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Thursday, 21 April 2011

MENA stock markets close - April 21, 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)

Dubai Stocks Complete Longest Rally Since 2005 on Economy, Oil; DFM Gains - Bloomberg

Dubai shares rose a tenth day, the longest rally in six years, as investors turned to assets in the politically stable emirate on signs the economy is recovering and after oil advanced.

Emirates NBD PJSC (EMIRATES), the United Arab Emirates’ biggest bank by assets, surged to the highest since December 2009. Dubai Financial Market (DFM) PJSC rose 0.7 percent. The DFM General Index (DFMGI) climbed 0.1 percent to 1,681.93, the highest since Dec. 9, at the 2 p.m. close in Dubai. The measure completed its longest winning streak since April 2005. The gauge, which rose 3.7 percent this week, has surged 24 percent from a low on March 3, surpassing the 20 percent threshold some consider the beginning of a bull market.

Shares are up on the “positive economic environment in the U.A.E. We’re seeing trade and tourism in particular soar and sentiment is good,” said Mahdi Mattar, head of research at Abu Dhabi-based CAPM Investment PJSC. “Internationals are looking at the MSCI inclusion, but more important, local investors are back” after exiting the market amid uprisings that spread in the Middle East. Higher oil has helped gains, he said.

Fitch affirms TDIC’s AA ratings; outlook stable - Emirates 24/7

Fitch Ratings has affirmed Abu Dhabi-based Tourism Development & Investment Company’s (TDIC) long-term issuer default rating (IDR) and senior unsecured rating at AA and short-term IDR at F1+, the agency said in a statement, adding that the outlook for the long-term IDR is stable.

The affirmation also affects both TDIC Finance’s global medium-term note programme with $1 billion of outstanding notes and TDIC Sukuk’s Sukuk programme with $1bn of outstanding trust certificates.

Fitch applied its parent and subsidiary rating linkage methodology in rating TDIC, concluding that a strong relationship exists between TDIC and the Emirate of Abu Dhabi (AA/Stable/F1+), which results in TDIC’s rating being aligned with Abu Dhabi’s sovereign rating. The primary rating driver for TDIC is its strong ties to the sovereign. The agency would not be able to rate this entity on a standalone basis due to its very limited operational assets.

FT Tilt - Post-revolution MENA: A new narrative for economic reform(Registration)

Last week's IMF/World Bank meetings saw policy-makers grapple with the challenge of crafting economic assistance packages to MENA countries, experiencing political transition. But the stakes are high and the devil is in the detail. As policy-makers flesh out the format and substance of these assistance packages, they will need an effective communications strategy to address the concerns of the local population.

Unlike the aftermath of the 1989 revolutions in Eastern Europe and the subsequent break-up of the Soviet Union, which were accompanied by a broad acceptance of the need for economic reform, many MENA countries have been adhering to economic liberalisation agendas for years.

Yet despite these broad-reaching and sometimes painful reforms, many citizens in the region, particularly among the younger generations, perceived that their personal economic opportunities have only become increasingly limited, especially as a result of corruption and weak job prospects (Figures 1- 2).

Youth unemployment in MENA and corruption levels in MENA vs other EMs

ANALYSIS-Kuwait faces reform stalemate after cabinet falls | Energy & Oil | Reuters

Kuwait has mostly escaped the unrest sweeping the Arab world, but its dysfunctional politics once again risk blocking economic reform and foreign investment.

The Gulf oil producer has long lavished cradle-to-grave welfare benefits and public sector jobs on its one million nationals, who also have a parliament that is keen to protect such privileges and often quick to stymie legislation proposed by governments dominated by the ruling al-Sabah family.

The cabinet resigned this month to avoid the questioning of three ministers in parliament. Kuwait's ruler has asked outgoing Prime Minister Sheikh Nasser al-Mohammed al-Sabah to form a new cabinet -- his seventh since he was first appointed in 2006.

Little interest in property trust - The National

Five months after the first real estate investment trust (REIT) was introduced in Dubai, local investors are showing little enthusiasm for the product.

There are no new property REITs scheduled to launch, Simon Gray, the director of supervision at the Dubai Financial Services Authority (DFSA), said this week. There is interest from financial institutions, but "it may take some time" for REITs to gain traction in the UAE, Mr Gray said.

The potential for REITs created a stir last year when the DFSA implemented a framework for creating the trusts. REITs were expected to add much-needed liquidity to the market, giving investors a low-cost vehicle to invest in property.

Taqa aims to secure $1.8bn for expansion - The National

The Abu Dhabi National Energy Company, also known as Taqa, plans to use high oil prices to ensure funds for a coming US$1.8 billion (Dh6.61bn) capital investment programme.

The government-controlled company, listed on the Abu Dhabi Securities Exchange General Index, has budgeted this year for projects that include power plant expansions and the construction of a large gas storage and distribution centre. This year's investment programme is $400 million more than last year's capital expenditures.

To ensure cash flow to fund this year's capital programme, Taqa is seeking to sell forward 50 per cent of its projected future oil and gas production from North America and the North Sea for the next 18 months, locking in recent crude prices above $100 a barrel.

Dubai gold miner goes for double or nothing - The National

A Dubai company has more than doubled its estimate of the size of a gold discovery in Yemen as the price of the precious metal hits an all-time high.

Thani Emirates Resource Holdings, a privately held minerals company, confirmed last year its Wadi Madden discovery contains at least 2.2 million ounces of gold reserves.

Now, new drilling results have indicated the probable presence of an additional 2.7 million ounces.

Dar al-Arkan first-quarter net down 31.5 pct | Reuters

Dar al-Arkan (4300.SE), Saudi Arabia's biggest property developer, reported a 31.5 percent drop in first-quarter net profit, the company said in a bourse statement on Wednesday, missing analyst forecasts.

Dar al-Arkan made 273 million riyals ($72.8 million) in the three months to end-March, down from 398.6 million in the same period a year earlier.

Analysts surveyed by Reuters on averge expected the firm to post a net profit of 342.0 million riyals.

Gulf Times – Draft law allowing GCC firms to open branches in Qatar approved

The weekly Cabinet meeting, chaired by HE the Prime Minister and Foreign Minister Sheikh Hamad bin Jassim bin Jabor al-Thani, yesterday approved a draft law allowing GCC companies to open branches in Qatar.

The Cabinet also approved a draft law amending some provisions of law No.8 of 2003 on autopsy. A draft decision of the Minister of Education and higher education on fixing the schedule of the 2011/2012 academic year, classes and its holidays was also approved.

Abu Dhabi’s IPIC, Oman sign oil cooperation deal - Arab News

Abu Dhabi’s International Petroleum Investment Company (IPIC) and Oman’s state oil firm Petroleum Development Oman (PDO) signed a cooperation agreement for investment projects in oil, gas and petrochemicals, Oman’s state news agency said.

The agreement will include of oil refineries and petrochemical projects as well as exchanging experience and technologies, said Nasser bin Khamees Al Jashmi, the undersecretary of oil and gas ministry.

He did not give any details about the exact plans or the timeline.

OPEC sees economic strain of high oil prices | News by Country | Reuters

Costly oil could place a major strain on consumer countries with fragile economies, OPEC ministers said on Monday, in their clearest statements yet that they believe fuel demand has shrunk.

Leading OPEC member Saudi Arabia on Sunday confirmed the kingdom had cut output by more than 800,000 barrels per day(bpd) in March because of weak demand.

Saudi Oil Minister Ali al-Naimi said economic recovery was still weak in some countries. - Comment: UAE banks must learn from past

The outlook for the United Arab Emirate’s banking sector is slowly improving. Interbank rates have fallen and markets are pricing-in further falls in the coming months – signs that monetary conditions are easing. The sector is no longer as leveraged. And banks have passed through the shock of the housing market collapse and the uncertainty over quasi-sovereign debt.

However, we need to be aware of the remaining challenges. These include non-performing loans resulting from the softer housing market and debt restructuring. Monetary policy is also constrained, leading to more volatile than necessary credit and business cycles.

Given that the UAE dirham is pegged to the US dollar and that capital can flow freely in and out of the country, one would expect it to have interest rates similar to those of the US. There are three reasons for the difference.

Dubai export credit agency seeks more funding - The National

The UAE's main export credit agency needs beefing up to help boost trade across the country, its chief executive says.

Demand is rising for export credit at a time of heightened instability in regional markets.

The Export Credit Insurance Company of the Emirates (ECIE) receives finance only from the Government of Dubai, where it is based.

FT Alphaville » The sanctions dodging Tunisia-Libya oil swap

Reuters’ Jessica Donati and Emma Farge on Wednesday spot some odd goings-on in the Tunisian port of La Skhira:

Oil trading and shipping sources said at least 120,000 tones of gasoline had arrived so far this month at La Skhira for ship-to-ship transfers, a figure that amounts to nearly half of Tunisia’s annual imports.

The UN, US and EU sanctions on Libya are some of the tightest in living memory, but as with any restriction limited to specific individuals and entities they are not inescapable. Here’s Donati and Farge again:

Muammar Gaddafi’s government is circumventing international sanctions to import gasoline to western Libya by using intermediaries who transfer the fuel between ships in Tunisia.

One intermediary company, Hong Kong-based Champlink,previously unknown to the oil trading community, has sought a transaction for fuel delivery into Libya, and European oil traders said they had been approached by other such firms.

In a fax, obtained by Reuters, Champlink approached trading firms with an “urgent” request stating, “we have been appointed as procurers for end user in Libya and looking for ready shipments for gasoline.”

The fax proposed either shipping directly to the western Libyan port of Zawiyah, near the capital Tripoli, or to Tunisia’s La Skhira, to be transferred onto a waiting tanker. - Probes spread alarm in Egypt’s businesses

Paul and George Bahna have, since January, scrambled to ensure the safety of their staff in Libya, where their company was involved in a rail project.

But their attention has now turned to Egypt, where Bahna Engineering Industries, the company founded by their father, has its headquarters and where the chairman of their most important client is in prison.

“These days when you say the name Ahmed Ezz, you might as well be saying Satan,” joked George Bahna. “It paralyses anyone involved with him – the divisions of his company, the banks that lent him money or handled his accounts. There is no liquidity. Everyone is afraid their head is next on the chopping block if they make the wrong decision.”

Qatar & UAE: still waiting for MSCI | beyondbrics –

Qatar may have snagged the World Cup and even post-crash Dubai is overrun with Wall Streeters, but the countries’ equity markets don’t even rank as emerging – MSCI, the influential index provider, still classifies them as frontier markets, alongside countries such as Serbia, Lebanon and Pakistan.

MSCI, whose indices are tracked by funds worth billions of dollars, will announce in June whether Qatar and the UAE’s bourses will qualify for its Emerging Markets index. But by the looks of it, investors are not optimistic that the countries will make the cut.

Investors have been left cold as they consider rising political risk in the region and still-restrictive caps on foreign investment in the two countries. And while the UAE and Qatar recently announced an improved settlement system for trades, as MSCI had recommended last June when the indexer decided to continue classifying the markets as frontier, brokers point out that the new system will be implemented just a blink before the MSCI’s announcement.