World shares mixed ahead of Trump-Putin meeting in Helsinki

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Shares edged higher in early European trading on Monday after Asian benchmarks slipped on news that China’s economy grew at a lackluster 6.7 percent pace in the last quarter. Attention was focused on the latest back-and-forth between China and the U.S. in a tariffs dispute, and on President Donald Trump’s summit with Russian President Vladimir Putin, planned for later in the day.

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KEEPING SCORE: Germany’s DAX gained 0.1 percent to 12,555.65 and the CAC 40 in France was almost flat at 5,430.60. Britain’s FTSE 100 edged 0.1 percent lower to 7,652.97. The Dow future contract added 0.2 percent to 25,055.00 while the future for the SP 500 picked up 0.1 percent to 2,806.50.

ASIA’S DAY: The Shanghai Composite index lost 0.6 percent to 2,814.04, while Hong Kong’s Hang Seng edged 0.1 percent higher to 28,539.66. The Kospi in South Korea fell 0.4 percent to 2,301.99 and Australia’s SP ASX 200 gave up 0.4 percent to 6,241.50. Shares fell in Southeast Asia and Taiwan. Japan’s market was closed for a holiday.

TRADE UPDATE: China announced it filled a World Trade Organization challenge Monday to U.S. President Donald Trump’s proposal for a tariff hike on $200 billion of Chinese goods, reacting swiftly amid deepening concern about the economic impact of their spiraling technology dispute. Earlier Monday, European Council President Donald Tusk, while on a visit to Beijing, urged President Donald Trump, Russian President Vladimir Putin and China to work with Europe to avoid trade wars and prevent conflict and chaos. He said Europe, China, the U.S. and Russia had a “common duty” not to destroy the global order but to improve it by reforming international trade rules.

CHINA ECONOMY GROWS: China’s economic growth slowed in the quarter ending in June, adding to challenges for Beijing amid a mounting tariff battle with Washington. The 6.7 percent pace of growth for the world’s second-largest economy compared with 6.8 percent in the previous quarter. Even before the trade dispute with Washington erupted, forecasters expected growth to cool after Beijing started tightening controls on bank lending last year to rein in surging debt.

ANALYST’S VIEWPOINT: “The upshot is that the statistics bureau is now starting to more publicly acknowledge that the economy is losing steam. This should make it easier for officials to justify shifting to a more supportive policy stance,” Julian Evans-Pritchard of Capital Economics said in a commentary. “The People’s Bank has already been nudging down market interest rates since the beginning of the year but is likely to take the more high-profile step of cutting benchmark lending rates in the coming months.”

CURRENCY: The dollar rose to 112.44 yen from 112.39 yen late Friday while the euro rose to $1.1701 from $1.1688.

ENERGY: Benchmark U.S. crude fell 37 cents to $70.64 per barrel in electronic trading on the New York Mercantile Exchange. It rose 1 percent on Friday to $71.01 a barrel in New York. Brent crude, used to price international oils, lost 10 cents to $74.23 per barrel.

Germany’s Deutsche Bank sees higher-than-expected Q2 profit

Germany’s biggest bank, Deutsche Bank, says it foresees considerably higher-than-expected earnings for the second quarter — results that it says underline the company’s “resilience.”

The Frankfurt-based bank said Monday it expects net profit of about 400 million euros ($467 million) for the April-June period. The company said its brief preliminary earnings statement, ahead of a full earnings report July 25, was triggered under German regulatory rules by the fact the results are far above analysts’ average forecast. For net income, that was 159 million euros.

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The bank has struggled to cut costs and return to profit after three straight full-year losses. The latest figures appear to be good news for new CEO Christian Sewing, and the company said “management believes that these results demonstrate the resilience of the franchise.”

Emaar Malls announce new digital-focused CEO to take over in August

Emaar Malls will have a new CEO from August, according to a disclosure filed to the Dubai Financial Market.

Emaar Malls said Patrick Bousquet-Chavanne will join as CEO, where “he will focus on preparing our malls business for tomorrow’s challenges and further increase our customers’ trust, strengthen tenant relationships and enhance the digital experience.”

Prior to joining Emaar Malls, Bousquet-Chavanne worked at Marks Spencer, where he served as chief marketing and digital officer, helping position MarksAndSpencer.com as one of the UK’s foremost clothing and footwear retail websites.

According to the statement, Emaar Malls’ current CEO, Nasser Rafi – who led the company when it was successfully listed on the DFM in 2014 – has “decided to take up new challenges.”

Rafi’s new post within Emaar Group “will be announced later”, according to the statement.

In April, Emaar Malls announced that over 35 million people visited Emaar Malls in Q1 2018, a 3 percent increase over the same period last year.

The announcement came on the same day as the company announced a net profit of AED 548 million ($149 million) in Q1 2018, slightly above the AED 539 million ($147 million) recorded in Q1 of the previous year.

For all the latest retail news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.

Emirates NBD declares $38.9 million exposure to Abraaj

Emirates NBD has exposure to embattled private equity firm Abraaj through a $21.3 million investment in the management group, the bank said in a disclosure to the Dubai Financial Market. 

Additionally, the disclosure added that Emirates NBD has a total exposure of $17.6 million across three separate Abraaj funds.

With the disclosure, Emirates NBD becomes the latest in a growing list of companies with exposure to Abraaj, with recent additions including Shuaa Capital, Ajman Bank and the Commercial Bank of Dubai.

Other companies that have declared direct or indirect exposure to Abraaj include First Abu Dhabi Bank, Air Arabia and Union Arab Bank.

Aramex, Damac, Emaar Properties and RAK Ceramics have said that do not have any exposure to Abraaj.

Founded in 2002 by Arif Naqvi, Abraaj had nearly $14 billion of assets under management before being granted a court-supervised restructuring last month in the Cayman Islands, where it is registered, following allegations of the misuse of funds. The Cayman Islands court appointed liquidators to oversee an “orderly restructuring” of the group.

Four key investors in a $1 billion healthcare fund managed by Abraaj, including Bill and Melinda Gates and a World Bank affiliate, have demanded an inquiry into allegations that money from the fund had been misused.

That in turn triggered investor demands for their funds to be returned. Abraaj had the funds to repay secured investors but could not repay unsecured investors.

The company categorically denied any wrongdoing.

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Bahrain needs a comprehensive package of economic reforms, says IMF

Bahrain needs a comprehensive package of reforms to reduce its fiscal deficits over the medium term, the IMF said, as the island kingdom seeks to secure crucial support from rich neighbours to avoid a currency devaluation.

“Despite planned fiscal consolidation measures, fiscal and external deficits are projected to continue over the medium term, due to the large and growing interest bill,” IMF’s Executive Board said in a report on Sunday.

“Public debt is expected to increase further over the medium term and reserves are projected to remain low,” it added.

Bahrain, one of the most vulnerable Gulf Arab economies to lower oil prices, confirmed last month that it was in talks with Saudi Arabia, the UAE and Kuwait for support that would help reduce ballooning debt and shore up foreign-exchange reserves.

The country hired investment bank Lazard Ltd. to advise on how to repair its strained public finances, people with knowledge of the matter said earlier this month.

The IMF emphasised the need to “introduce direct taxation, including a corporate income tax, while containing the public wage bill and targeting subsidies to the poorest” and said Bahrain’s exchange rate peg to the dollar “remains appropriate for the economy.”

The IMF said it looked forward to the newly established debt management office to develop a contingent financing strategy to mitigate financing risks and costs.

“Delays in implementing a “credible fiscal plan and changes in market sentiment as global financing conditions tighten present downside risks.”

For all the latest business news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.

Oil falls below $71 as Saudis are said to offer extra crude to some buyers

Oil retreated below $71 a barrel after Saudi Arabia was said to offer extra crude supplies to some customers as OPEC’s biggest producer plans to boost output, while the US is considering tapping into its emergency stockpiles to rein in prices.

Futures in New York slid as much as 0.8 percent, after falling 3.8 percent last week. Saudi Arabia offered additional cargoes of its Arab Extra Light crude to at least two buyers in Asia for August, people with knowledge of the matter said, after supplying full contractual volumes to customers in the region.

Meanwhile, the US government is said to be mulling the release of oil from the nation’s 660-million-barrel Strategic Petroleum Reserve.

Crude has been weakened by fears that global demand will be hurt by trade tensions between the US and China, after prices hit a three-year high last month on prospects of a supply crunch.

Investors are watching for signs that members of the Organization of Petroleum Exporting Countries and its partners are moving to fill any potential gaps in supply caused by renewed US sanctions on Iran, falling output in Venezuela and sporadic disruptions in Libya.

OPEC and its partners could increase production by more than the 1 million barrels a day agreed under a deal last month if needed, Russia’s Energy Minister Alexander Novak said.

Still, the group’s Gulf members may need to pump almost as much oil as they can to cover swelling output losses, according to the International Energy Agency.

“Going forward, we may see OPEC members with the ability to ramp up output seek to grab more market share, whereas other nations such as Iran and Venezuela trying to stick to the agreement,” said Ahn Yea Ha, a commodities analyst at Kiwoom Securities Co.

“It’s unclear whether the US will actually use the emergency inventories, but we can at least tell that they feel a lot of pressure from crude trading above $70 a barrel.”

West Texas Intermediate crude for August delivery fell as much as 59 cents to $70.42 a barrel, and traded at $70.68 on the New York Mercantile Exchange at 12:26 p.m. in Seoul. Total volume traded was about 44 percent below the 100-day average. Prices dropped $2.79 to $71.01 last week.

Brent for September settlement lost 37 cents to $74.96 a barrel on the London-based ICE Futures Europe Exchange. Prices fell 2.3 percent last week. The global benchmark crude traded at a $5.36 premium to WTI for September.

For all the latest energy and oil news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.

Middle East airlines cancel Najaf flights amid growing unrest

A number of Middle East airlines have halted flights to the Iraqi cities of Najaf and Basra after days of protests and unrest.

On Friday, hundreds of protestors stormed the Shi’ite holy city’s airport, part of larger protests about corruption and poorly managed government services that have wracked the southern port city of Basra for several days.

According to various news outlets, protesters in Najaf had entered the airport’s main hall. Some had reportedly crossed onto the airport tarmac.

Following the Friday incident, Iraqi transportation authorities announced that the airport would close. The airport re-opened on Sunday, the Iraqi Prime Minister’s Office said in an announcement.

In a statement, flydubai said that its flights between Dubai and Najaf – FZ221 and FZ222 – were cancelled “due to disruption on the ground at Najaf Airport until 22nd July 2018.”

“We are in touch with the relevant authorities and continue to monitor the situation,” a flydubai spokesperson said. “Our passengers can rebook to a later date or receive a refund.”

On Monday, Emirates also suspended its flights to and from Basra, EK945 and EK946, “due to political unrest at the airport.”

“We are in the process of rebooking customers with alternative flights and will send updated itineraries to them on contact details given in the booking,” a travel advisory on the Emirates website noted. “Customers are requested to ensure their contact details are correct by visiting the ‘manage my booking’ page.”

The advisory also noted that the airline is monitoring the situation and aims “to give customers as much notice as possible if there are any further changes to our operations.”

Passengers holding tickets to and from Basra are also being advised to check the status of their flight.

Royal Jordanian Airline, which operates four weekly scheduled flights to Najaf, announced that it was halting services from Amman “until further notice, in view of the security situation at Najaf Airport.”

With the announcement, Najaf becomes the ninth Royal Jordanian destination to be suspended for security reasons, in addition to Mosul in Iraq, Damascus and Aleppo in Syria, Tripoli, Benghazi and Misrata in Libya and Aden in Yemen.

Additionally, Kuwait Airways announced it was also halting flights, and that existing bookings would either be transferred to other companies or refunded without penalties.

For all the latest transport news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.

The Surprising Secret That Smart People Know About Communication

Here’s what The New York Times wrote about Thing Explainer: “The oversized, illustrated book consists of annotated blueprints with deceptively spare language, explaining the mechanics behind concepts like data centers, smartphones, tectonic plates, nuclear reactors and the electromagnetic spectrum. In his explanations, Mr. Munroe avoided technical jargon and limited himself to the 1,000 most commonly used words in the English language. This barred him from using words like helium and uranium, a challenge when describing how a rocket ship or reactor works.”

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