Perspectives July & August Publication

Welcome to the sixth edition of Perspectives.

The first half of the year is ending and despite some shaky sessions at the end of June, global equities had their best first half of the last 19 years. Emerging markets were very strong but even the S&P 500 performed well with its best first 6 months’ performance since 2013. Another remarkable fact has been the “Goldilocks” nature of this rally as US equities, long duration US Treasuries and Gold all ended the period with gains between 8% and 9%. Par pure coincidence, our Middle East equities fund generated similar gains in the first half (+9.1% to be precise) despite challenging MENA equities markets. This shows that effective active management can make a difference in our region.

Coming back to international markets, our “Investment Strategy” section looks into more details at the mid-year perfor¬mance of the main asset classes and highlights some of our thoughts regarding the next 6 months. The Hot topic of this month is about the “FANGs”; we assess the risk for the US Technology mega-caps to become the new casus belli for both politicians and regulators. This Summer edition of Perspectives includes a special focus on Bitcoin, as the crypto¬currency is the best performing asset class so far in 2017, with a gain of 160% (after a similar rise in 2016).

The second part of this monthly publication is dedicated to our regional equity markets. We first have a close look at some key statistics for UAE equities as of the end of June. We then make a “bull” case on Saudi banks. Last but not least, to follow-up on the June edition of Perspectives, we share our views on the decision by MSCI to include Saudi Arabia in the Emerging Markets index watch-list.

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