Oct 16 2007
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Positive sentiment pushes Gulf indices higher
Market capitalization of the region stood at $873.02 billion (adjusted for cross-listed companies) at the end of the week. Trading activity marginally decreased this week. The region as a whole saw 6.4 billion shares (-3.72 percent) changing hands this week, at a value of $11.83 billion (-5.38 percent).
Market breadth was titled in favor of advancing stocks, with 285 advancers and 132 decliners. NYMEX Crude price was trading at $81.55 per barrel in electronic trading on Thursday afternoon, up by $1.72 for the week.
Jazeera Airways announced this week that it would increase its capital by 100 percent (KD20 million) through shares' subscription which runs from October 21, to November 1, 2007. The company went through huge expansion over the past two years, which led to the increase of fleets of A320 Airbus to 40 planes in June 2007. The capital increase aims at more expansion, including new flights destinations to Northern Africa and the Indian sub-continent. The company was established in June 2004 with a capital of $34 million, 70 percent of which was raised though an IPO.
On the economic front, a recent consultation paper on the UAE issued by International Monetary Fund (IMF) indicated that the UAE's financial system is healthy and has not been affected by the stock market correction in 2005-06. The IMF's observation has come as a big boost of confidence in the banking system and the financial services sector at a time when there has been skepticism about the overall asset quality of local banks in the context of the stock market correction last year, the perceived over-exposure to the real estate sector and the potential losses arising from US subprime related investments in their portfolios.
Kuwaiti stocks continued to break previous records, with the market's benchmark index "Global" General Index reaching a new life-time high of 402.80 points by the end of the week, an increase of 0.92 percent. Market breadth was skewed towards advancing stocks with 73 advancers and 53 decliners.
Volume and value of shares traded on the bourse decreased by 12.87 percent and 7 percent respectively. Sectoral performance was mixed, with five sectoral indices landing in positive territory.
Industrial Index came in the lead, up 2.39 percent. Refrigeration and Warehousing Industries Co. was this week's prominent gainer, up 22.73 percent, to end at KD0.540. Non-Kuwaiti index followed, up 2.03 percent. Share price of Fujairah Cement Industries Co. appreciated by 10.14 percent, at KD0.380. On the other hand, profit-booking dragged the insurance index 1.35 percent lower this week. Al-Ahleia Insurance Company and Warba Insurance Company declined by 3.53 percent and 3.17 percent respectively. Market capitalization of KSE stood at $195.25 billion by the end of the week.
Kuwait Finance House received Malaysian Central Bank approval to go ahead with talks to buy up to 35 branches of RHB Bank. Malaysia's fourth-largest lender. KIPCO Asset Management (KAMCO) raised its stake in Housing Finance Company (ISKAN) to 9.32 percent, from 5.32 percent. Investment firm Zumorroda Investment Holding Company cut its stake in Housing Finance to 16.057 percent, from 16.145 percent.
Gulf Cables & electrical Industries Company received a purchase request from the Ministry of Electricity and Water to supply cables worth KD15.98 million on October 8, 2007. The duration of supply is ten months. The Egyptian Tourism Development Authority canceled its approval for Al-Masaleh Real Estate Company (MREC) of the allocation of 500,000 square meters in Port Said for the establishment of a tourism project and diverted the same to the Egyptian Tower Hotels and Tourism Company. Iraq Holding Company is negotiating with one of the parties for the sale of 20 percent of the capital of Bank Baghdad . The company expects to achieve a profit of KD3mn if the sale was completed.
EGM of Aayan Real Estate Company approved to increase its capital from KD17.995 million to KD32.395 million, an increase of KD14.40 million (80 percent). The new shares will be issued as a par value of 100fils plus 130fils premium per share.
Bahraini stocks ended the week on a higher note, making up for last week's losses. Global Bahraini Stocks Index closed at 199.79 points, up 1 percent for the week. Investment index came in the lead, up 3.84 percent. Arab Banking Corporation and Al Khaleej Development Co ended the week 8.33 percent and 7.86 percent higher. Services index was also a notable gainer, up 2.45 percent. Bahrain Telecommunications Co. ended the week at BD0.998, up 2.67 percent for the week. Volume and value of shares traded in BSE during the week stood at 10.81mn shares (-1.50 percent) and $14.83 million (+24.67 percent) respectively. Buying interest was observed in shares of Seef Properties. Investors exchanged 1.9mn of the bank's shares. Seef's shares appreciated by 4.17 percent, to reach BD0.150. Market capitalization of BSE stood at $27.17 billion by the end of the week.
DSM stocks continued to build up momentum, with Global Qatari General Index adding 1.45 percent in weekly gains to close at 606.71 points. All the four sector indices ended the week on a positive note. Market breadth was tilted in favor of advancers this week, with 30 advancers and 7 decliners. Global Insurance Index registered the highest gain of 2.62 percent, as all five insurance stocks ended the week on a positive note. Banking & Financial index was also a notable gainer, up 2.17 percent. Al-Rayan Bank appreciated by 10.29 percent, to end at QR19.30. Qatar National Bank and Al Khaliji Commercial Bank ended the week 2.79 percent and 2.73 percent higher respectively. Qatar German for Medical Devices continued its positive performance, topping this week's gainers list, up 39.15 percent, at QR26.30. Meanwhile, Mannai Corporation recorded the steepest decline of 7.53 percent, to close at QR117.90. Volume and value of shares traded in DSM dropped by 7.88 percent and 27.92 percent respectively. Market capitalization of the Qatari market reached $83.96 billion by the end of the week.
The Council of Ministers granted Al Rayan Bank to raise the ownership limit for non-Qataris from 31 percent to 49 percent. This will be implemented after the EGM's approval. BOD of Qatar General Insurance and Reinsurance Company approved the appointment of a management committee to conduct a feasibility study for the establishment of a 100 percent owned holding company. Gulf Warehousing Company was granted the official approval for a QR500mn loan that will be used for the financing of the first phase of the Logistic Village project DSM market committee has given preliminary approval to list A'amal Holding Co and Qatar & Oman Investment Co on the bourse. The decision requires the endorsement of Qatar Financial Markets Authority.
Saudi stocks recovered this week, with Tadawul All Share Index ending at 7,912.45 points, up 1.90 percent for the week. The market reflected 3Q results either announced already or expected shortly. All sectors of the market ended the week on a positive note, except insurance and banking sectors indices, that edged down 4.07 percent and 1.69 percent respectively. Meanwhile, Industrial index managed to gain 5.34 percent this week, fueled by buying interest in heavy-weight Saudi Basic Industries Corp. (SABIC). Investors exchanged 9.6mn of Sabic's shares, driving the scrip 5.88 percent higher by the end of the week, to end at SR135. Telecom index was also a notable gainer, up 1.78 percent. Share price of Ettihad Etisalat (Mobily) and Saudi Telecom Co appreciated by 2.62 percent and 1.56 percent respectively. Volume and value of shares traded in Saudi market dropped by 13.54 percent and 9.23 percent respectively. Market capitalization stood at $357.52 billion by the end of the week. Meanwhile, decliners outpaced advancers by 60 to 36.
Capital Market Authority approved Arabian Cement Company's request to distribute 10mn bonus shares (9 percent) to its shareholders who are registered in the records on the date of the next EGM, which will be set at later stage. CMA also approved the company's request to increase its capital from SR600 million to SR1.1 billion through a SR500 million rights issue. The price and number of shares issued will be announced at a later stage.
Saudi Electricity Company is planning to develop two power plants to be built in Saudi Arabia which will add more than 3000 megawatts to the country's power grids. Saudi Hollandi Bank was appointed lead manager and financial advisor for the IPO of Middle East Specialized Cables company that is planning to offer 30 percent of its capital in November 2007.
Saudi Printing and Packaging Company was awarded a SR6.2mn contract by the Ministry of Islamic Affairs to print holy books to be delivered in 2 months after the signing of the deal.
Al Sagr National Insurance Company 's subsidiary, Al-Sagr Saudi Insurance Company , was granted a license from the Saudi authorities' and an approval from the Capital Market Authority to launch an IPO offering 42 percent of its SR200 million capital (8.4 million shares) starting October 27, 2007.
UAE markets continued to surge for the third consecutive week, with NBAD Index reaching its highest level since 10/07/2007. The index added 2.71 percent in weekly gains, to reach 11,565.89 points. Market breadth was skewed towards advancers, with 63 advancers and only 13 decliners. All sectoral indices ended the week in positive territory, except insurance index that marginally declined by 0.03 percent. Services stocks came in the lead, with the sector's index growing by 3.33 percent this week.
National Hotels Company topped this week's gainers list, up 17.61 percent, to end at AED7.48. Oasis International Leasing followed, up 17.39 percent, at AED2.16. Meanwhile, Kuwait-based Agility reported the steepest decline this week, shedding 14.5 percent to close at AED17.10. Trading week was shortened to four sessions only due to Eid Al-Fitr holiday. Nonetheless, volume and value of shares traded in UAE increased by 1.05 percent and 8.29 percent respectively. Market capitalization of the UAE markets ended the week at $180.76 billion.
Dana Gas sold $875 million of its convertible sukuk issuance. The new sukuk have fixed profit rate of 7.5 percent. The reference share price, to which an exchange premium of 10 percent will apply, will be set within a period of 9 months.
Amlak Finance denied media reports and announced that it is not undertaking negotiations to merge or acquire Dubai Bank. Dubai Islamic Bank was awarded the UAE's Best Real Estate Investment Management Bank by the Liquid Real Estate magazine.
National Central Cooling Company signed three contracts for a period of 20 years, to provide cooling services for a total of 7,600 tons of refrigeration in Dubai and Abu Dhabi. BOD of Gulf Pharmaceutical Industries approved entering a joint venture with a 40 percent stake to establish a new company specialized in pharmacies' management.
Arkan Building Materials Company signed a MOU with M-Tec (Germany) in which the latter will supply machines for a value of EUR4.9mn for the establishment of a new Dry Mix Mortar plant that will be constructed in Arkan Industrial Park at Al Ain.
MSM continued to soar to new levels, with MSM General Index reaching a new record-high of 7,476.18 points, up 2.60 percent for the week. Omantel continued to be the buzz of the market for the second consecutive week. Buying interest was clearly witnessed on Omantle's shares, with 12.86mn shares exchanged, aggregating to $50.55 million. The scrip soared by 9.51 percent for the week, reaching OR1.543. Consequently, Services Index grew by 3.79 percent this week. MSM cancelled trades executed on Global Financial Investments on October 11 and 12, sighting disclosure issues. Global Financial Investment sold 10 percent of its shares in Oman Hotels & Tourism Co. The scrip ended the week 0.58 percent higher, at OR0.174 Volume and value of shares traded in MSM increased by 23.88 percent and 77.71 percent respectively. Out of the 70 stocks traded in MSM during the week, 45 were advancers and only 15 were decliners. Market capitalization of the MSM stood at $17.27 billion by the end of the week.
Renaissance Services company's subsidiary, Adyard Abu Dhabi , was awarded a $35 million contract by Single Buoy Moorings (Switzerland) to develop a mobile offshore production unit for Talisman Energy. The project will be completed over a period of 18 months.
A new board for Oman Telecommunications Co has been appointed. The new board will be chaired by H.E Eng. Sultan bin Hamdoon Al Harthy - Undersecretary of Ministry of Heritage and Culture for Heritage. The company will call for EGM after Eid Al Fitr holiday to amend article (22) of the company's article of association increasing the number of board members to nine. The international expert's name will be disclosed upon appointment by the concerned authorities. In regards to the statement issued by Minister of Commerce & Industry that Oman Flour Mills Company will not increase the selling prices of flour for the remaining part of this year, and that the government has intervened in providing wheat from Iran, Salalah Mills Company emphasized that the company has not been consulted in regards to no-price increase decision and no quantity out of the 160,000 tons of Iranian wheat has been allocated to company. The impact of OFM's decision on the company's financial position and the fourth quarter result will be discussed by the company's BOD in the next meeting.
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