO for 20% stake

RIYADH: Saudi recruitment service provider International Human Resources has selected Yaqeen Capital to advise on its potential initial public offering on the Kingdom’s stock market.

The company is looking to offer 500,000 shares, representing 20 percent of its capital, on the parallel market Nomu, according to a filing.

The IPO will be confined to qualified investors, who will be allowed to subscribe starting July 31 until Aug. 2.

Established in 2005, iHR offers human resources solutions and employment-related consultancy to businesses.

Saudi iHR selects Yaqeen Capital to advise on IPO for 20% stake

RIYADH: Saudi recruitment service provider International Human Resources has selected Yaqeen Capital to advise on its potential initial public offering on the Kingdom’s stock market.

The company is looking to offer 500,000 shares, representing 20 percent of its capital, on the parallel market Nomu, according to a filing.

The IPO will be confined to qualified investors, who will be allowed to subscribe starting July 31 until Aug. 2.

Established in 2005, iHR offers human resources solutions and employment-related consultancy to businesses.


Saudi Aramco awards $16m steel pipes order to Arabian Pipes

Saudi Aramco awards $16m steel pipes order to Arabian Pipes
Updated 03 July 2022

Saudi Aramco awards $16m steel pipes order to Arabian Pipes

Saudi Aramco awards $16m steel pipes order to Arabian Pipes

RIYADH: Saudi oil giant Aramco has given out an order worth SR60 million ($16 million) to homegrown Arabian Pipes Co. to supply steel pipes.

The contract will be valid for one year, the Riyadh-based pipe manufacturer said in a statement to the Saudi stock exchange, Tadawul.

Arabian Pipes expects the transaction to impact its financial statements starting from the second quarter of 2023.

This comes as an extension to two contracts awarded by Aramco to Arabian Pipes so far this year, worth SR368 million in total.