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00:00Over the last couple of years all of the conversations we've had on the set make the point that equity markets in the region have priced in geopolitics and are resilient to geopolitics. But that's not what we're seeing right now. Well not only our region actually all emerging markets were sold off as well . Right. So we have to take that into account. Actually the news is to me not too surprising Rosy. That was not priced in by the market. We see the sell off an equity risk premium coming back in quite interesting to see that Marcus has done well . Obviously correct but even the event it hasn't done well started to drift lower. So that was not really protecting the event from lower levels. We had earnings from Arab tech out just moments ago Emaar Properties hit hard. Yeah. Is that is the concern around an impact on property in particular off the back of these geopolitics justified. Do you think. Not really. If we look at EMR without new developments we see a bare bones elevation of eight and a half during my share which gives you substantial upside. So we can't really warrant the current valuations. Is that relevant at the moment investors don't really care about valuations at this juncture if they've allocated money to Saudi in anticipation of obviously the Footsie inclusion and hopefully the MSCI inclusion. We think it's not a done deal. We gave it a 60 percent chance not more than that. That could be actually the trigger for regional money to come back to the UAE particularly if you are an institutional investor that is dedicated to Mena really. Egypt is very interesting but it's a small market. So we think if MSCI upgrade doesn't happen people would rotate out of salary into the UAE for example. We've put together a chart that shows what's been happening with the relative strength index. I mean a lot of these indexes were overbought now with the recent sell off that is all corrected. GDP go our clients can pull it up we've added to by Egypt and Saudi Arabia and they've all gone below 50 now for the case of Dubai with an RSI of 25. What is what are some of your top traits dramatically as earnings season begins to well draw to a close. Yeah we're heavily overweight on Egypt. Our weight is about 20 percent for it and the benchmark weight is only 4 percent. So relatively we're very strongly overweight particularly playing the consumer names industrial names that are out there. The P and L repair is going to be very substantial. We are pretty heavy on Saudi but underweight. Actually it's very hard to get to 58 percent weighting if you look at the MSCI for the Mena it's very tough to get there but it's still quite interesting things that earnings were bit lives outside the financial sector. I don't think the results will be that supportive. Banks have been resilience Matt. Earnings growth was about 7 percent we don't really play that theme too much but the themes we play in the financial sector is rising rates and that's actually and that's about Shery Ahn coming through that's gaining traction. Brent it's been an incredible story for anybody who's long on commodities you're looking now at Coles for the likes of Goldman Sachs are seeing Brent is going to top their target of 80 to spot fifty dollars a barrel in the next couple of months. I mean that I mean what's your call on oil right now. If you have one and that's that's probably changed in line with all the other forecasts. Yeah I know there's just one upside risk for oil in the short term long term is a bit more questionable in the short term I think definitely it is moving up. Quick question is how much of the Iranian exports are going to be affected by the sanctions by the U.S. starting August 6. We don't think too much but obviously this uncertainty is pushing the share let's say the oil price higher at the moment which in essence is free. It actually is positive for government spending. You saw the Saudi budget let's say Saudi budget numbers for the first quarter spending is up almost 18 percent. And we start to see incremental fiscal spending in the region helping the economy is going forward. So does this mitigate add to the uncertainty that we also see no .

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Arqaam Capital's Meijer Is Heavily Overweight Egypt

Jaap Meijer, managing director and head of research at Arqaam Capital, discusses his investment strategies for the Middle East. He speaks on "Bloomberg Daybreak: Middle East." (Source: Bloomberg)

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