KEY THEMES
With global investors starting to become a bit concerned about rising inflation (as evident in rising global commodity prices and yields), equities may start feeling the brunt. With MSCI EM up more than 10% ytd, EGX 30 is still lagging, up just above 5%. EGX 30 had also lagged MSCI EM in 2020, leaving room for the market’s main index to stage a strong recovery once foreign investors start coming back to the market. The current low interest rate environment has been a boon to global markets in general and the U.S. market in specific. However, moderately higher global interest rates may lead global investors to re-think their strategy by reducing exposure to developed markets (the U.S. included) and look elsewhere for laggards, such as EGX 30.