Today’s Trading Playbook
KEY THEMES
Oil prices continued to soar on the first day trading of the week, reaching levels not seen before since October 2018 and November 2014. The tenuous rally, which kicked off with oil prices around USD16/bbl mid-2020, has elevated prices to trade this morning above the USD85/bbl mark. Reasons continued to be the bounce in power demand that is unmatched with high coal and natural gas prices. This, in return, throws the ball to fuel oil, being a cheaper alternative at the moment, hence stimulating demand for more oil barrels. For more details, please read our Trading Playbook issued on 4 October 2021.
Elsewhere, the EGX 30 is now running on a hot nine-day winning streak, which sparked on 4 October’s trading session, gaining nearly 790 points or 7.6% amid a slight improvement in trading activities. The current recovery so far in October is mainly anchored around CIB [COMI], followed by EK Holding [EKHO], besides Fawry [FWRY], and Ezz Steel [ESRS], which reestablishs the notion that the shift from small- to large-cap preference is building up. Despite the 9-day winning streak, the EGX 30 still trades at 2022e P/E of only 7x (i.e. earnings yield of 14.3%).
Now, on to the top news and analysis for the day.