Figures released by EY indicated that capital raised through initial public offerings (IPOs) in the Middle East & North Africa (MENA) region totaled $881.5m in the second quarter of 2018, up by 42.8% from $617.4m in the same quarter of 2017. There were nine IPOs in the MENA region in the second quarter of 2018, relative to eight IPOs in the same period of 2017. Capital raised through IPOs in the MENA region accounted for 2% of the total worldwide, while the number of IPO deals in the region represented 2.8% of the number of global IPOs. Also, seven IPOs in the GCC region raised a total of $780.3m in the second quarter of 2018. On a country basis, four IPOs in Saudi Arabia raised $517.7m in the second quarter of 2018, which is equivalent to 58.7% of the MENA region's total; followed by one IPO in each of Egypt, Morocco and Oman that raised $57.2m (6.5%), $44m (5%) and $12.8m (1.5%), respectively. Further, IPOs in the real estate sector raised $553m, or 62.7% of the MENA region's total, followed by the oil & gas sector with $225m (25.5%) and the financial services sector with $57.2m (6.5%). 
Source: EY

Arab stock markets improved by 8.3% and Gulf Cooperation Council equity markets increased by 9% in the first eight months of 2018, relative to increases of 1.8% and 0.9%, respectively, in the same period of 2017. In comparison, global equities grew by 1.7%, while emerging market equities regressed by 10.2% in the covered period. Activity on the Khartoum Stock Exchange jumped by 190.5% in the first eight months of 2018, the Tunis Bourse surged by 34.8%, the Qatar Stock Exchange grew by 16%, the Abu Dhabi Securities Exchange expanded by 13.4%, the Saudi Stock Exchange increased by 10%, the Egyptian Exchange rose by 6.6%, the Boursa Kuwait grew by 1.4%, the Damascus Securities Exchange improved by 1.3%, and the Bahrain Bourse expanded by 0.5%. In contrast, activity on the Beirut Stock Exchange declined by 22.3% in the first eight months of 2018, the Dubai Financial Market dropped by 15.7%, the Muscat Securities Market regressed by 13.3%, the Casablanca Stock Exchange decreased by 6.8%, the Palestine Exchange and the Amman Stock Exchange declined by 6.6% each, and the Iraq Stock Exchange retreated by 3.3% in the covered period. In parallel, activity on the Tehran Stock Exchange increased by 44% in the first eight months of 2018.  
Source: Local stock markets, Dow Jones Indices, Byblos Research

Fitch Ratings indicated that the sharp depreciation of the Turkish lira exposes banks to increased refinancing, funding, asset quality and capitalization risks. First, it said that Turkish banks face refinancing risks, given their reliance on external funding, with $102bn in foreign debt maturing in the next 12 months. The agency estimated the banks' refinancing requirements, net of more stable sources of funding, mainly from parent banks, at $55bn, which can be comfortably covered by banks. But it noted that a scenario whereby banks have to finance their foreign debt would weigh on the Central Bank of the Republic of Turkey's foreign currency reserves, policy rates and economic growth, and increase currency pressure. Second, it considered that deposit outflows could adversely impact the banks' funding and liquidity profiles, but noted that deposits have been broadly stable, as the decline in foreign-currency deposits was offset by higher local-currency deposits. Third, it expected the currency depreciation to weaken the banks' asset quality, given their high and concentrated foreign-currency loans. It forecast the banks' non-performing loans ratio to rise, given the borrowers' exposure to the lira's weakness, possible interest rate increases and weaker GDP growth. It said that the weaker asset quality should become visible in the banks' IFRS 9 disclosures at end-2018. Fourth, it anticipated the currency depreciation, higher interest rates and weaker asset quality to weigh on the banks' capital positions.   
Source: Fitch Ratings