Dollar Strong, Stocks Creep Higher as Second Trump Term Dawns

A teller sorts US dollar banknotes inside the cashier's booth at a forex exchange bureau in downtown Nairobi, Kenya February 16, 2024. REUTERS/Thomas Mukoya/File photo
A teller sorts US dollar banknotes inside the cashier's booth at a forex exchange bureau in downtown Nairobi, Kenya February 16, 2024. REUTERS/Thomas Mukoya/File photo
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Dollar Strong, Stocks Creep Higher as Second Trump Term Dawns

A teller sorts US dollar banknotes inside the cashier's booth at a forex exchange bureau in downtown Nairobi, Kenya February 16, 2024. REUTERS/Thomas Mukoya/File photo
A teller sorts US dollar banknotes inside the cashier's booth at a forex exchange bureau in downtown Nairobi, Kenya February 16, 2024. REUTERS/Thomas Mukoya/File photo

The dollar was firm and Asia's stock markets were cautiously positive on Monday as investors waited for an expected flurry of policy announcements in the first hours of Donald Trump's second presidency and eyed a rate hike in Japan at the end of the week.
Trump takes the oath of office at noon Eastern Time (1700 GMT), and promised a "brand new day of American strength" at a rally on Sunday, Reuters said.
He has stoked expectations he will issue a slew of executive orders right away and, in a reminder of his unpredictability, launched a digital token on Friday, which soared to trade above $70 at one point for a total market value north of $15 billion.
Monday is a US holiday, so the first responses to his inauguration in traditional financial markets may be felt in foreign exchange, where traders are focused on Trump's tariff policies, and then in Asian trade on Tuesday.
US equity futures were a fraction weaker in the Asian morning on Monday while the dollar, which has rallied since September on strong US data and as Trump's ultimately successful political campaign gained momentum, held steady.
Japan's Nikkei rose 1%.
Last week the S&P 500 notched the biggest weekly percentage gain since early November and the Nasdaq its largest since early December on some benign inflation data.
The dollar is up around 8% on the euro since September and at $1.0273 is not far from last week's two-year high. But so much is priced in that some analysts feel a more gradual start to US tariff hikes may draw out some sellers.
"A forceful start to Trump's new term could rattle nerves and give the dollar more support," said Corpay currency strategist Peter Dragicevich.
"By contrast, based on what already looks baked in, we think a more measured approach may ease fears and see the dollar lose ground, as it did after Trump took charge in 2017."
Trump has threatened tariffs of as much as 10% on global imports and 60% on Chinese goods, plus a 25% import surcharge on Canadian and Mexican products, duties that trade experts say would upend trade flows, raise costs and draw retaliation.
The Canadian dollar touched a five-year low of C$1.4486 per dollar on Monday. The Mexican peso hit a 2-1/2 year low of 20.94 per dollar on Friday.
Bitcoin dipped in the early part of the Asian day but remained above $100,000. Benchmark 10-year Treasury yields closed out Friday at 4.61%, up nearly 100 basis points in four months.
CHINA FOCUS
China is in focus as the target of the harshest potential trade levies. Investors lately cheered better-than-expected Chinese growth data and a Friday phone call between Trump and Chinese President Xi Jinping that left both upbeat.
"Basically everyone is waiting for these trade negotiations to begin and see what kind of attitude Xi Jinping takes with Trump," Ken Peng, head of Asia investment strategy at Citi Wealth told reporters in Singapore at an outlook briefing.
"That relationship between the two gentlemen has become very important as a leading indicator of policies."
Chinese equity markets rose last week and futures pointed to modest gains for Hong Kong shares at the open.
The yuan is seen likely to slowly adjust to any shifts in trade policy and was marginally firmer at 7.3355 per dollar in offshore trade.
The Australian dollar, sensitive to trade flows and China's economy, has scraped off five-year lows and, according to Commonwealth Bank strategist Joe Capurso, could test resistance at $0.6322 if Trump's policy changes fall short of market expectations. It was last at $0.62.
Japan's yen rallied last week as remarks from Bank of Japan policymakers were taken as hints that a rate cut is likely on Friday.
It was last steady at 156.17 per dollar and rates markets priced about an 80% chance of a 25 basis point rate hike.
In commodities gold hovered at $2,694 an ounce and Brent crude futures ticked higher to $81.21 a barrel.



Saudi Arabia: Rising Demand for Housing Units Drives Property Prices Higher

Residential and commercial real estate in the Saudi capital, Riyadh (Asharq Al-Awsat)
Residential and commercial real estate in the Saudi capital, Riyadh (Asharq Al-Awsat)
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Saudi Arabia: Rising Demand for Housing Units Drives Property Prices Higher

Residential and commercial real estate in the Saudi capital, Riyadh (Asharq Al-Awsat)
Residential and commercial real estate in the Saudi capital, Riyadh (Asharq Al-Awsat)

Real estate experts have attributed the ongoing rise in Saudi Arabia’s property price index, over 16 consecutive quarters, to significant and growing demand for housing units.

This trend is supported by the success of government-backed housing projects in attracting consumer interest, the evolution of financing mechanisms, and flexible credit facilities and subsidized financing programs offered by banks.

Experts predict that property price increases, particularly in major cities, will persist through the upcoming quarters of 2025 if the launch of new housing projects continues. The real estate price index saw a 3.6% year-on-year increase in the fourth quarter of 2024, marking the fastest growth since the first quarter of 2021.

According to the General Authority for Statistics’ quarterly report on property prices for the fourth quarter of 2024, the index was primarily driven by a 3.1% rise in residential property prices, a 5.0% increase in commercial property prices, and a 2.8% rise in agricultural property prices. On a quarterly basis, the property price index rose by 1.6% in the fourth quarter compared to the third quarter, with residential property prices increasing by 1.0%, commercial prices by 2.7%, and agricultural property prices by a significant 9.8%.

In remarks to Asharq Al-Awsat, Khaled Al-Mobid, CEO of Menassat Realty Co., attributed the price surge to heightened demand for housing units and the success of government-subsidized housing projects, which have attracted significant consumer interest. He noted that these factors have boosted property prices, especially in neighborhoods hosting large housing projects such as those in eastern and western Riyadh.

Previously low-priced properties in these suburban areas have experienced sharp price hikes due to increased demand. Al-Mubid believes that if the momentum of housing projects continues in major cities, coupled with strong consumer purchasing power and ongoing growth in the real estate sector, property prices will likely continue to rise through mid-2025, or at the very least, stabilize without declining.

Abdullah Al-Mousa, a real estate expert and marketer, told Asharq Al-Awsat that the sustained rise in property prices is linked to economic and investment growth driven by Saudi Arabia’s Vision 2030 initiatives.

He pointed out that large-scale investments in infrastructure and city development, particularly in major cities like Riyadh and Jeddah, have boosted demand for real estate.

Mega projects such as Qiddiya and developments in entertainment and hospitality have also increased the value of surrounding areas and attracted interest from buyers and investors.

Al-Mousa highlighted that population growth, combined with government initiatives like the “Sakani” program, rising income levels, and stronger purchasing power, have intensified demand for residential properties. Families are increasingly seeking larger spaces and greater privacy, leading to a shift in demand toward villas and spacious apartments.

The evolution of financing mechanisms, including flexible credit facilities and subsidized loan programs, has improved homeownership accessibility. Al-Mousa noted that lower global interest rates have made borrowing more attractive, accelerating purchasing decisions and increasing activity in the real estate market. The expansion of luxury housing projects and developments targeting middle- and high-income families has further driven competitiveness and property price growth.

Real estate marketer Saqr Al-Zahrani noted that Saudi property prices have shown a marked acceleration in the fourth quarter of 2024. He attributed the rise in the general index to the complex interplay of supply and demand dynamics in the market, supported by Saudi Arabia’s recent economic and structural transformations and the influence of foreign investments.