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With developers continuing to scale back on completion of launched and often pre-sold projects, the number of new homes handed over in Q2 totalled only 2.8k; industry expectations were that up to 40k residences would be handed over this year – in fact that number will struggle to reach 15k, with only 5k units delivered so far in 2016. Indeed, according to a Cavendish Maxwell report, 71% of units, that were expected to be handed over, have been delayed and a further 12% placed on hold. This tightening of the supply pipeline should negate any further price falls, as demand continues its upward trend.

Figures from the Dubai Land Department indicate that in H1, US$ 13.1 billion, from 21.8k transactions, were invested in the Dubai realty sector. Of that figure, five nationalities accounted for 57.4% of the total – UAE – US$ 3.3 billion, India – US$ 1.6 billion, Saudi Arabia – US$ 995k, UK – US$ 902k and Pakistan – US$ 728k.

Cavendish Maxwell have reported marginal Q2 declines in both Dubai apartment and villa prices, whilst over the past 12 months falls have been at 6% and 4% respectively. Meanwhile rents are showing marginal declines. The sector is still suffering from tight liquidity, consumer confidence and high deposit requirements from the financial institutions.

Core’s latest report sees a general softening in Dubai office rents, as stock levels continue to rise with a further 7.3 million sq ft, being built, adding to the current 90 million sq ft portfolio. In Q2, the property broker estimated that there were price falls of 10% in JLT, 6% along SZR and 3% in Business Bay, although Tecom and DIFC bucked the downward trend with rentals up 10% and 6% respectively.

Yet another Damac launch this week – this time phase 1 of The Beach at Navitas Hotel & Residences, comprising 3-bedroom apartments, with prices starting at US$ 341k. The 5-tower residential and hotel development will be located within the massive 55 million sq ft Akoya Oxygen project and will have all resort type facilities, including artificial beaches.

Al Shafar General Contracting will be the main contractor for the Vivanta by Taj hotel, to be built in JLT. Piling work has already started and completion date is set for Q4 2018.

The 304-key Aloft Dubai City Centre Deira, due to open in Q1 2018, will have an outdoor rooftop VOX Cinema. The property will also utilise Starwood’s keyless entry, allowing clients to use their smartphone for room access. The hotel will be Majid Al Futtaim’s 11^th in the country, whilst it will become Starwood’s 26^th, with a further 17 in the pipeline.

If Kleindienst, the firm behind Dubai’s The Heart of Europe development, have their way, the company will soon have the region’s first honeymoon destination. It is developing St Petersburg Island, a heart-shaped island, as a 5-star resort especially for newly-weds.

According to the Dubai Statistic Centre, Dubai’s permanent 2015 population was 2.4 million, with this figure boosted by the daily influx of 1.1 million souls, who live in other emirates but work in Dubai.

An agreement between the World Economic Forum, the UAE government and the Dubai Future Foundation will see the 2-day Shaping the Future annual meeting taking place in the emirate in November. The gathering will build on the work of the Global Future Councils.

The Al Naboodah Construction Group is expecting revenue to climb 75% this year, to US$ 954 million, as new management aims to better utilise related company links with its offshoots, including Arcon ready-mix concrete business, National Plant and Equipment and Trans Gulf (MEP).

Four-year old Careem, the local online taxi booking service, plans to spend US$ 100 million on R&D over the next five years. The company, with three million registered users, has already added 50 engineers in Pakistan and will open further centres in Egypt and Germany.

The 2016 Skytrax World Airline Awards saw Emirates voted the best airline in the world, as well as scooping the world’s best inflight entertainment and best regional airline.

Dnata continues on its acquisition trail – this time it has bought a majority shareholding in the UK’s Air Dispatch, with no monetary details available. This subsidiary of Chapman Freeborn Group provides loading services to airports in Prague and Warsaw and has Cathay Pacific, Qantas and Qatar Airways among its client base.

Although ME carriers posted an 11.8% jump in May air passenger numbers, compared to 4.5% the previous year, capacity increased by more – 15.6% (compared to the global average of 5.5%). IATA estimate that 2016 profits for the region’s airlines will rise by 14.2% to US$ 1.6 billion whilst the global increase will be lower at 8.5% to US$ 39.4 billion. (Some airlines must be making losses if Emirates, US$ 2.27 billion, and Qatar Airways Group – US$ 824 million – made such recent impressive profits).

According to Al Ansari Exchange, UAE expats remitted US$ 1.4 billion to their home countries over the last week of the holy month of Ramadan – 20% higher than last year, and three times the daily average. In 2015, the UAE Central Bank estimated that a sum of US$ 23.9 billion was remitted.

Although the June Emirates NBD Economy Tracker Index is marginally up to 54.6, it is still below the 3-year trend. However there were welcome signs of improvement in two main sectors – retail at 58.2 and tourism at 54.1; even the maligned construction segment had a positive reading of 51.5. Despite these rays of sunshine, there was no improvement in employment numbers, in contrast to the past four-year upward trend.

The June Emirates NBD UAE Purchasing Managers’ Index posted a monthly fall from 54.0 to 53.3 that is lower than the 3-year 56.3 average. One contributing factor to the sluggish figures could be attributable to the start of the holy month of Ramadan. However, non-oil private trade continued to improve, as higher output and new orders shored up a marginal improvement in the sector.

UAE’s Q1 direct non-oil trade, at US$ 73.4 billion, was slightly down on the same period in 2015; 40.2% (or US$ 29.5 billion) of the total emanated from Asia, Australia and the Pacific, whilst Saudi Arabia was the leading regional partner. Imports – at US$ 45.3 billion – comprised 61.6% of total trade, with reexports, at US$ 15.4 billion, and exports of US$ 12.7 billion making up the balance. Whilst the country’s trade momentum has been somewhat subdued, the slowdown in global trade is reflected in these figures. (Credit Suisse has predicted a 2.9% growth this year for the country’s non-oil economy, followed by 3.7% in 2017).

With its US$ 500 million Tier 1 Sukuk, Noor Bank’s listing became Nasdaq Dubai’s 11^th of the year and brought the total value of Shariah bonds on the exchange to US$ 44.6 billion.

The DFM opened on Sunday at 3371 and regained all the previous week’s losses and more, rising 3.0% to close the week on 3472 by Thursday (14 July 2016). Volumes, on the last day of the trading, were at 530 million shares, valued at US$ 187 million, changing hands, (cf 289 million shares for US$ 116 million, the previous Tuesday). Bellwether stock, Emaar Properties, surged US$ 0.11 to US$ 1.83, whilst Arabtec also moved north by US$ 0.02 to US$ 0.41.

Brent crude recovered somewhat and closed the week US$ 0.97 up at US$ 47.37 – whilst gold headed the other direction – down US$ 30 to US$ 1,332 by the Thursday (14 July 2016) close. (Iran’s oil exports at 2.6 million bpd have almost reached pre-sanction levels).

It came as no surprise to see Which? reporting that several UK banks have been charging customers several times the fees, compared to payday lenders. It seems that for borrowing US$ 130 for 28 days, customers of HSBC, Lloyds, RBS and TSB could be charged between US$ 104 and US$ 117 – four times higher than the maximum charged by a payday loan institution.

It seems that the seven bidders to acquire Tata Steel’s UK operations will now face serious international competition, as the Indian conglomerate has decided to “look at alternative and more sustainable portfolio solutions for the European business”. At least three major players – China’s Hebei Iron & Steel, India’s JSW Steel and ThyssenKrupp AG – could be interested in JV agreements with Tata Steel. There could be several sticking points in relation to the inclusion of its UK business, employing 15k, including resolution of the US$ 950 million British Steel pension fund liability and government assistance with any bailout.

Boeing could lose out on a potential US$ 25 billion order, with the House of Representatives passing a motion to block US aircraft sales to Iran. Any ban would have to be approved by the Senate. In January, Airbus won an Iranair order for 118 units, with Boeing later reaching a similar preliminary agreement.

Mitsubishi Aircraft Corp’s attempt to break the Embraer and Bombardier duopoly in the regional jet sector received another boost with a 20-aircraft order for its 92-seat MRJ90 from leasing company Rockton; this comes after a similar order earlier in the year from Aerolease Aviation LLC.

Meanwhile, Airbus has announced that it will cut the delivery of its A380s form its current annual level of 27 to 12 per annum as from 2018 – a sign of disappointing sales and a shorter than expected life span?

Pokemon’s first foray into mobile gaming hit the jackpot as GO’s runaway triumph saw the company’s shares jump 86%, to gain US$ 17.0 billion in just two days of trading, following its 06 July launch. Since the app, that has been released only in the US Australia and New Zealand to date, is free, Pokemon investors are unlikely to reap the dividends that the game’s success should warrant.

After last week’s Amazon announcement that it was creating 1k jobs, the UK received another fillip on Monday with news of a further 2k new jobs, as a result of a government agreement with Boeing. The deal involves expanding the US planemaker’s UK research operations and the purchase of 9 Boeing P8 maritime patrol aircraft.

Saudi Arabia’s Kingdom Holding has lost US$ 40 million because of the recent fall in sterling. The company agreed to trade its US$ 3.2 billion stake in FRHI Holdings – owner of the Raffles and Fairmont brands – for a 5.8% share in the French hotel group, Accor, US$ 339 million cash and other assets, including a stake in California’s Claremont Hotel and increasing its stake in London’s Savoy to 58.8%.

Three major elections were settled this week. Following his success, Prime Minister Shinzo Abe, Japan has slashed two major forecasts – growth from its January estimate of 1.7% to 0.9% and inflation from 1.2 to 0.4%. With the three arrows of Abenomics – monetary, fiscal and structural – continuing to miss their target, it is inevitable that a further stimulus package (up to US$ 200 billion) will soon be implemented.

The markets initially reacted favourably to news that the incumbent Australian Prime Minister, Malcolm Turnbull, scraped home, a week after the actual election. However, the Conservative leader will face many problems including the distinct possibility of a credit rating cut of the country’s coveted AAA status, declining consumer confidence and a ballooning trade deficit.

Theresa May became the UK’s Second ever Prime Minister and the 13^th in the Queen’s 64-year reign. Her first job appeared to be the axing of the Chancellor George Osborne to be replaced by Philip Hammond. The markets seemed to take the ministerial changes in their stride, with Thursday’s closing of sterling at 1.32 to the US$, FTSE 100 at 6662 and FTSE 250 at 16775.

Following May’s blip, when only 11k new jobs were created, normality returned to the US economy with June figures coming in at a healthy 287k. The jobless rate – measured by the number of unemployed actually looking for work – rose 2 notches to 4.9%, whilst the monthly wage growth was a disappointing 0.1% (2.6% year on year). If there is further encouraging economic data in the coming weeks, a Fed rate hike could be on the cards for September.

Now that a revision has been made to the level of its capital assets, brought about by the number of aircraft imported by leasing companies and other reclassifications, Ireland has amended last year’s impressive 7.8% growth to a spectacular 26.3%. The country’s economy has been bolstered by the fact that it is the home of many overseas companies, redomiciling there for favourable tax reasons.

The IMF has revised forecasts for the Italian economy in the wake of the Brexit vote – to under 1% this year (from 1.1%) and 1% in 2017 – down from 1.25%. Other analysts indicate even lower growth for the Eurozone’s third biggest economy. In the unlikely event that the country fully implemented all recent reforms, it would probably only reach its 2008 peak after a further decade; this compares to other eurozone countries that would be 25% higher by 2025. Italy’s cause will not be helped by high unemployment level, bank debts totalling US$ 398 billion and a rising public debt, currently at 132.9% of GDP – with only Greece in a worse state.

The EU has been beset with internal problems largely of their own making – structural weaknesses, high unemployment and soaring debt levels. Nevertheless the EU has been looking for some excuse to explain its miserable economic performance over the past few months and has been handed one on a plate – the UK Brexit.

Now this is one of the main factors behind the IMF’s decision to cut its 2017 growth forecast for the bloc from 1.7% to 1.4%, with 2016 marginally down to 1.6%. Others include political and economic uncertainty, market volatility and falling investor confidence. (The IMF has a past record of consistently changing forecasts downwards on a regular basis).

A bigger worry to the EU has to be the state of its banking system; for example, Italy may need external assistance as its financial institutions are awash with bad loans. However, the IMF’s main concern is Deutsche Bank which it considers the biggest single risk to the global financial system of the world’s top 29 banks. If that were to suffer, then expect carnage in the markets.

A US Congressional report seems to confirm what many already know – big banks have too much sway with governments. It seems that although HSBC was accused, in 2012, of money laundering for drug cartels – and subsequently paid US$ 1.9 billion in settlement – it never faced criminal charges nor saw any of its top officials prosecuted. The report alleges that the UK government “influenced” the outcome and “hampered” the probe with Chancellor George Osborne “intervened in the HSBC matter by sending a letter to Federal Reserve Chairman Ben Bernanke… to express the UK’s concerns regarding US enforcement actions against British banks”.

Although not the only entity, Goldman Sachs has a history of apparent collaboration with global governments and institutions. In 2009, it is reported that the bank received US$ 20 billion in bailouts, payments and backstops under the Obama administration – that year it paid out US$ 16.2 billion in bonuses. Interestingly, the likes of Robert Rubin (Treasury Secretary in the Clinton administration), Henry Paulson (Treasury Secretary – Obama) and Mark Patterson (Chief of Staff Treasury) were three of many who had previously held important positions In Goldman Sachs – as Co Chairman, CEO and lobbyist respectively.

Governor of the Bank of England, Mark Carney, spent 13 years with the bank in various countries. President of the ECB, Mario Draghi, is not only a member of the lobbyist Group of Thirty but also worked for Goldman Sachs from 2002 – 2005. Even Prime Minister, Malcolm Turnbull, was MD Australia and partner in the bank for four years to 2001.

The latest episode sees the former head of the EC, Portugal’s Jose Manuel Barroso, taking up a job advising the US bank on the consequences of Brexit – this comes 20 months after he stepped down from his presidency. There is something called conflict of interest or is it that some of out politicians, bureaucrats, fat cats and financiers are benefitting, at our expense, Living In The Gangsta’s Paradise?

CBRE’s latest report indicated that slowing job growth and the negative impact of new supply were the main drivers behind Dubai Q1 residential rents and sale prices dropping on average by 2%. This comes on the back of a 4% slump in the previous quarter. The consultancy estimated that 15k residential units could be completed this year, with Dubailand, Dubai Silicon Oasis and Jumeirah Village the top locations.

A shortage in prime office space has seen a 20% Q1 hike in certain locations, such as DIFC, compared to 2015, but the falling vacancy rates are not apparent in other areas. The JLL Global Office Index indicated that Dubai maintained its position as MENA’s top performer in this sector.

Emaar Properties has awarded Arabian Construction Company the contract to build Boulevard Point. The luxury 63-storey tower, comprising 297 apartments, will be the ACC’s third project in Downtown.

Choice Hotels International has signed an agreement with Equinox Group and Al Tayyar Travel Group to develop its three mid-scale brands – Clarion, Comfort and Quality – into the UAE and Saudi Arabia. It is expected that 25 hotels, with 8k rooms, will be built over the next five years.

Lemon Tree Hotels has also announced that it will introduce at least 8 properties, in the 3 / 4 star brackets, over the next three years. The Indian chain has signed an agreement with the Australian real estate company, Raine and Horne.

The Wyndham Hotels Group is another interested party looking to expand operations in the UAE and is in negotiations with potential investors. The US-based operator is one of the largest in the world, with several well-known brands that could gain traction including Dolce Hotels & Resorts, Days Inn, Howard Johnson and budget chain, Super 8.

Dubai (with 361k sq mt) has been ranked, along with Abu Dhabi, as 17^th in CBRE’s Global Shopping Centre Development report, with a total of 627k sq mt of total retail space under construction. Dubai still rates a worldwide 2^nd for international brand presence. Within the next two years, two malls, Palm Mall in Dubai (111k sq mt) and The Point (48k sq mt), are expected to open.

It is reported that both Emirates NBD and CBD are in the market to raise finance; the former may be looking at refinancing a 2013 US$ 800 million facility and the latter a US$ 450 million loan due to mature this December. This could be a move to source funds before rates start moving upwards and comes after liquidity tightens, in the wake of falling oil prices.

In the same vein, S&P anticipate that Gulf banks will see a marked weakening in growth for the next 18 months, as assets increased much slower last year – Islamic banks fell from 12.3% to 7.0% whilst conventional banks slipped from 9.6% to 5.7%. The agency sees asset growth this year for both banking sectors at 5.0% but it also estimated oil prices would reach US$ 50 in 2018 (today’s price is almost there at US$ 46.70).

The Somaliland government and DP World have agreed to invest US$ 442 million, over time, in the Port of Berbera. The aim of the investment and management arrangement is to make the facility a ‘regional and logistic hub.’

Following last November’s decree, the emirate’s first PPP – public private partnership – has been announced, involving the government and a special purpose company established by Prince Khaled Bin Alwaleed bin Talal’s KBW Investments and the Indian transport firm ITNL. A 30-year concession has been granted for the building of one of the world’s largest automated car parks, to be located adjacent to the Dubai Courts. The total project includes a new Supreme Court building, 3k sq mt of retail area and 18.6k sq mt of office space.

Under new regulations, it is now easier for private homeowners to rent out their residences on short-term lets. If a proper holiday home licence is not obtained from the Dubai tourism authorities (DTCM), then owners could face penalties of between US$ 54 and US$ 5.4k. Repeat offenders could be fined up to US$ 27k. Furthermore, tenants can obtain a ‘no objection’ letter from their landlord and, if they meet the all the other requirements, they too can lease out their accommodation.

Dubai-based Green Energy Tomorrow will be the prime supplier for phase 1 of DP World’s initiative to install photovoltaic solar panels on all its buildings. The solar project, that generates electricity, is the largest of its kind in the ME and is part of the Dubai Integrated Energy Strategy 2030.

Bloomberg reports that GEMS Education could be considering an IPO as early as next year. In 2014, Blackstone, Fajr Capital and Mumtalakat acquired a significant minority stake in the business, whilst last month the school operator sought US$ 250 million finance, for expanding its school numbers, which currently stand at 78. Whether the 2017 economic environment will be suitable for a public listing remains to be seen.

The Investment Corporation of Dubai has bought a majority share in one of the world’s largest super yacht marinas – Porto Montenegro in Sarajevo. ICD reportedly spent US$ 288 million for a 53.2% stake from Canadian billionaire Peter Munk and joins other shareholders including Bernard Arnault, Lord Jacob Rothschild and Oleg Deripaska.

The April Emirates NBD Dubai Economy Tracker Index moved marginally higher to 52.7, as positive momentum returned to the market. The non-oil private sector index is an amalgam of individual indices, with all three key sub-sectors pointing to improved business conditions.

London-based Investec Bank has agreed a US$ 1 billion sale-and-leaseback arrangement with Emirates to finance four A-380s. The deal involves the bank to purchase the jumbos before leasing them back to the airline.

As widely expected, Emirates reported record profits – up by 56% to US$ 1.6 billion – for the year ended 31 March 2016. Although revenue was down 4% to US$ 23.2 billion, most other indicators headed north including passenger numbers by 8% to 51.9 million and capacity by 11%. It appears that the strong greenback cut US$ 1.6 billion off the revenue stream and US$ 1.1 billion from the bottom line. The carrier saw its fuel bill fall by 31% – now accounting for only 26% of its operating costs, compared to 35% last year.

Meanwhile Emirates Group declared a US$ 681 million dividend for ICD on the back of a 49.1% hike in profits to US$ 2.2 billion, despite a 3% reduction in revenue to US$ 25.3 billion. Over the year, employee numbers jumped 13% to 95k.

With flydubai and Qatar increasing their services, Q1 passenger traffic at DWC (Dubai World Central) rose 79.8% to 258k, whilst cargo fell 6.9% to 198k tonnes.

On a federal basis, the cabinet has approved a Shariah authority to monitor the expanding Islamic finance sector. The UAE Central Bank will be responsible for its establishment, with the new body supervising the Shariah boards of the individual financial institutions. In Q4, Islamic banks accounted for 22.2% of domestic credit, compared to 20.8% a year earlier.

Not known for their forecasting skills, the IMF has estimated the country’s 2016 fiscal deficit will widen to 7.2% of GDP but will improve thereafter, as oil prices and the global economy head north. It also expects that inflation will fall from 4.1% to 3.2%. The august body also commented that the Dubai diversified economy is holding up well and expects this year’s 3.3% growth forecast to jump to 5.0%, by the time of Expo 2020.

Damac Properties posted falls in both Q1 revenue and profit – by 33.3% to US$ 441 million and 14.6% to US$ 286 million – compared to the same period in 2015. During the quarter, the developer recorded sales of US$ 545 million, whilst delivering 0.3k units, and expects a further 2.7k to be completed this year.

Amlak Finance posted a 249% hike in Q1 revenue to US$ 99 million, whilst its profit figure jumped from US$ 2 million to US$ 28 million, compared to a year earlier. However, US$ 37 million of the turnover was attributable to a one-off sale of land. Total assets dropped 2.0% to US$ 1.8 billion.

Dubai-based Amanat Holdings reported a six fold increase in Q1 profit to US$ 3 million, as revenue doubled to US$ 5 million. During the quarter, the healthcare and education provider invested a further US$ 4.4 million in Sukoon International Holding, bringing its total investment in the Saudi company to US$ 14 million; it now owns a 33.25% stake.

Marka posted another quarterly loss, with a Q1 deficit of US$ 5 million. However, despite the strong US$ hurting revenue, the Dubai-listed company is confident in a turnaround of fortunes, with plans to double its retail space over the next year.

The DFM opened on Sunday at 3308 and nudged 1.1% higher to close on 3345 by Thursday (12 May 2016). Bellwether stocks, Emaar Properties and Arabtec, gained ground – both up by US$ 0.03 to US$ 1.74, and US$ 0.01 to US$ 0.41 respectively. Trading volumes were marginally lower on Thursday at 370 million shares, valued at US$ 113 million, changing hands, (cf 433 million shares for US$ 137 million, the previous Wednesday).

Brent crude surged this week – up 5.4% (US$ 2.38) to US$ 46.70 – whilst gold was flat at US$ 1,272 by the Thursday (12 May) close.

Recent figures show that Nigerian oil production of 1.7 million bpd is at its lowest level since 1994, largely because of the increased number of attacks on facilities. The latest has resulted in Chevron having to close down a platform producing 90k bpd.

After over 20 years as the country’s oil minister, former health minister and current chairman of Aramco, Khaled Al Falih, has replaced Ali Al Naimi. Last month, Saudi Arabia’s King Salman initiated major economic reforms, as the kingdom readies itself for a life with reduced dependence on oil revenues – emphasised by its 2015 budget deficit ballooning to US$ 98 billion.

After admitting that it had not been following the Japanese fuel consumption tests for the past 25 years, Mitsubishi Motors has seen its shares drop 40%. Now it seems that rival Nissan is in talks to take a 33.3% share, valued at US$ 2.2 billion, in the troubled automaker. Meanwhile the world’s largest car company, Toyota, has announced a Q1 4.0% drop in profit to US$ 3.9 billion; worryingly, it is expecting a further 35% profit plunge over the next 12 months.

Having acquired Sharp in March for US$ 3.5 billion, its new owner, Foxconn Technology Group, has a tough job ahead with the ailing tech company posting a massive US$ 2.4 billion annual loss (US$ 2.0 billion for the year ended 31 March 2015).

The EC has blocked the US$ 14.9 billion O2 sale to Three because of the fear of reduced customer choice and price rises, as the number of UK operators would have dropped to just three. The Hong Kong-based purchaser, CK Hutchinson, is considering the merits of an appeal.

Nokia reported a disappointing Q1 US$ 583 million loss, compared to a US$ 200 million profit in the same period last year. Revenue surged 89.6%, to US$ 6.3 billion, following its US$ 17.6 billion acquisition of French telecom operator Alcatel-Lucent during the year.

Disney is set to close its Infinity line of video games, as it booked a US$ 147 million charge mainly in regard to unsold inventory. It has found that developing games from scratch is a risky business and, in future, will go down the safer route of licensing its screen characters.

Shares in the US department store Macy’s dipped to a 4-year low, as its Q1 revenue fell 7.4% to US$ 5.77 billion and profits tanked 40%. After five straight quarterly falls, the retailer is not expecting any better news forecasting like to like sales down 4% for the rest of 2016.

Despite the Crown Office confirming that individuals associated with the near collapse of RBS will not face any legal action, shareholders may now continue with civil claims. The bank, 73% government owned, that had made a US$ 17.3 billion shareholder cash call in 2008, was “run” by Fred Goodwin, known as “Fred The Shred”. He was in charge when the bank paid US$ 72 billion for ABN Amro and racked up losses of US$ 34.6 billion in 2008 and lost 90% of its market value, resulting in the government bailout.

Australia’s biggest bank, Commonwealth reported a 4.5% hike in Q3 profits to US$ 1.7 billion, despite a jump of US$ 316 million in impairment expenses.

A PWC study indicates that regional IPO activity has all but dried up in Q1, with only one listing. The global slowdown, regional unrest and low oil prices continue to be the main drivers for the paucity of listings that has seen only two transactions completed over the past six months. In Q4 2015, the only regional IPO raised US$ 101 million on the Saudi stock exchange Tadawul, whilst this quarter has had the Middle East Healthcare Company (MEAHCO), for 30% of its shareholding raise US$ 471 million, on the same bourse. Meanwhile, on a global scale Q1 figures show a 72% decline to US$ 14.2 billion – its lowest level since the GFC.

The effect of the global economy continuing to slide can be seen from the fact that Q1 private aircraft sales recorded their biggest decline – 16% – in over five years. Billings fell to US$ 3.5 billion, compared to the US$ 4.2 billion in the same period of 2015. Drivers behind the decline include the energy sector slashing costs, record low commodity prices, just starting to rise, and the strong greenback – now beginning to lose some of its recent lustre.

The fact that its foreign exchange reserves rose to US$ 3.22 trillion is a sure indicator that Chinese capital spending is easing. March forex commercial bank sales of US$ 36.4 billion were 33.1% lower than recorded in January. Last June, the reserves peaked at US$ 3.99 trillion but, following a burst of international activity, there has been a marked slowdown in capital outflows. If this continues, it could have a positive impact on the stabilisation of the yuan.

Once again China’s trade figures cause concern in global markets as April exports and imports both fell by 1.8% and 10.9% respectively, compared to a year earlier. These figures were a lot weaker than expected and could point to further fragility in domestic demand, despite public capital spending projects.

The US April labour figures disappointed the markets, as only 160k jobs were added, compared to March’s 208k and recent months’ averages of over 200k. The slowdown, in tangent with an increase in wage levels, up 2.5%, could see the country’s inflation move north that in turn may prompt the Fed to look at upping bank rates as early as next month. The jobless rate was static at 5.0% but there was a marked increase in numbers no longer in the work force.

There was more bad news for the UK economy, ahead of next month’s Brexit vote as the Q1 trade deficit of US$ 19.2 billion was the biggest since 2008. This figure was US$ 1.6 billion more than the previous quarter, largely because of a US$ 2.7 billion hike in imports, whilst exports rose by only US$ 725 million. (This was in direct contrast to Germany, whose March trade surplus hit a record high of US$ 26.9 billion). For the third time since the GFC, UK manufacturing has gone into recession, having fallen 0.4% for each of the past two quarters. This is the main driver in slowing the country’s growth prospects that have now been pegged back.

The weekend saw the start of a 3-day general strike in Greece in protest to more austerity programmes as a quid pro quo for further US$ 5.8 billion bailout funds. For Prime Minister Alexis Tsipras, this continues to be a fine balancing act, as he was elected on an anti-austerity platform and his parliamentary majority is wafer thin, having 153 seats in the 300-seat house. On Sunday, parliament approved a bill reforming the country’s debt-ridden tax and pension systems.

With the number of consumers expected to increase by 1.1 million by 2020, many UK lenders have extended their mortgage age limits, with the likes of Nationwide increasing the maximum age to 85, Halifax 80 and Santander to 75. The fact is that people are working and living for longer and that many expect to be paying off mortgages during their retirement; this has prompted a major turnaround by some financial institutions. In another move, Barclays has offered 100% mortgages to those whose parents or friends deposit 10% of the value of the house with the bank for three years. Banks have still not learnt from the GFC – wait until house prices begin to fall, and rates move up, then once again who will be left Picking Up The Pieces!