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Tuesday, 24 August 2010

Saudi Shares Falls Most in 2 Months on Growth Risk, Oil Drop; Sabic Slides - Bloomberg

Saudi Arabian shares retreated the most in two months, leading a decline in Persian Gulf markets, after global equities fell on concern the global economic recovery is faltering. Oil declined for a fifth day.

Saudi Basic Industries Corp., the world’s biggest petrochemical maker known as Sabic, dropped to the lowest since July 4. Its Saudi Kayan Petrochemical Co. unit fell 5.7 percent to a 10-month low and Jabal Omar Development Co., a Saudi real- estate developer, slid the most in two months. The Tadawul All Share Index declined 1.5 percent to 6,018.27 at the 3:30 p.m. close in Riyadh, the biggest slump since June 29. The Dubai Financial Market General Index lost 0.5 percent and the Bloomberg GCC 200 Index slid 0.7 percent.

“A stream of negative news from international markets over the past week has pushed buyers to the sidelines,” said Amro Halwani, a trader at Shuaa Capital PSC in Saudi Arabia. “Sentiment on oil is still murky. This is pushing nervous investors to dump petrochemicals.”

Islamic Development Bank Aims to Sell $1 Billion of Sukuk to Fund Projects - Bloomberg

The Islamic Development Bank, a Saudi Arabia-based multilateral lender, plans to sell $1 billion of Islamic bonds to fund development projects in its member countries, Vice President Abdul Aziz Al Hinai said today.

The five-, seven- and 10-year sukuk, part of the IDB’s $3.5 billion Medium-Term Note program, will be issued in the fourth quarter and listed in London and Kuala Lumpur, Al Hinai told reporters in the Malaysian capital after registering a separate ringgit issuance on the local exchange. CIMB Group Holdings Bhd. and four international banks will manage the sale, he said.

Global sales of sukuk will pick up in the second half of the year and rise above the total in 2009, as more companies and governments tap the market, said Badlisyah Abdul Ghani, head of CIMB’s Islamic banking unit. Issuance will climb to as much as $25 billion from about $20 billion last year, he said.

Dubai's Government Has No Current Plan to Seek Credit Rating, Sell Bonds - Bloomberg

Dubai’s government has no “current” plan to seek a credit rating and “no specific plans” to sell bonds, a spokeswoman for the emirate’s Department of Finance said in an e-mailed statement today.

The department “continually assesses its financing options,” the statement said.

UAE stock markets need more liquidity - Daman CEO | Reuters

Stock markets in the United Arab Emirates need additional liquidity from government funds to counter slumping volumes and muted investor activity, the chief executive of Dubai-based Daman Investments said. 'I think there should be a program for creating sustained activity including pension funds and government funds,' Shehab Gargash told reporters on the sidelines of a conference late on Monday.

'If you have the ability to prompt the market, use it because your market is a very easy and quick reflection of the health of the economy.'

UAE markets, which include the two domestic bourses, Dubai Financial Market DFM.DU (DFM) and Abu Dhabi Securities Exchange are the worst-performing among Gulf peers so far this year with lack of institutional participation hurting liquidity."

Sawiris Pushes Vimpelcom Deal as Debt Mounts, Options Dwindle - Bloomberg

Egyptian billionaire Naguib Sawiris, chairman of the Middle East’s biggest mobile-phone operator Orascom Telecom Holding SAE, says nothing drives him more than being told something’s impossible.

“When I go anywhere and someone says ‘impossible,’ I laugh,” he told a gathering of young businessmen in Cairo last month. “In 90 percent of the cases, the impossible happens. A key feature in an entrepreneur is self-confidence. He must believe he’s Superman.”

The 56-year-old is trying to practice what he preaches. Undaunted by his failure to forge a deal with South Africa’s MTN Group Ltd. in June, Sawiris is now in talks to merge his phone business with Russia’s OAO VimpelCom, two people familiar with the matter said on Aug. 20. The transaction would create an entity valued at more than $25 billion.

Aldar's Sukuk Rebounding on Bets for Abu Dhabi Support: Islamic Finance - Bloomberg

Aldar Properties PJSC’s Islamic bonds, the worst-performing debt among Abu Dhabi-linked companies, are rebounding on speculation the government will support the company.

The 5.767 percent convertible Islamic notes due in November 2011 from Abu Dhabi’s biggest real-estate developer rose 1.81 cents on the dollar from a 16-month low reached on Aug. 11, cutting the yield to 9.589 percent from 11.142 percent, according to data compiled by Bloomberg. The securities probably will advance to par, according to Algebra Capital Ltd.

“I think the government will support Aldar,” Mohieddine Kronfol, a managing director at Algebra Capital, the Dubai firm that is 40 percent owned by San Mateo, California-based Franklin Resources Inc. with more than $300 million of assets under management, said in an interview on Aug. 19. The company has “enough money to last for a year-and-half, but beyond that they have to come up with a credible funding plan,” Kronfol said.