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Move with clarity.نستمد وضوح رؤيتنا من عمق خبراتنا وأبحاثنا لنرى ما هو أبعد.

Selective outside the US

• European banks earn well while rates are high, and they are paying it back through dividends and buybacks.
• European utilities are being paid to build out the electricity grid.
• The rest of the European index is luxury, autos and industrials that live or die on Chinese demand, and Japan's reform story is already in the share prices.

Earnings, not interest rates

• Yields went up because the economy is growing, not because something broke.
• AI spending now shows up in reported profits at Nvidia, Microsoft, Alphabet and Amazon, not just in forecasts.
• That spending is spreading to power producers, electrical equipment makers and mid-sized industrials.
• The market is concentrated in a few names, which we hedge rather than avoid.

Invested, with hedges on

• Companies are still growing profits and very few are defaulting.
• Central banks are easing off the brake, not pressing it.
• We stay invested in larger, better financed companies and hold hedges against a shock.

Oil pays the bills

• A higher oil price means higher government revenue, which funds Vision 2030 spending.
• Banks and contractors are the first to see that spending.
• Local investors have kept the market steady while the region around it has not been.

The chipmakers, not the index

• We own Korea and Taiwan: Samsung, SK Hynix and TSMC make the memory and the chips the AI build runs on.
• We do not own the broad emerging market index, which is mostly China and commodity exporters.
• We have cut dollar-denominated emerging market bonds, where the extra yield no longer pays for the risk.

A supply story, not a trend

• Oil is high because supply is disrupted, not because demand is booming.
• Diesel is the tightest part of the market and the quickest route from disruption to inflation.
• Copper and the industrial metals have already run hard on global growth.

No reason to own long bonds

• The 10-year Treasury yield is near 5 percent, the highest since 2023.
• It is there because the economy is growing faster than the policy rate, not because of a crisis.
• We take the yield in short-dated bonds and hold inflation-linked bonds for protection.

Good yield, no margin for error

• The extra yield that corporate bonds pay over government bonds is near its lowest in decades.
• Investment grade is the worst of it: a small move wipes out a year of that extra income.
• We prefer mortgage-backed bonds and senior bank loans, which still pay you for the complexity.

Gulf carry, chosen name by name

• Saudi Arabia is the largest bond issuer in the region and the paper comes with a real yield pickup.
• Gulf government finances are sound at the current oil price.
• We stay in shorter maturities, so we are paid for taking credit risk rather than interest rate risk.