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Sunday, 8 February 2009

Global's GCC Islamic Index –Weekly Brief dated February 05, 2009

"Following the successful launch of Global GCC Islamic Index; and in line with the growing interest in Islamic finance, Global Investment House is proud to present a “GCC Islamic Index –Weekly Brief”.

The report examines the performance of GCC Shariah compliant companies (components of the index), highlighting industry as well as individual stock performances. It also entails economic and company developments, in an effort to keep investors cognizant of local and regional issues related to Islamic finance.

In order to view the full report for the week, kindly click on the link above:

"GCC Islamic Index – Weekly Brief""

Global's GCC Weekly Market Report – February 05, 2009

"Global has published its new ‘GCC Weekly Market Report’. The report examines the performance of various key sectors and companies within the six GCC countries, highlighting industry as well as individual stock performances. It also entails economic and company developments, in an effort to keep investors cognizant of local and regional issues.

In order to view the full GCC research for the week, kindly click on the link above:

"Weekly GCC Market Report"

Lewis Charles unveils Abu Dhabi fund

Lewis Charles Securities Limited, the London-based investment house, yesterday launched $100 million (Dh367m) three-year closed-ended fund focused on Abu Dhabi real estate sector.

The Lewis Charles Abu Dhabi Property Fund will take advantage of the opportunities in Abu Dhabi presented by a chronic undersupply of housing and the population boom. The fund will be seeking to raise $100m from investors with a minimum investment requirement of $75,000 for individuals and $250,000 for institutions. The target IRR is over 25 per cent per annum.

The fund's Investment Manager – Lewis Charles Securities Limited is authorised and regulated by the Financial Services Authority (FSA) in the UK and has over $132m in assets under management.

Gulf SWFs 'must target credible financial assets'

Gulf-based sovereign wealth funds, intending to invest in the US and European assets, should direct their investments to credible financial assets, said a senior bank official.

Steen Jakobsen, the Chief Investment Officer (CIO) of Saxo Bank, has said: "I do not mean to say that the GCC countries should be buying companies like Merrill Lynch. When we take the debt writedowns aside, whatever is left has a unique investment opportunity," he said.

Jakobsen went ahead to term an aid to bailout the West as a "responsibility" of the GCC countries.

Middle East wakes up to exchange traded funds

There is a growing awareness for Exchange Traded Funds (ETFs) in the Middle East and the region's exchanges are waking up to the idea of launching them here, a top official of Barclays Global Investors said.

"Many of the exchanges in the GCC have talked about introducing an ETF. I have moved around the region and have discussed the issue. Some of the investors here, including the private banks, are telling us that the only products they are using now are ETFs," says Deborah Fuhr, Managing Director and global head of implementation strategy with Barclays Global Investors (BGI).

However, the region does not have an ETF now. And investors wanting to trade in it need to register in foreign waters. Fuhr said that countries need to put in essential regulations in place in their stock markets and establish essential benchmarks prior to launching ETFs.

Tanker serves as oil stockpile

In the latest sign that energy producers are still pumping too much oil, Koch Supply and Trading, the US oil firm, has booked a supertanker for six months to store about 2 billion barrels of crude off the east coast of the Emirates.

The move to stockpile oil at sea near Fujairah, a Middle East fuel bunkering hub, is part of a worldwide trend towards offshore storage that has developed because onshore oil depots are full, and most oil traders expect prices to rise in coming months, analysts said.

But it also means global oil demand is falling faster than producing countries, primarily those within OPEC, are cutting output.

The devil is in the detail in Gulf credit defaults

The news that Kuwait’s Global Investment House defaulted on most of its US$3 billion (Dh11bn) in loans sent shock waves through the Gulf, raising fears that others could follow suit. To compound the uncertainty, Moody’s, the credit ratings agency, last month issued its first negative outlook for banks in the Emirates since it began reviewing them a decade ago.

However, from the financial crisis, the Gulf could come out stronger if a more rigorous internal analysis of credit extension and supervision is pursued. The name of the game is transparency and yet more transparency if both regional and international confidence in the financial system is to be restored.

The decision by Moody’s to issue its first negative outlook was prompted by the perceived lack of transparency in the way the nation’s property developers conduct their business, and in turn by the manner in which loans have been extended to this sector by regional banks.

Gulf progresses on bailouts

As US politicians prepare to vote on their economic stimulus package – expected to be about US$780 billion (Dh2.84 trillion) – governments in the Gulf are working on similar measures to breathe life into ailing economies.

Abu Dhabi last week announced a Dh16bn injection of fresh capital into five of the emirate’s banks, a move aimed at shoring up balance sheets and sustaining lending as the global slowdown bites.

And Kuwait’s parliament is soon to consider a broad rescue package that would help its troubled investment firms. The intent, according to a statement from the nation’s Cabinet, is to “safeguard the financial system and stabilise the domestic economy against the fallout of the global economic crisis”. Earlier reports said at least 4bn Kuwaiti dinars (Dh49.79bn) would be used to guarantee existing loans and trigger new lending.