Egypt Independent: Business-Main news http://www.egyptindependent.com//enhome_channel/Economy/rss.xml en Energy units lift Siemens' profit well above forecasts http://www.egyptindependent.com//node/2469329 <img src="http://www.egyptindependent.com///sites/default/files/imagecache/media_thumbnail/photo/2011/12/29/54605/windfarmcompressed.jpg" alt="" title="" class="imagecache imagecache-media_thumbnail" width="152" height="114" /><p><span class="focusParagraph">German industrial group Siemens beat expectations for second-quarter profit as it accelerated a cost-cutting programme and lifted its savings target for the year on Wednesday.</span></p><p><span class="focusParagraph">The easing of sanctions on Iran boosted earnings at its Power and Gas unit, helping to offset lower demand for large turbines in Europe, while its Wind Power and Renewables unit swung to a profit as projects were completed and costs fell.</span></p><p><span class="focusParagraph">Group industrial profit jumped 28 percent to 2.12 billion euros (US$2.43 billion), beating all the estimates in a Reuters poll and lifting its key industrial profit margin to 10.9 percent from 9.0 percent a year ago.</span></p><p><span class="focusParagraph">New orders rose seven percent </span>&mdash;<span class="focusParagraph"> less than expected </span>&mdash;<span class="focusParagraph"> helped by a huge power-plant order from Egypt and a offshore wind farm contract in Britain, while sales rose by a slightly-better-than-forecast five percent.</span></p><p><span class="focusParagraph">&quot;We confirm our financial guidance for fiscal 2016 although the market environment for our high-margin short-cycle businesses may not pick up materially in the second half,&quot; Siemens said in a statement.</span></p><p><span class="focusParagraph">The Munich-based trains-to-turbines group expects moderate revenue growth, a full-year industrial profit margin of 10-11 percent and earnings per share of 6.00 to 6.40 euros for its fiscal year to end-September.</span></p><p><span class="focusParagraph">It raised its full-year cost-savings target to 850 to 950 million euros from 800 to 900 million euros previously.</span></p><p><span class="focusParagraph">Arch-rival General Electric last month confirmed its target of two to four percent revenue growth for 2016 </span>&mdash;<span class="focusParagraph"> a forecast that met with some scepticism due to sluggish demand for oil and gas equipment and a weak industrial economy. </span></p><p><span class="focusParagraph">($1 = 0.8709 euros) </span></p> Wed, 04 May 2016 08:41:00 +0000 Reuters 2469329 at http://www.egyptindependent.com sites/default/files/photo/2011/12/29/54605/windfarmcompressed.jpg Afreximbank seeks to raise US$3 bln this year: bank president http://www.egyptindependent.com//node/2469327 <img src="http://www.egyptindependent.com///sites/default/files/imagecache/media_thumbnail/photo/2015/09/20/499612/afreximbank-logo.jpg" alt="" title="" class="imagecache imagecache-media_thumbnail" width="152" height="114" /><p><span class="focusParagraph">The African Export-Import Bank (Afreximbank) will seek to raise around US$3 billion this year via Eurobonds, syndications and bi-lateral and institutional lending in order to finance its activities, the bank&#39;s president told Reuters on Tuesday.</span></p><p><span class="focusParagraph">&quot;We are going to issue a Eurobond very soon. We are going to go to the syndicated loan market. We are also prepared to issue some local currency bonds, so we can fund some local currency activities,&quot; Benedict Okey Oramah said in an interview.</span></p><p><span class="focusParagraph">Oramah said the Cairo-based lender would aim to issue a Eurobond mid-year subject to market conditions, though he did not disclose how much it would seek to raise via the bond.</span></p><p><span class="focusParagraph">The local currency bonds would be issued during the last quarter of the year for an amount not expected to exceed $200 million, he said.</span></p><p><span class="focusParagraph">Afreximbank would also seek to increase deposits from the central banks of member countries to $10 billion from $3 billion currently, Oramah said.</span></p><p><span class="focusParagraph">Afreximbank is a multilateral organisation with a mandate to help African countries overcome difficulties with financing and developing trade.</span></p> Wed, 04 May 2016 08:25:00 +0000 Reuters 2469327 at http://www.egyptindependent.com sites/default/files/photo/2015/09/20/499612/afreximbank-logo.jpg Saudi plans stock market reforms to draw foreign money http://www.egyptindependent.com//node/2469313 <img src="http://www.egyptindependent.com///sites/default/files/imagecache/media_thumbnail/photo/2016/05/03/505021/saudi_stocks.jpg" alt="" title="" class="imagecache imagecache-media_thumbnail" width="152" height="114" /><p><span id="articleText"><span class="focusParagraph">Saudi Arabia announced a string of reforms to its stock market that could attract billions of dollars of fresh foreign money and smooth sales of state assets as the kingdom grapples with damage to its finances caused by low oil prices.</span></span></p><p><span id="articleText">When Riyadh opened its bourse to direct foreign investment last June, it took a cautious approach, imposing tight ownership limits and minimum qualifications for overseas institutions to reduce the risk of them destabilizing the market.</span></p><p><span id="articleText">Reforms announced on Tuesday suggested authorities are now courting foreign money more aggressively. Last week, Deputy Crown Prince Mohammed bin Salman outlined sweeping plans to cut the kingdom&#39;s dependence on oil exports.</span></p><p><span id="articleText">Among his plans are a privatization program that will include offering a stake of under five percent in national oil giant Saudi Aramco. The Saudi stock market could have trouble absorbing the shares without an infusion of foreign money.</span></p><p><span id="articleText">&ldquo;This is a very good piece of news and supportive of the stock market in the medium to long term,&quot; Sebastien Henin, head of asset management at Abu Dhabi&#39;s The National Investor, said of Tuesday&#39;s announcement.</span></p><p><span id="articleText">&quot;It may clear the road for the possible listing of Aramco shares...All in all, this will align the bourse with international markets and encourage foreign investors to allocate funds to Saudi shares.&quot;</span></p><p><span id="articleText">Each foreign institutional investor will be allowed to own directly a stake of just under 10 percent of a single listed company, up from a previous ceiling of five percent, the Capital Market Authority (CMA) announced.</span></p><p><span id="articleText">Other restrictions were scrapped, including a ceiling of 10 percent on combined ownership by foreign institutions of the market&#39;s entire capitalization. All foreign investors combined will still be limited to owning 49 percent of any single firm.</span></p><p><span id="articleText">To qualify as a foreign institutional investor in Saudi Arabia, each asset manager will only need to have a minimum of US$1 billion of assets under management globally, instead of $5 billion. The CMA said it would now accept investments by new types of foreign institution including sovereign wealth funds and university endowments.</span></p><p><span id="articleText">The regulator also said it had approved the introduction of securities lending and covered short-selling to the stock market, which would give investors more options to hedge their purchases against market downturns.</span></p><p><span id="articleText">Meanwhile, the Saudi Stock Exchange will introduce during the first half of 2017 the settlement of trades within two working days of execution, the bourse said.</span></p><p><span id="articleText">At present, trades must be settled on the same day. This has inconvenienced foreign investors in particular as they must have large amounts of money on hand before trading, which can be hard given Riyadh&#39;s time zone and its Sunday toThursday business week. Many big emerging markets have settlement after two days.</span></p><p><strong><span id="articleText">MSCI entry </span></strong></p><p><span id="articleText">Saudi Arabia wants to join international index compiler MSCI&#39;s emerging markets index as soon as in 2017, because many global funds base their investments on that index. Officials have conceded same-day settlement is an obstacle to inclusion.</span></p><p><span id="articleText">MSCI is expected to say in June whether it will review Saudi Arabia for possible inclusion in the index, and the reforms announced on Tuesday could help to sway its decision.</span></p><p><span id="articleText">Nevertheless, the Saudi stock market did not react positively to the announcement; its index .TASI was 1.4 percent lower in late trade.</span></p><p><span id="articleText">One reason is that the reforms will take considerable time to materialize. The CMA said its new foreign ownership rules, and a date for them to take effect, would be revealed only by the end of the first half of 2017.</span></p><p><span id="articleText">A deeper reason is that despite last June&#39;s opening to foreign institutions, overseas funds have so far not been very keen to put their money into Saudi Arabia; total direct and indirect foreign investment accounts for less than one percent of the $408 billion stock market, bourse data shows.</span></p><p><span id="articleText">Low oil prices, as well as the inefficiencies of Saudi firms and the greater dynamism of other emerging economies, have diverted money from the kingdom. It may take years before it becomes clear if the economic reform drive will change this.</span></p><p><span id="articleText">At the end of 2015, only nine foreign institutions had obtained licenses to invest directly in the Saudi market. The Middle East head of a big international fund manager, declining to be named because of commercial sensitivities, said this number would not necessarily rise sharply when restrictions were eased.</span></p><p><span id="articleText">&quot;You can ease regulations as much as you want, but the value proposition of Saudi Arabia needs to be strong enough to make it worthwhile for institutional investors to come in,&quot; he said. </span></p> Tue, 03 May 2016 13:18:00 +0000 Reuters 2469313 at http://www.egyptindependent.com sites/default/files/photo/2016/05/03/505021/saudi_stocks.jpg Tokyo slide keeps mood downbeat http://www.egyptindependent.com//node/2469271 <img src="http://www.egyptindependent.com///sites/default/files/imagecache/media_thumbnail/photo/2016/05/02/504802/nikei.jpg" alt="" title="" class="imagecache imagecache-media_thumbnail" width="152" height="114" /><p>A 3 percent plunge in the Tokyo stock exchange and falls in European banking shares added to a gloomy global financial mood on Monday, pushing oil prices lower and the dollar to an 18-month low against the yen.<br /><br />With trading thinned out by holidays in London and many Asian economies, a solid read of manufacturing sentiment in Germany drove the Frankfurt stock exchange around 1 percent higher. <a href="http://www.reuters.com/finance/markets/index?symbol=de!daxx" target="_blank">(.GDAXI)</a><br /><br />That also helped France&#39;s CAC 40 (<a href="http://www.reuters.com/finance/markets/index?symbol=fr!CAC" target="_blank">.FCHI</a>) gain almost half a percent. But elsewhere the picture showed more of the concern over banking, poor economic growth and over-inflated asset prices that has gripped financial markets for much of this year.<br /><br />Brent crude fell more than 1 percent LCOc1 to $46.78 a barrel while the European banking index .SX7E lost 0.6 percent. MSCI&#39;s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was down 0.3 percent.<br /><br />The yen, which tends to gain when Japanese and global market investors get worried about growth, reached 106.14 yen per dollar in early Asian trade before steadying on the day.<br /><br />Last week was the yen&#39;s best since the 2008 financial crisis, thanks largely to a Bank of Japan policy meeting that gave no hint of further efforts to stimulate a long-moribund economy with more outright money-printing.<br /><br />&quot;A lot of people are still talking about Japan,&quot; said Thu Lan Nguyen, a strategist with Germany&#39;s Commerzbank.<br /><br />&quot;The BOJ are creating the impression that they will always react too late to deflationary risks. Now that they have disappointed, I think it would take something really new to change the market&#39;s mind on the yen.&quot;<br /><br />Adding to the subdued sentiment, a survey released on Sunday showed that activity in China&#39;s manufacturing sector expanded for the second month in a row in April but only marginally, raising doubts about the sustainability of a recent pick-up in the economy.<br /><br />Australian shares fell 0.2 percent after disappointing results from Westpac Banking Corp (<a href="http://www.reuters.com/finance/stocks/overview?symbol=WBC.AX" target="_blank">WBC.AX</a>).<br /><br />Australia&#39;s central bank board will meet for a policy review on Tuesday and is widely expected to keep its cash rate at a record low of 2.0 percent, though some economists expect a cut.<br /><br />Markets in Hong Kong, China, Taiwan, Singapore and Malaysia were closed on Monday. Japan is in the middle of its Golden Week series of holidays and markets there will be closed on Tuesday, Wednesday and Thursday of this week.<br /><br />Investors have also turned broadly negative on the dollar in the past two months, worried that the U.S. Federal Reserve will be unable to raise interest rates this year. A fall to a 6-1/2 month low of $1.1484 against the euro (<a href="http://www.reuters.com/finance/currencies/quote?srcCurr=EUR&amp;destCurr=USD" target="_blank">EUR=</a>) bode ill for the run-in to payrolls data on Friday. The dollar index of its strength against a basket of six rival currencies, fell 0.2 percent to 92.899 .DXY.<br /><br />&quot;The start of the new month does not mean a new trend.&nbsp; The technical tone of the dollar is weak,&quot; Marc Chandler, global head of currency strategy at Brown Brothers Harriman in New York, said in a note to clients.<br /><br />&quot;The Federal Reserve acknowledges the continued improvement in the labor market. The problem is that it has not translated to stronger consumption, and business investment remains soft.&quot;</p> Mon, 02 May 2016 11:50:00 +0000 Reuters 2469271 at http://www.egyptindependent.com sites/default/files/photo/2016/05/02/504802/nikei.jpg