Happy morning, Munchers! 🙏

Hope you had a great Monday. For those of you guys that are still in school, welcome back. Let's hope this year's the best one yet. ;)

As always, here is your daily dose of the news that matters, from Wall Street to Dalal Street - in 5 minutes and 12 seconds.

Let’s dive in.

What’s hot, what’s not?

Market Commentary

• India markets slid about 1.5% after the US Fed's comments on policy.

• America traded flat - not much news to go off, so action was pretty muted.

• European electricity prices slid 23% as gas storage hit capacity in Germany, getting rid of recession fears.

Story Roundup

1 - Pakistan secures a $1.17bn bailout bag from the IMF. 🤝

The IMF board just approved a $1.17 billion bailout to be paid to Pakistan.

This money is going to be key in stabilizing their economy - in July their bonds traded at almost 40% yield in USD terms, essentially pricing a default in.

Since then, their stock markets have recovered to be the best performers in Asia.

Pakistan needs to service $3bn of debt by June 2023 - which includes a $1.7bn payment due in December.

Their FX reserves currently stand at $7.8bn - enough to cover 2 months of imports.

Comeback king?

Maybe with their economy, but definitely not with their cricket. ;)

2 - Ambani wants to take it to China in green tech race. 🍏

Asia's second richest man Mukesh Ambani said that India is "a credible alternative" to China when it comes to green energy production.

His company Reliance is India's largest listed company - and invested about $10bn into renewables last year. 

Reliance's profitability is still driven by fossil fuels - which means pivot is necessary.  

This new obsession with renewables led to him building 5 new factories to produce photovoltaic panels - the things you see in solar panels.

Electrifying business. 💡

3 - Euro claws back to parity after ECB hints at 75bp hike. 🗻

Recession risks loom, but policymakers want to tighten the European economy up.

A growing number of ECB ministers want to opt for an aggressive 75 basis point interest rate hike - a big step up from the bank's 50bp hike in July.

Inflation across the Eurozone is set to cross into the double digits - wreaking havoc on customers, businesses and governments alike. Those grocery bills are getting heavier. 

So far, it looks like the market is pricing in a 50% chance of this 75bp hike going through.

Unprecedented times. 🔥

4 -  Honda and LG team up to build a $4.4bn battery plant. 🔋

Asian giants Honda and LG are joining forces to build a battery factory in the US.

Normally, any company investing this much cash into a plant would go to China. Not this time, though.

There's been increased pressure from America to cut China out of EV supply chains - evident in this year's price rally. Your Tesla's damn expensive. 

It will also be Honda's first move in the EV sector - right after they promised zero fossil fuel use by 2040.

5 - EU wants to rip up the energy market. ⚡

Europe is fed up with high prices.

Electricity prices are 10x their normal levels, and gas prices are 14x.

These surges are "exposing the limitations of the current market" - and the EU wants to shake it up a little. 

The European Commission is supposedly also working on an emergency intervention - which will structurally reform the energy markets.

Shell's CEO warned that the energy crisis will last for over a year - and that electricity could almost go up to 1,000 Euro/MWh - a record high.

Shocking. ☀️

Hope you enjoyed this issue of the Market Munch. If you have any feedback, positive or negative, hit my line at [email protected] or +971 50 708 8469. 

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Cheers. 

- A