Market Wrap MENA-Asia 21 July: Cairo Touches 54,000 in a Second Straight Record and Qatar Extends Above 10,000 as Asia’s Chip Complex Snaps Back With Taiwan Up 4.2 Percent

By The Edge Research Team

Tuesday belonged to the rebound, with two Gulf exceptions. Asia’s chip complex snapped back violently, Taiwan’s Taiex jumped 4.20 percent, Shenzhen 4.81 percent and Seoul’s Kospi 3.56 percent, while Tokyo returned from its Marine Day holiday to a 3.26 percent Nikkei rally that recovered most of Friday’s crash. The Gulf’s headline stories extended: Cairo’s EGX30 rose 1.63 percent to 53,989.55, a second straight record close that touched above 54,000 during the session, and Qatar’s QE Index added 0.23 percent to 10,107.36 in its third session back, our calculation. The exceptions were Saudi Arabia, where TASI eased 0.40 percent to 10,698.81, and Muscat, which logged a confirmed fifth straight decline of 0.85 percent.

Asia’s session was the mirror of Monday’s American close. The SOX’s first green close since the selloff, covered in our US-Europe wrap, handed Asia’s chipmakers their cue: the Taiex surged 4.20 percent to 44,232.87, recovering about half of its 6.47 percent Friday plunge, Shenzhen’s component index jumped 4.81 percent to 14,264.29, and the Kospi rose 3.56 percent to 6,747.95, leaving Seoul about 1 percent below its pre-rout close, our calculation. Tokyo’s first print since Friday’s 4.03 percent drop was a 3.26 percent Nikkei gain to 66,232.19, within 1 percent of its pre-crash close, our calculation, with the Topix reclaiming 4,000 at 4,014.95, up 2.44 percent. The exceptions were flat: Hong Kong’s Hang Seng eased 0.04 percent after leading Monday, Shanghai added a further 1.79 percent, India’s Nifty 50 slipped 0.21 percent, Australia closed flat and Singapore’s Straits Times rose 0.51 percent.

Cairo pressed its record run into new territory. The EGX30 rose 1.63 percent to 53,989.55 after touching 54,064.76 during the session, per the exchange’s prints, its second consecutive record close in our published record, and is now up 29.07 percent for the year. The exchange’s dollar-terms EGX30 series rose a stronger 1.73 percent, its own print, and the currency followed the equity market’s direction for once: the pound firmed back below the 51 line to 50.93 per dollar on CNBC quotes, up 0.24 percent, unwinding the weekend slide our Monday wraps tracked. A record equity market and a firming pound on the same day is the alignment Cairo’s rally had been missing, our reading.

Doha kept building. The QE Index added 0.23 percent to 10,107.36 with 348.5 million riyals traded, our calculation across the exchange’s session levels, a third straight gain since the reopening that leaves the index about 1.5 percent above where the suspension ended, our calculation. The rest of the Gulf’s green was quieter: Dubai’s DFM General Index rebounded 0.28 percent to 5,812.37, Abu Dhabi’s FADGI rose 0.35 percent to 9,784.62, and Bahrain’s All Share edged up 0.06 percent to 1,966.63 for a second small gain, while Boursa Kuwait closed effectively flat, the All Share off 0.07 percent at 8,620.73 and the Premier Market off 0.05 percent at 9,039.94. Amman firmed 0.16 percent to 3,912.68 per the exchange’s prints.

The two exceptions ran in opposite sizes. TASI’s 0.40 percent decline to 10,698.81, with the MSCI Tadawul 30 down 0.38 percent at 1,432.43, was orderly, a second red session that leaves the benchmark about 1.1 percent below its pre-blockade close, our calculation. Muscat’s was sharper but ended off its worst: the confirmed close, published after the exchange’s intraday feed froze at a 14:04 print of 7,010.12, put the MSX 30 at 7,091.30, down 0.85 percent with 37 decliners to 14 gainers, a fifth straight fall that leaves the four-session slide since Wednesday’s close at about 6.3 percent, our calculation. The index surrendered the 7,100 line but held 7,050, and the roughly 81-point recovery from the frozen mid-afternoon print says the final hour found buyers even as the run of declines extended, our reading of the session record.

The cross-asset board pointed the same direction as Asia. Brent traded back above 90 dollars at 90.34, up 1.26 percent from Monday’s 89.22 settlement, and WTI rose 1.59 percent to 84.55, while gold broke decisively upward from its fight at the 4,000 line, rising 1.20 percent to 4,064.10 dollars, oil and gold rising together as the war premium rebuilt without a risk-off tone. The VIX fell 5.04 percent to 17.71, Bitcoin rose 1.82 percent to 66,265 dollars, and the 10-year Treasury yield held at 4.60 percent into Thursday’s European Central Bank decision. The euro was little changed at 1.1421, sterling eased 0.13 percent to 1.3410, the yen slipped 0.14 percent to 162.72 and the Kuwaiti dinar held near 0.3077.

Further west, Monday’s closes from our published wrap remain the reference: Wall Street faded oil’s round trip to a near-flat close, the Nasdaq down 0.05 percent with the SOX up 0.60 percent in its first green session since the selloff, while Nvidia’s market-cap lead over Apple widened to about 120 billion dollars.

Why it matters: The chip crash that defined Friday and Monday has been substantially repriced in two sessions, and the Gulf’s split makes the region’s stress map precise: the pressure is not in the large caps, TASI’s two red sessions total about 1.1 percent, but in Muscat, where a confirmed fifth straight fall put the four-session cost at about 6.3 percent, while the pressure on Egypt’s currency eased, the pound back below 51 as Cairo set a second straight record. An oil price back above 90 with gold at 4,064 says the war premium is rebuilding through commodities while equities look through it.

Outlook: The markers into midweek: whether Muscat’s five-session slide finds a floor, whether Cairo can close above 54,000, and the European Central Bank’s Thursday decision with Brent back above 90 dollars inside it. Tesla’s results land in the earnings season that just repriced the chip complex twice in four sessions, and the pound’s return below 51 faces its first test if oil holds the 90 handle.

Table – MENA and Asia equities, 21 July close, ranked by change:

Table – US and Europe, Monday 20 July closes, for reference, ranked by change:

Table – Commodities, rates, volatility, FX and crypto, intraday 21 July:

Price basis: Gulf and Egypt closes pulled 14:20-15:41 Kuwait time at exchange originators on 21 July, with the Saudi close confirmed across two identical post-close prints; the Muscat figure has been updated to the exchange’s confirmed close, published after its intraday feed froze at 14:04 local, and is not a confirmed closing value; Asia closes and commodity, rate and FX figures via CNBC quotes 11:20-11:40 GMT on 21 July, intraday and not settlements; the Qatar change is computed across the exchange’s published session levels.

Sources: Egyptian Exchange; Qatar Stock Exchange; Saudi Exchange; Boursa Kuwait; Bahrain Bourse; Muscat Stock Exchange; Amman Stock Exchange; Dubai Financial Market; Abu Dhabi Securities Exchange; CNBC.

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