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Thursday, 1 April 2010

Abu Dhabi Shares Decline the Most Since December

Abu Dhabi shares dropped the most this year on lower than average volume as investors held back purchases awaiting the release of first-quarter earnings later this month.

Emirates Telecommunications Corp., the United Arab Emirates’ biggest phone company also known as Etisalat, declined the most in more than three months as the shares traded without the right to a dividend. National Bank of Abu Dhabi PJSC, the U.A.E.’s second-largest bank by assets, dropped the most in almost four months. Abu Dhabi’s ADX General Index, which gained 6.8 percent last month, slid 1.7 percent, the most since Dec. 23, to 2,859.57.

“Etisalat is dragging Abu Dhabi down, but otherwise we’re seeing a little bit of profit-taking and an absence of institutional buyers,” said Tarek Zohny, a Dubai-based trader at EFG-Hermes Holding SAE. “Investors are holding back from trading significant volumes until earnings season begins.”

Abu Dhabi Commercial Ends Treasury Joint Venture With Macquarie

Abu Dhabi Commercial Bank PJSC, the United Arab Emirates’ third-biggest bank by assets, said it “concluded” a treasury joint venture with Australia’s Macquarie Bank Ltd.

Abu Dhabi Commercial set up the venture with Macquarie in 2005 to develop trading operations, the bank said in an e-mailed statement. The venture achieved its goals, it said.

The bank said its infrastructure venture with Macquarie remains in place.END

Kuwait's Global wins arbitration, shares rise

Global Investment House, Kuwait's biggest investment bank, received two arbitration rulings in its favour on Thursday, sending shares higher after the bourse lifted a trading halt on the stock.

Global's shares closed 3.6 percent higher. They were halted most of Thursday.

The Kuwait Stock Exchange said in two statements Global won disputes against Al Madina for Finance and Investment Co and Kuwait City Holding Co.

It said the arbitration center at the chamber of commerce and industry ordered Al Madina to pay Global $10.01 million in addition to $300,000 in compensation.END

DFM set to create Islamic benchmark

The Dubai Financial Market (DFM) is planning to launch an Islamic index in the near future, Dr. Mabid Ali Al Jarhi, Secretary General of Fatwa and Sharia supervision board at the DFM, told Gulf News yesterday.

Speaking on the sidelines of a sukuk workshop organised by the Dubai Economic Council, Al Jarhi said: "In the coming three months, DFM will unveil a new index for share trading that complies with Islamic legislations."

He said that DFM has done a lot of research on most of the international benchmarks to come up with a new market index that lists stocks adhering to Sharia.

Qatar to ease ownership law

Qatar is considering an amendment to its investment law that allows up to 100 per cent foreign ownership in certain commercial enterprises, a local daily reported yesterday.

"The Minister of Business and Trade may now issue a resolution to allow the foreign ownership limit to exceed 49 per cent in the sectors of business consulting, technical services, information technology, distribution services and cultural, sports and leisure services," Gulf Times said.

Outside investors have since 2000 been exempt from the 49 per cent capital ownership rule only if they were involved in agriculture, manufacturing, health, tourism, development and exploitation of natural resources, energy or mining.

Alarm raised over Gulf financial job losses

It has been a torrid 12 months for white-collar employment in the Gulf – and for the agencies who act as intermediaries in hiring senior executives.

In February, GulfTalent, a recruitment agency, said that Dubai lost 17 per cent of its professional workforce last year and reported that western foreign nationals had been hit the hardest.

Nakheel, the property developer at the centre of the restructuring proposals for Dubai World, its parent, has gone from employing up to 4,000 people to fewer than 1,000, according to headhunters.

Nasdaq and LSE wait for shifting sands to settle

Ever since the London Stock Exchange rebuffed a hostile takeover by US rival Nasdaq OMX in 2006, the future of the two western bourses has lain in the shifting sands of the Gulf.

This week the emirates of Dubai and Abu Dhabi said they were in talks about a possible merger of their two exchanges. Borse Dubai is the largest shareholder in the LSE, with 20.6 per cent, and has 28.6 per cent of Nasdaq OMX.

The question is, if the financially stronger Abu Dhabi ends up as the key shareholder in both ex-changes, perhaps through an acquisition of the Dubai exchange, how would this re-align the strategic balance between the LSE, Nasdaq and - further south in the Gulf - NYSE Euronext, which last year struck a deal with Qatar to transform Doha Securities Market into an exchange with regional ambitions.

Kuwait KIPCO has enough cash to cover debt-exec

Kuwait Projects Co (KPRO.KW) (KIPCO) has enough cash to cover the firm's debt over the coming three years, the company's vice chairman said in a statement on Wednesday.

"At a group level KIPCO is in a very strong position and has enough cash to cover all its debt due in the next three years," Faisal Al Ayyar said.

KIPCO, Kuwait's largest investment firm, expects to be profitable in 2010, Ayyar added.

Debuts give ETFs a surer foothold in Gulf

They have been much anticipated and discussed but, largely because of market turmoil since the collapse of Lehmann Brothers in 2008, rather less a reality for investors.

In the past week, however, National Bank of Abu Dhabi has initiated the first exchange traded equity fund in the United Arab Emirates, and Falcom Financial Services of Saudi Arabia has launched the first ETF to list on the Saudi exchange, the Arab world’s largest bourse.

Last Thursday NBAD began trading its Dow Jones UAE 25 fund, which is listed on the Abu Dhabi stock exchange. On its first day of trading there were six trades totalling almost Dh328,000 ($89,300), according to the exchange. From a launch price of Dh5, the fund units closed up at Dh5.20 on the first day and were at Dh5.31 on Tuesday.

Dubai International Said to Plan Challenge to Oaktree Takeover

Dubai International Capital LLC the fund owned by Dubai’s ruler, plans to sell bonds for the cash it needs to prevent Oaktree Capital Management LLC from seizing its Almatis unit.

Dubai is planning to repay senior lenders to the German alumina-products maker through a sale of high-yield bonds, two people familiar with the situation said. Two-thirds of senior lenders to Almatis have already voted in favor of Oaktree’s proposal to take over the company in exchange for writing down more than half of its $1 billion of debt.

Dubai is seeking to issue between $600 million and $700 million of senior and subordinated bonds in Almatis, said the people, who declined to be identified because the information is private. The fund is in talks with six banks regarding underwriting assignments, the people said.

ADCB Declines on Debt Restructuring Concern; Dubai Index Falls

Abu Dhabi Commercial Bank PJSC declined for a second day as the United Arab Emirates’ third- biggest lender said it was studying Dubai World’s debt proposal. Dubai’s Index fell as investors await details of the plan.

Abu Dhabi Commercial Bank, which may be owed $1.9 billion by Dubai World, lost the most in almost two weeks. Drake & Scull International PJSC, a Dubai-based construction company, slid the most in three weeks. The Dubai Financial Market General Index retreated 0.4 percent to 1,843.47. The measure gained 2.2 percent for the quarter. Abu Dhabi’s ADX General Index declined 0.6 percent to 2,908.49, the biggest drop since March 18.

“Investors are anxiously awaiting further clarity on Dubai World and eventually the approval of the proposed restructuring plan,” said Ali Taqi, a portfolio manager at A/T Capital Management in Dubai. “Further announcements relating to the proposed restructuring plan, coupled with first-quarter results, will move the market in the short-term.”