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Tuesday, 5 April 2011

MENA stock markets close - April 5, 2011

ExchangeStatus IndexChange
TASI (Saudi Stock Market)
DFM (Dubai Financial Market)
ADX (Abudhabi Securities Exchange)
KSE (Kuwait Stock Exchange)
BSE (Bahrain Stock Exchange)
MSM (Muscat Securities Market)
QE (Qatar Exchange)
LSE (Beirut Stock Exchange)
EGX 30 (Egypt Exchange)
ASE (Amman Stock Exchange)
TUNINDEX (Tunisia Stock Exchange)
CB (Casablanca Stock Exchange)
PSE (Palestine Securities Exchange)

$200-300 oil if unrest spreads to Saudi Arabia says Sheikh Yamani « ArabianMoney

Former Saudi oil minister from the 1970s, Sheikh Ahmed Zaki Yamani told Reuters that oil prices would explode to $200 to $300 a barrel if regional unrest spreads to Saudi Arabia.

‘If something happens in Saudi Arabia it will go to $200 to $300,’ he said. ‘I don’t expect this for the time being, but who would have expected Tunisia?’

The comment by the one-time controller of the world’s major oil supplier is bound to send a shiver up the spine of consumers now facing the highest petrol prices ever. But doubtless stock markets will ignore it as they have spiralling energy costs across the world.

TUI says in talks over Hapag stake sale | Reuters

Germany's TUI said it was in talks to sell a stake in container shipping business Hapag-Lloyd that it had earlier said it wanted to float, boosting its shares by 5 percent.

The German travel operator was in early stage talks with several interested parties including Oman and HNA -- China's fourth-largest airline group -- about the sale of a stake in Hapag-Lloyd, sources close to TUI said.

Its stock traded 5 percent higher at 8.96 euros at 1029 GMT (6:29 a.m. ET), against a flat midcap index in Germany.

Kuwait sets $90bn 5-year oil investment budget -

State-run Kuwait Petroleum Corp (KPC) will invest approximately $90bn over the next five years in its oil and gas businesses and growth strategy, a company offical said on Tuesday.

Hashin Al Rifai, KPC's planning manager, told reporters the investments were part of a longer-term programme that envisions $340bn in spending to 2030.

"On the oil sector capital programme, we are well on track and poised to spend around $90bn in the coming five years...that is going to mushroom to $340bn over the 2030 plan period," he said.

ANALYSIS-Oil, state spending to boost Gulf despite unrest By Reuters

Political unrest in the Gulf threatens private sector spending and investment but thanks to high oil prices, governments have enough financial firepower to prevent their economies from slowing sharply.

Protests, some of them violent, have touched almost every country in the Gulf over the past two months. Except for Bahrain, the direct economic impact in terms of lost output has been tiny. But the protests have highlighted the potential for more trouble if political issues are not resolved, and this is dampening the mood in the private sector.

However, high global oil prices -- themselves partly due to unrest in the Gulf and North Africa -- are boosting energy sectors in the region and giving governments enough cash to spend their way out of trouble.

Ras al Khaimah rated 'A', stable outlook by Fitch | Alrroya

Fitch Ratings has affirmed the Emirate of Ras al Khaimah's (Rak) Long-term foreign and local currency Issuer Default Ratings (IDR) at 'A' with Stable Outlooks. The Short-term foreign currency IDR is affirmed at 'F1'. The Country Ceiling is 'AA+' (equal to the UAE Country Ceiling).

"Ras al Khaimah has significantly bolstered its creditworthiness over the past year," says Richard Fox, Head of Middle East and Africa Sovereign Ratings at Fitch. "The budget has moved back into surplus, debt has begun to decline and the debt maturity profile has benefited from proactive debt refinancing."

Fitch judges Rak's public finances to be a key strength of its credit profile. Figures are on a public sector-wide basis, including all major state-owned enterprises (SOEs). Budget and balance sheet data are now available quarterly, marking a significant improvement in data provision over the past year. In 2009, Rak was adversely affected by the global financial crisis, particularly via its impact on Dubai - an important market.

U.A.E. Shares Fall, Led by Dubai, on Concern Gains Overdone - Bloomberg

United Arab Emirates shares fell, sending Dubai’s benchmark index to an almost two-week low, on speculation recent gains are overdone and as oil declined for the first time in four days. Qatar’s measure advanced.

Emaar Properties PJSC (EMAAR), builder of the world’s tallest sky scraper, retreated for a third day and Dubai Islamic Bank PJSC (DIB), the biggest Shariah-compliant lender in the U.A.E., decreased the most in three weeks. Dubai’s DFM General Index (DFMGI) slipped 0.7 percent to 1,537.68, the lowest level since March 23, at the 2 p.m. close in the emirate. The measure soared 10 percent in March. Abu Dhabi’s ADX General Index (ADSMI) fell 0.4 percent, paring the gain in the past month to 2.4 percent.

“There was a strong rally during the last few weeks and as we’re seeing nothing major in news flow we have some profit taking today,” said Sebastien Henin, who helps oversee $110 million at The National Investor in Abu Dhabi. “Investors don’t want to position themselves in the current market just yet. We will probably see some more profit taking in the coming days.”

Q1 Progress Report « Alpha Dinar- talking Gulf finance

The first quarter of 2011 was filled with surprises, both economically and politically speaking. Q1 was the time of unrest in the MENA region, as frustrated citizens demonstrated (and some overthrew) their leaders, ushering in a new era in the region. Economically, markets reacted negatively to the news, and the markets were very volatile. The commodities market reacted as well shooting oil prices from the mid-$80’s range to close to $120.

In terms of equity performances, suprisingly the Saudi market was the best performer (shedding 0.9%) while the Kuwaiti market was the worst performer (declining 9.5%). Kuwait, along with Qatar and the UAE, are rated among the safest countries in the MENA region, with the least threat of any public greavance. Saudi Arabia, on the other hand, was very vulnerable to the riot virus. The Saudi market did, however, witness a lot of volatility. After news broke out of protests on Bahrain, the Saudi market shed more than 15% in just three days, only to recover these losses in the following week. Oil prices appreciating helped, as well as the extra spending intiated by King Abdulla. Kuwait’s decline may be attributed in part to the cancelation of the Zain-Etisalt deal, which would have increased the liquidity of the market.

Dubai default risk back to pre-crisis level - Emirates 24/7

The cost of insuring five-year Dubai debt against default plunged to its pre-crisis levels this morning with the emirate’s economic engine roaring back to life in the first quarter of the year.

Dubai’s five-year credit default swaps (CDS) have continued to recover on positive economic and financial investment sentiment, and have dropped to about 380 basis points this morning according to CMA DataVision’s Sovereign Risk Monitor.

The CDS are now hovering around the same levels where they were in November 2009, before the Dubai government announced a standstill on debt held by Dubai World.

Fitch assigns Majid Al Futtaim Holding 'BBB' rating | Alrroya

Fitch Ratings has assigned Majid Al Futtaim Holding LLC (MAF) a Long-term Issuer Default Rating (IDR) of 'BBB', with a stable outlook, and a short-term IDR of 'F3'.

The ratings reflect MAF's status - through the property arm of the group, Majid Al Futtaim Group Properties LLC (MAFP) - as one of the largest property investment companies in the Middle East and North Africa region (Mena). The consolidated group has a total retail area of 937,214sq m and MAFP had net fixed assets valued at Dh27.2bn as at FYE2010. MAFP's centres are prime sites due to their strategic locations in major cities, up-to-date leisure and entertainment facilities and the availability of large parking lots. MAF is also involved in the development of wholly-owned hotels in close proximity to MAFP's shopping mall assets.

"MAFP's operational performance in 2009 and 2010 was resilient, with the occupancy rate remaining at 99 per cent," says Bashar al Natoor, Director in Fitch's Corporates team in Dubai. "MAFP benefits from an average lease length of seven to eight years, which compares well with European peers, a good quality and diversified tenant base exhibiting an estimated 88 per cent lease renewal rate, and a low tenant default rate."

Bahrain’s new normal: looking bleak | beyondbrics –

The restoration of calm in central Manama, which last month was a battleground between police and protesters, has allowed a sense of normality to return to the capital – even if stability is characterised by armoured personnel carriers parked outside five-star hotels.

The Saudi-backed security grip has not let up in Bahrain’s restive Shia villages since the police violently cleared Pearl roundabout, where protesters largely from the majority Shia community demanded change in a country dominated by minority Sunnis.

But shopping malls, once empty and forced into offering cut-price bargains, are now getting busier again.

Indian tycoon Ambani questioned in telecom scam - Maktoob News

Indian billionaire Anil Ambani was called before a powerful parliamentary committee on Tuesday for what promised to be an uncomfortable hearing into a multi-billion-dollar telecom fraud.

Ambani, who heads Reliance ADA, was set to give "oral evidence" before the 13-member Public Accounts Committee (PAC) over the allegedly fraudulent distribution of licences in 2008 to top telecom firms at throwaway prices.

His company, Reliance Telecom, a unit of Reliance Communications, has been charged by police in the case and Ambani was expected to be questioned about this. Three Reliance executives are also to stand trial.

Qatar cuts interest rates by at least 50 bps | Reuters

Qatar's central bank on Tuesday slashed key interest rates by at least 50 basis points for the first time since August, its website showed.

The move brought the main overnight deposit rate to 1.0 percent, from 1.5 percent, the website showed, confirming earlier reports by three banking sources.

The overnight lending facility and the repo rate were also both reduced to 5.0 percent from the original 5.5 percent and 5.55 percent, respectively.

The central bank did not explain reasons for the rate reductions.

MENA stock markets midday GMT+4 - April 5, 2011

ExchangeStatus IndexChange
TASI (Saudi Stock Market)
DFM (Dubai Financial Market)
ADX (Abudhabi Securities Exchange)
KSE (Kuwait Stock Exchange)
BSE (Bahrain Stock Exchange)
MSM (Muscat Securities Market)
QE (Qatar Exchange)
LSE (Beirut Stock Exchange)
EGX 30 (Egypt Exchange)
ASE (Amman Stock Exchange)
TUNINDEX (Tunisia Stock Exchange)
CB (Casablanca Stock Exchange)
PSE (Palestine Securities Exchange)

Oil at $120: EMs hit hardest | beyondbrics –

Oil prices slipped slightly in Asian trading on Tuesday but remain well above $120 a barrel for Brent crude, as investors fret about Libya, unrest in North Africa, andNigerian election delays, not to mention delivery problems in the North Sea and a strike in Gabon.
At 0810 London time, Brent crude was at $120.67, down $0.39, but still close to its highest level since 2008. The premium over West Texas Intermediate - the US benchmark – widened to $12.80 – short of its March record of $17 but still high by past standards, in recognition of the greater threats to supply in Europe than North America.
For emerging economies, high prices are clearly bad for the oil importers. But they are also bad for the oil exporters if they stay high for any length of time, given the threat they represent to economic growth and to efforts (in some countries, including India and China) to control inflation.

Damas brothers owe Dh1.8bn to banks and company - The National

The brothers behind Damas International, the Middle East's biggest jeweller, owe a previously undisclosed Dh1.2 billion (US$326.7 million) to banks, it has emerged.

The disclosure comes as the company's restructuring appproaches its climax.

The debt, owed to more than 20 banks, comes in addition to Dh600m drawn from Damas International, according to a company spokesman.

Dubai Yield Gap to Malaysia Shrinks as Debt Restructured: Islamic Finance - Bloomberg

Dubai’s borrowing costs relative to Malaysia’s sank to a record as the emirate makes progress restructuring debts.

The extra yield investors demand to own Dubai’s 6.396 percent dollar bond rather than Malaysia’s 3.928 percent sukuk dropped to 251 basis points yesterday, the lowest ever, according to data compiled by Bloomberg. The gap has narrowed 66 basis points since state-owned Dubai World signed an accord with creditors to alter terms on about $25 billion of debt on March 23. Dubai also benefited from a 64 percent jump in flows to higher-yielding bonds in the first quarter, according to data from Cambridge, Massachusetts-based research firm EPFR Global.

“Investors are finding Dubai’s sukuk attractive because of the relatively higher yields, and the low risk associated with the emirate’s public debt,” Aziz Oujdi, an Abu Dhabi-based portfolio manager at Al Hilal Bank, a Shariah-compliant lender owned by the Abu Dhabi Investment Council, said by phone April 3. “The Dubai World debt deal has helped restore confidence in Dubai’s ability to repay its debts.”

Egypt’s Foreign Reserves Fall to Lowest Level Since 2007 After Uprising - Bloomberg

Egypt’s net international reserves fell for a third month in March to the lowest level in more than three years as the economy suffers from the unrest that toppled President Hosni Mubarak.

Reserves fell to $30.1 billion, the lowest since September 2007, from $33.3 billion in the previous month, according to provisional data on the central bank’s website.

Mubarak resigned on Feb. 11, bowing to mass protests that demanded the end of his rule. The country’s worst political crisis in three decades caused tourists to flee and companies to cut output. Concern over a possible run on the currency prompted the central bank to buy pounds Feb. 8, though the bank hasn’t said whether it repeated the action since then.

Investment in Qatar Forum opens in New York tomorrow

The Business and Investment in Qatar Forum will be held tomorrow in New York under the patronage and in the presence of the Prime Minister and Foreign Minister H E Sheikh Hamad bin Jassem bin Jabor Al Thani and high-level officials from Qatar and the US.

With around 1,000 participants representing various business sectors, the forum will be held at the historic Waldorf Hotel located in midtown New York.

On the sideline of the Forum, the formal inauguration ceremony of Qatari-US joint project of the Golden Pass LNG terminal will be done by the Prime Minister and Foreign Minister in the presence of Minister of Energy and Industry H E Dr Mohammed bin Saleh Al Sada, during a dinner reception.

Oman fund takes 15 pct Hapag-Lloyd stake-source | Reuters

Oman's state-owned Onyx Investments Ltd has taken a 15 pct stake in German container shipping company Hapag-Lloyd [HPLG.UL], an official at the parent company of Onyx said on Monday.

"Onyx Investments has bought a 15 percent stake in Hapag-Lloyd," the official at Oman Investment Fund told Reuters.

The official declined to be named and did not give a value for the deal.

Kuwait wants foreign firms back - The National

Kuwait is hoping to lure foreign petroleum companies back to its oil sector after years of restricting their involvement to limited contract work.

The emirate aims to boost its production capacity to 4 million barrels per day (bpd) by 2020 from an estimated 3.4 million bpd at present, including output from the "divided zone" it shares with Saudi Arabia, said Farouk al Zanki, the chief executive and deputy chairman of state-owned Kuwait Petroleum Corporation (KPC).

To achieve that, the company will need to develop partnerships with international oil companies (IOCs) to ease technology transfer, Mr al Zanki acknowledged. - Dubai offered a short-term shot in the arm

As a liberal outpost in a tough region, Dubai has historically prospered from its neighbours’ misfortunes.

At the turn of the 20th century, the emirate drew in heavily taxed Persian traders; in the 1980s, the Iran-Iraq war turned the city’s port into a haven for tankers and ship repair; and, in the aftermath of the 2001 September 11 attacks, money flows to the Gulf found a welcome home in a booming property sector.

Now, as opposition movements challenge dictators around the Arab world, another wave of instability is providing Dubai with a period of opportunity. / Columnists / Gideon Rachman - It’s 1989, but we are the Russians


For the western world, the “Arab spring” threatens to be a classic case of good news and bad news. The good news is that this is the Arab 1989. The bad news is that we are the Soviet Union.

An exaggeration? Certainly. But there is enough truth in the analogy to explain why both the US and the European Union are uneasy about revolutions that – on one level – promote core western values, such as democracy and individual rights.

Much of the corrupt and autocratic order that is wobbling so badly in the Middle East was western-backed. The sponsorship was nowhere near as brutal or as overt as the Soviet repression of eastern Europe. And there have always been anti-western regimes, such as Iran and Syria, existing alongside the pro-western governments in the Middle East.