December edition of the MEFIC Macroeconomic Monthly. In this report, we specially analyse the recent extension of deal by OPEC and non-OPEC oil producers to extend the production cuts, and its impact on oil prices.

Key Highlights:

•  The coordinated cuts in oil production by OPEC and non-OPEC oil producers, appears to be working, as evident from rising oil prices and reducing surplus inventories.

•  Saudi Arabia Purchasing Managers’ Index (PMI) in November 2017 was the highest since August 2015.

• Bank credit growth continued its decline in October 2017, led by reduced exposure to mining and quarrying sector, as well as manufacturing .

•  Money supply in October recorded the highest decline in a year, led by sharp drop in time and savings deposits

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Monthly Macroeconomic Report-December 2017

November edition of the MEFIC Macroeconomic Monthly, with a special focus on Q3 2017 results of Tadawul listed companies. Our special edition provides insight on the sectoral performances as well as the leaders and laggards in each sector along with the market-wide top gainers and losers. Our universe of comprises of 94% of companies listed on Tadawul who have released their results till November 6, 2017

Key Highlights:

• Q3 Earnings – The latest earning season showed a strong reversal in most sectors after dismal Q2 2017 results. The bottom-line expanded by 20.0% (YoY) and by 28.1% compared to the previous quarter. Over Q3 2017, several sectors saw turnarounds in earnings. Strong earnings were mostly contributed by heavyweight sectors, but none the less, smaller contributing sectors like Energy, Capital Goods and Food Retailing saw large recovery in bottom-line.

• Oil production – KSA produced 10.01 million barrels of oil per day (mbpd) in October 2017, to keep just in line with production limit.

• Inflation – Deflation remained unchanged during Sept-17 at -0.1%, however extending it for the ninth straight month. Consumer demand continues to be weak in key areas.

• ATM withdrawals– Private sector spent less during September as ATM withdrawals plummeted 13.4% YoY after improving for the previous two months

• Credit growth – Credit growth declined marginally by 0.7% MoM in September, as total deposits fell at a similar rate

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Monthly Macroeconomic Report-November 2017

The Saudi Arabia Macroeconomic Monthly Review October 2017, offers an extensive view of the Saudi Arabian economy and the key trends across various fields.

As special topics of analysis, we review the Q2 2017 GDP and Saudi Arabia’s debt issuances over the past few years, in the first part of the report, i.e. Executive Summary and Review section. We also present a quick look at the key indicators that signal the health of Saudi Arabian economy.

The second part – the detailed Chart Pack section – in turn, is divided into five sub-sections

• Macroeconomic indicators: We take an extensive review of the Saudi Arabia’s macro economy via a set of 45 indicators ranging from GDP to sector specific data volumes and prices

• Oil indicators: With crude oil being a key driver of Saudi Arabian economy, we analyse oil production, demand supply, exports, not just for KSA but for OPEC as well

• Stock market indicators: We review the performance of Tadawul along with turnover, ownership and investments

• Corporate Earnings: We track the trend of TASI listed companies’ financials – Sales, EBITDA, Net income and margins – at both quarterly and annual intervals

• Tadawul Sector Earnings Performance: The most recently published quarterly net income is aggregated at sector level and compared on a year-on-year and quarter-on-quarter basis to highlight the sector leaders and laggards

For a quick glance at the whole economy, at the end of the report, we present key statistics related to Saudi Arabia, spanning economic output, budget, trade, oil, inflation and demographics.

With uncertain direction of equity markets and volatility in global commodities, an analytical and fundamental research of macroeconomic trends becomes imperative to take well-informed decisions.

We hope you find the report valuable to your analysis and a key input in your decision-making. For any feedback or suggestions, kindly reach out to investmentresearch@mefic.com.sa

Monthly Macroeconomic Report-October 2017