Money & Me: ‘My best investment is an Abu Dhabi property purchased at the height of Covid-19'
Christoph Koster, CEO of digital Islamic community bank ruya, adopts a balanced approach to investments
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Zawya
2 hours ago
- Zawya
Qatar: QSE reopens with 139 points gain as foreign funds turn bullish; M-cap adds $2.04bln
Qatar - An across the board buying was visible as the 20-stock Qatar Index shot up 1.31% to 10,697.1 points, recovering from an intraday low of 10,576 points. The Qatar Stock Exchange Tuesday reopened after Eid holidays with a huge 139 points gain in index and more than QR7bn in capitalisation, mirroring global sentiments on the back of positive signals emanating on the US-China trade talks. An across the board buying was visible as the 20-stock Qatar Index shot up 1.31% to 10,697.1 points, recovering from an intraday low of 10,576 points. The foreign institutions were seen net buyers in the main market, which reported 1.19% gains year-to-date. About 83% of the traded constituents extended gains to investors in the main bourse, whose capitalisation added QR7.44bn or 1.19% to QR631.81bn mainly on account of mid and small cap segments. However, the local retail investors turned bearish in the main market, which saw as many as 1,500 exchange traded funds (sponsored by Doha Bank) valued at QR0.02mn trade across two deals. The Gulf institutions were increasingly net profit takers in the main bourse, whose trade turnover and volumes were on the rise. The Islamic index was seen gaining slower than the other indices of the main market, which saw no trading of treasury bills. The Arab individual investors turned bullish in the main bourse, which saw a total of 0.1mn sovereign bonds valued at QR1.04bn change hands across three transactions. The Total Return Index gained 1.31%, the All Islamic Index 1.16% and the All Share Index 1.29% in the main market. The banks and financial services sector index soared 1.88%, real estate (1.25%), consumer goods and services (0.93%), insurance (0.75%), telecom (0.68%), industrials (0.47%) and transport (0.23%). Major movers in the main market included Vodafone Qatar, Beema, Qatar Oman Investment, Commercial Bank, Baladna, Qatar Islamic Bank, Doha Bank, QIIB, Lesha Bank, Dukhan Bank, Qatari Investors Group, Mesaieed Petrochemical Holding, Qamco, Qatar Insurance, Mazaya Qatar, Ezdan and Nakilat. Nevertheless, Qatar General Insurance and Reinsurance, Milaha, Gulf International Services, Qatar Islamic Insurance and Ooredoo were among the shakers in the main bourse. In the venture market, Techno Q saw its shares depreciate in value. The foreign institutions turned net buyers to the tune of QR87.62mn compared with net profit takers of QR55.13mn last Wednesday. However, the local individuals were net sellers to the extent of QR45.68mn against net buyers of QR36.06mn on June 4. The Gulf institutions' net selling increased substantially to QR14.75mn compared to QR1.62mn the previous trading day. The Arab retail investors turned net sellers to the tune of QR10.55mn against net buyers of QR3.09mn last Wednesday. The domestic institutions were net profit takers to the extent of QR10.18mn compared with net buyers of QR14.51mn on June 4. The foreign individual investors' net selling strengthened noticeably to QR3.98mn against QR0.37mn the previous trading day. The Gulf retail investors turned net sellers to the tune of QR2.47mn compared with net buyers of QR3.46mn last Wednesday. The Arab institutions had no major net exposure for the second straight session. The main market saw an 11% jump in trade volumes to 234.17mn shares and less than 1% in value to QR494.59mn but on 41% contraction in deals to 24,293. In the venture market, a total of 0.1mn equities valued at QR0.28mn changed hands across 10 transactions. © Gulf Times Newspaper 2022 Provided by SyndiGate Media Inc. (
Zawya
3 hours ago
- Zawya
European defence supercycle means scrapping deficit fears: Klement
(The views expressed here are those of the author, an investment strategist at Panmure Liberum.) European defence stocks have been on a tear since the devastating conflict in Ukraine started in 2022, a trend that has only accelerated since announcements of European rearmament plans. But the beneficial economic impact of the European defence supercycle may be heavily dependent on how it's financed. The Stoxx Europe TMI Aerospace & Defense index has posted annualised returns above 40% since February 2022. Earlier this year, some investors thought the defence rally might slow as a ceasefire in Ukraine started to seem more likely. But ceasefire hopes have been dashed for now, and the NATO summit on June 24-25 may see European countries boost their commitments to defence spending even more. NATO General Secretary Mark Rutte recently said he expects the bloc to agree at the summit to increase defence spending to an eye-catching 5% of GDP, with 3.5% of that directed to 'hard' defence like weapons, personnel, and infrastructure. The rest would be dedicated to measures like home defence and civilian preparation. But even this 3.5% target is ambitious. Currently, only Poland meets this target, while the U.S. and Estonia come close at 3.4% of GDP. The amount of spending being proposed here is enormous. For example, if the UK, France, Spain, and Italy were to raise defence budgets to 3.5% of GDP by the mid-2030s, they would each have to increase their annual defence spending by about $40 billion. In total, NATO members would have to boost their annual defence budgets by around $375 billion. For context, the global aerospace and defence market currently has annual revenues of roughly $1.3 trillion, and Europe's defence industry accounts for about a quarter at $330 billion. SHOT IN THE ARM Increased defence spending could help Europe overcome its persistent growth challenge. Going back to 1960, every euro spent on defence has increased European GDP growth by around one euro as well. This fiscal multiplier is at the upper end of the 0.6 to 1.0 range that academic studies about the U.S. typically find. Moreover, as European defence spending increases, the fiscal multiplier rises as well because the region's defence industry capacity remains severely constrained, so contractors are forced to quickly hire new employees at higher salaries or build new facilities, amplifying the impact of the fiscal stimulus. For example, German defence contractors like Rheinmetall and Hensoldt had to borrow workers and entire factories from other businesses like Continental and Bosch to keep up with the increased demand from the Ukraine war. Importantly, if NATO agrees to further expand defence spending into the 2030s, even if the Ukraine conflict ends, they can provide European defence companies with the confidence they need to build new factories, hire employees, and train much-needed specialists to overcome these capacity constraints. AT WHAT COST? The main challenge will almost certainly not be the region's willingness to re-arm, but rather how to pay for it. In the case of the United Kingdom, the British government last week published its strategic defence review, which sets out a plan to get the country war ready and increase defence spending to 3% of GDP in the next parliament between 2029 and 2034. Unfortunately, barring any major surprises at the 2025 spending review to be published on June 11, the UK government will continue to stick to its fiscal rules and limit investment spending to an annual real growth rate of 1.3% until 2030. The Institute for Fiscal Studies has calculated that by adhering to these rules, increasing defence spending will have to come at the expense of non-defence investments. This means that any boost to growth from increasing defence spending in the UK could be offset by the negative impacts of deteriorating civilian infrastructure and public services, such as healthcare and education. Another option, which may be more economically beneficial long-term, is financing increased defence spending with additional debt issuance, as the EU plans to do with its Readiness 2030 initiative. This will mean reforming self-imposed fiscal rules. But if running larger deficits now can boost growth, this should keep debt-to-GDP ratios under control, create jobs, and help to secure Europe's future. True, increased deficits risk drawing the ire of bond vigilantes. But the market reaction to the announcement of Readiness 2030 and Germany's huge infrastructure package suggests that bond investors are fine with additional deficits as long as the money is expected to be spent on productive investments. While government bond yields rose briefly after these spending plans were announced, they have already reversed these moves. The biggest risk is that the spending does not prove as productive as expected, which could eventually lead Europe into another debt crisis, but given the enormous economic and security challenges that the continent faces, this may be a risk worth taking. (The views expressed here are those of Joachim Klement, an investment strategist at Panmure Liberum, the UK's largest independent investment bank). Enjoying this column? Check out Reuters Open Interest (ROI), your essential new source for global financial commentary. ROI delivers thought-provoking, data-driven analysis. Markets are moving faster than ever. ROI can help you keep up. Follow ROI on LinkedIn, opens new tab and X, opens new tab. (Writing by Joachim Klement. Editing by Anna Szymanski and Mark Potter.)
The National
3 hours ago
- The National
EU plans to remove the UAE from its 'high-risk' money-laundering list
The European Union plans to remove the UAE from its list of countries that pose a high risk for money laundering, amid growing efforts by the Emirates to boost its regulatory framework. The European Commission, the EU's main executive body, said on Tuesday that the list was updated after taking into account the work of the Financial Action Task Force (FATF) and in particular its list of 'Jurisdictions under Increased Monitoring'. The FATF, the global body that combats money laundering and terrorism financing, removed the UAE from its "grey list" in February last year after significant reform progress. The Emirates was placed on the grey list in 2022. "As a founding member of FATF, the Commission is closely involved in monitoring the progress of the listed jurisdictions, helping them to fully implement their respective action plans agreed with FATF," the European Commission said. The commission added 10 countries to the high-risk list, including Algeria, Angola, Côte d'Ivoire, Kenya, Laos, Lebanon, Monaco, Namibia, Nepal and Venezuela. Along with the UAE, others taken off the list include Barbados, Gibraltar, Jamaica, Panama, the Philippines, Senegal and Uganda. However, the updated list will enter into force only after it receives the no‑objection from the European Parliament and the Council within a period of one month (which can be extended for another month). The commission said it had "carefully considered the concerns expressed regarding its previous proposal and conducted a thorough technical assessment, based on specific criteria and a well‑defined methodology, incorporating information collected through the FATF, bilateral dialogues and on‑site visits to the jurisdictions in question". The UAE has made significant progress in combating money laundering and the financing of terrorism over the past few years, passing strict laws and issuing a number of regulations to clamp down on financial crime. In September last year, the UAE set out a nationwide action plan aimed at combating terrorism financing and money laundering. The 2024-27 National Strategy for Anti-Money Laundering, Countering the Financing of Terrorism and Proliferation Financing has 11 goals focused on risk-based compliance, effectiveness and sustainability. The enhanced framework, overseen by the Higher Committee and led by an expanded National Committee, includes the former Executive Office of Anti-Money Laundering and Counter Terrorism Financing, which now serves as the General Secretariat. In August, the government also amended its laws against money laundering and the financing of terrorism and crime groups and formed a national committee on these crimes. As part of its AML/CFT reforms, the UAE is adding measures to assist with investigations, imposing sanctions in cases of non-compliance at financial institutions, and increasing the number of prosecutions to combat money laundering. The UAE Central Bank has been imposing a growing number of fines and penalties in recent months to clamp down on violators. On Tuesday, the regulator imposed varying financial sanctions on six exchange houses in the UAE, amounting to Dh12.3 million (due to "violations and failures" to comply with the AML/CFT framework and related regulations. In May, it issued one exchange house with a Dh3.5 million fine, while another was slapped with a Dh100 million levy for 'significant failures' in its AML/CFT framework and related regulations. The regulator last month also fined an exchange house Dh200 million for the same offence. A Dh500,000 fine was also imposed on a branch manager, who was banned from working in any licensed financial institutions in the UAE. The Central Bank also recently fined two branches of foreign banks operating in the country a total of Dh18.1 million for breaching anti-money laundering regulations.
