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Wednesday, 7 March 2012

Owners act in Egypt privatisation dispute -

Saudi investors have instructed lawyers to initiate arbitration proceedings against the Egyptian government, after a Cairo court annulled the privatisation of a public-sector company in 2005 and ordered its return to state ownership.
A spate of court cases seeking to renationalise privatised Egyptian assets has made foreign investors wary and prompted some to seek redress in international arbitration.

Australian companies reap Gulf rewards -

Companies from Australia, where manufacturing and services industries have been overshadowed by a commodities boom that swept across the economy, are looking to the Gulf to boost trade.
Long a prime destination for Australian exports ranging from cars to livestock, the Gulf is becoming a valued market for companies with more niche specialities, from irrigation to engineering.

MENA stock markets close March 7, 2012

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)

Saudi Arabia Must Boost Oil Supply by 300,000 Barrels, CGES Says - Bloomberg

Saudi Arabia (OPCRSAUD) should raise oil production by 200,000 to 300,000 barrels a day to prevent prices from damaging the world economy, according to the Centre for Global Energy Studies.
The world’s largest oil exporter needs to restore daily production rates to 10 million barrels a day, from 9.8 million currently, as price levels of more than $120 a barrel are crimping economic growth, according to the London-based Centre. Concern that demand is slowing just as Libya revives output will probably deter Saudi Arabia from making the necessary increase, CGES said.
“We’ve been in the danger zone since prices got to $100,” Leo Drollas, the CGES’s chief economist, said in a telephone interview today. “Economic growth will stutter globally; Europe is doldrums, and the U.S. is recovering but precarious.”

Qatar Exchange expands range of benchmark and tradable indices  | Hedgeweek

Qatar Exchange (QE) has launched a number of new equity indices to complement the existing QE Index. The new indices will be live from 1 April 2012.

A total return version of the QE index will be disseminated in real-time; measuring price performance and income from dividends, thus representing the total return earned in a portfolio tracking the underlying price index. QE will also introduce All Share and sector indices, a series that provides investors with an overall market benchmark and enhanced tools to evaluate sector performance in real-time.

In line with the industry sector indices, statistical and trading reports at Qatar Exchange will reflect seven primary sectors: Banks & Financial Services; Industrials; Transportation; Real Estate; Insurance; Telecoms; and Consumer Goods & Services.

Dubai’s Shares Retreat Most Since 2010; Arabtec Leads Drop Before Earnings - Bloomberg

Dubai’s stocks retreated the most in more than two years, the worst-performing equity market in the world today, ahead of Arabtec Holding Co. (ARTC) financial results and on concern over the success of Greece’s debt swap.
Arabtec, the biggest United Arab Emirates construction company that’s estimated to report a 57 percent drop in 2011 profit, slumped 9.9 percent. Dubai Financial Market PJSC (DFM) fell the most in more than seven weeks. The DFM General Index (DFMGI) slid 4.8 percent, the most since January 2010 and was the biggest daily decliner among 93 global indexes tracked by Bloomberg, to 1,607.77 at the 2 p.m. close in the emirate. Abu Dhabi stocks decreased 2.2 percent, the most since Aug. 7.

Sukuk issuance forecast to surge -

Global sukuk issuance is expected to rise 50 per cent this year, with companies turning to capital markets as banks reach lending limits, says HSBC.
A select band of issuers has been replaced by a broader pool of entities, from companies to government bodies, all seeking to tap the liquidity gushing around Islamic banks.

“We are forecasting a bright 2012, after the incremental increases since 2009 we are hitting a turning point,” says Mohammed Daoud, managing director of debt capital markets for HSBC Amanah, the bank’s sharia-compliant arm.

Qatar in talks for up to 20 A330 cargo conversions | Reuters

Qatar Airways threw its weight behind Airbus's latest project by expressing interest in converting up to 20 of its A330 passsenger jets into freighters, while pressing the European planemaker to improve its plans for the all-new A350.

Chief executive Akbar Al Baker, who had threatened to buy converted Boeing aircraft because of a gap in Airbus's cargo strategy, welcomed the planemaker's decision to launch an A330 "passenger-to-freight" option at last month's Singapore Air Show and said the two sides were in talks about a potential order.

He expressed confidence that Airbus and Boeing would iron out recent high-profile difficulties with aircraft production but said he remained unhappy with the performance, weight and capacity of Airbus's planned 370-seat carbon-fibre A350-1000.

UPDATE 1-Qatar's Doha Bank 5-yr dollar bond to price Wed | Reuters

Qatar's Doha Bank plans to issue a five-year dollar-denominated bond on Wednesday, with price guidance tightening ahead of the launch in an indication of strong investor demand for the debt sale.

Price guidance was revised to a range of 262.5 basis points to 275 basis points over midswaps before books closed, according to arranging banks. Initial guidance was 287.5 basis points over midswaps earlier in the day.

Two market sources said Doha Bank, Qatar's fifth largest lender by market cap, was due to issue a maximum of $500 million from the bond sale. One of the sources added that order books for the bond were in excess of $2 billion.

Dubai Financial Market intraday March 7, 2012

General Index
Intraday 3 month
Daily Statistics
General Index1607.77
Change (%)-4.82%
T. Volume468330654
T. Companies 64

Persian Gulf Stocks: Dubai’s Arabtec Holding and Jazeera Airways - Bloomberg

Dubai’s DFM General Index (DFMGI) sank 4.8 percent, the most since January 2010, to 1,607.77 at the 2 p.m. close in the emirate. Abu Dhabi’s ADX General Index (ADSMI) retreated for a third day, dropping 2.2 percent.
The following shares were active in the Persian Gulf region. Stock symbols are in parentheses.
Arabtec Holding Co. (ARTC) tumbled the most since December 2009, losing 9.9 percent to 2.93 dirhams. The United Arab Emirates’ biggest construction company may post a decline in 2011 profit to 133 million dirhams ($36 million), according to the average estimate of 12 analysts on Bloomberg.

gulfnews : UAE shares extend losses

UAE shares extended losses on Wednesday as local investors rushed to book profits from the recent rally amid a fresh wave of turbulence across global stock markets.
The Dubai Financial Market (DFM) General Index was down 3.44 per cent to 1,631.03 at 11.24am UAE time while Abu Dhabi's bourse had lost 1.6 per cent to 2,568.24.
Asian shares fell for the third day in a row on Wednesday on renewed uncertainty over Greece's bailout while US and European equity markets also saw heavy losses on Tuesday. The Dow Jones Industrial Average losing 1.57 per cent to 12,759.14, London's FTSE 100 declining 1.86 per cent to 5,765.8 and Frankfurt's Dax tumbling 3.4 per cent to 6,633.1.

First dim sum bond for the Gulf | beyondbrics –

Roll up, roll up. At Dubai’s bond market, it’s the dim sum special on sale this week. At a tasty yield of 4.875 per cent, you can get yourself a slice of Emirates NBD, the Dubai-based bank’s 750m renminbi ($119m) bond, the first of any such transaction from the Gulf.

The bond, rated A3 by Moody’s Investors Service, the seventh highest investment grade, is another sign that China is gaining economic traction in its increasing important trade partner, the oil-rich Gulf.

As China targets its economic diplomacy on commodity producers, the Gulf has come into sharper focus. Under pressure to shift away from Iranian oil imports, Premier Wen Jiabao has visited the region this year to strengthen China’s foothold.

Moody's downgrades Bahrain Islamic Bank's supported ratings to Ba3 with a negative outlook | Moody's |

Moody's has downgraded Bahrain Islamic Bank's (BisB) supported issuer ratings to Ba3 / Not Prime from Ba1 / Not Prime. In addition, Moody's confirmed the Bank Financial Strength Rating of BisB at E+, but changed its mapping on the long term scale to B3 from B1. All ratings carry a negative outlook. This rating action concluded the review for downgrade initiated on 1 June 2011.

National Bank of Abu Dhabi eyes regional mandates - Banking & Finance -

National Bank of Abu Dhabi (NBAD), the largest lender by market value in the UAE, is set to take on regional mandates to add to its home-market advantage, the head of the bank's debt capital markets team said.
The bank is pitching more aggressively for mandates in other Gulf Arab states, Fawaz Abu Sneineh told Reuters in an interview this week.
"We are trying to diversify outside the UAE, especially in the FI (financial institutions) space. We are pitching to Qatari banks, and in Oman," Abu Sneineh said, adding that Jordan, Malaysia and Turkey were also potential markets, but on a more opportunistic basis.

gulfnews : Du proposes dividend as profit soars 47.8%

Telecom operator du has proposed its first dividend payment to shareholders after accepting a "fair and reasonable" increase in royalty payments to the UAE Federal Government.
Du, which posted a robust set of financials on Tuesday, said its net profit before royalty grew by 47.8 per cent to Dh1.8 billion in 2011, leading the company to propose a dividend of 15 fils per share.
However, du also had to take into account the Government's new royalty structure, which will see the company pay over 15 per cent of its 2011 net profit, along with a further five per cent of revenues.

First Gulf Bank climbs after generous payout - The National

The generosity of First Gulf Bank (FGB) to shareholders has clearly piqued the market's interest in the stock.

FGB's payout - Dh1.5 billion to shareholders, plus a free share for every one held - was bigger than any other bank in the industry this year. And analysts from JPMorgan believe that similarly generous payouts could follow in the years ahead.

"We believe that in the next 1-2 years, FGB management will continue to maintain a high focus on enhancing future return on equity via distribution of a higher dividend payout," analysts from the bank wrote in a research note.

Deposits up but lending decreases - The National

Bank lending dipped in December and deposits returned to the UAE banking system in large volumes, narrowing the gap between loans and deposits across the sector.

Bank lending decreased by 0.3 per cent in December to Dh1.07 trillion (US$291.3 billion), a four-month low, according to the Central Bank. Total credit extended last year was 3.8 per cent higher than for the previous year.

However, a surge of liquidity pushed deposit levels to their highest since August. Deposits rose 1.5 per cent from November to Dh1.06tn, an increase of 1.9 per cent from the same period a year earlier.

Saudi Arabia Continuous Dependence On Oil Toughest Challenge: Al-Naimi

A top-ranking member of the Saudi Cabinet has called for urgent steps to advance and develop the Kingdom’s downstream industries with a view to stimulating the economy, generating jobs and creating investment opportunities for small and medium enterprises.

Ali I. Al-Naimi, the minister of petroleum and mineral resources, was delivering a keynote address at the 2nd Saudi Downstream Strategic Forum on Tuesday. The two-day event, being organized by the Royal Commission for Jubail and Yanbu, has acquired immense importance in the industrial circles because of Custodian of the Two Holy Mosques King Abdullah’s patronage.

Jazeera Airways Group posts net profit of KD10.6m for FY 2011 | Kuwait Times

Jazeera Airways Group yesterday announced its financial results for full year 2011, reporting a record KD10.6 million in net profit for the year with an earnings per share of 0.048 fils, a record KD57.8 million in revenue for the year, up 36% from last year, and a record KD14.9 million in operating profit for the year.
The results reflect the success of the company’s Turn-Around Plan implemented in second quarter 2010 and steered the company into continued profitability for the last six quarters, five of which had realized record-breaking earnings.
The company also announced its fourth quarter 2011 results, reporting a net profit before tax of KD1.4 million and revenues of KD13.3 million.

UAE's Microsol buys key assets of insolvent Solon | Reuters

United Arab Emirates-based solar cell maker Microsol has acquired the key assets of Solon and its subsidiaries, including U.S.-based Solon Corp, the insolvent German solar group said.

About 600 jobs worldwide have been transferred from Solon to the newly formed Solon Energy GmbH and other affiliates, the company said.

The purchase price was not disclosed. Solon said an approval by Italian authorities was still pending.

MGM Resorts International Shareholders Suffer From Murren's CityCenter Disaster - Seeking Alpha

If you are an MGM Resorts International shareholder (MGM), current CEO Jim Murren's decision to build the $9.5 billion City Center resort has been a complete disaster. Even worse, the idea that the project will eventually yield any kind of positive return on invested capital in the near future is at best far fetched. Let's do the analysis to see why.

MGM CityCenter

The CityCenter is a project on the south side of the Las Vegas Strip and is comprised of the Aria Resort and Casino, the Vdara Hotel & Spa, the Mandarin Hotel & Luxury Residence complex, and Crystals Shopping, Dining, and Entertainment mall.

Based on MGM's 2011 Annual Report filed 2/29/2012, MGM resorts currently carries the MGM CityCenter property on the balance sheet at a value of approximately $9.5 billion. The $9.5 billion is broken down in the following manner:

Equity: $6.6 billion
Long-Term Debt: $2.5 billion
Current Liabilities: $.4 billion

Gulf Daily News » Financial institutions on the rise in Bahrain

The number of financial institutions registered in Bahrain continued to rise last year, reaching 415 by the end of January 2012, up from 403 a year earlier.

The kingdom saw a number of successes in the last few months of 2011 as financial institutions such as Notz Stucki and Altaira Middle East set up offices in Bahrain.

Among the financial firms that have registered in Bahrain during the course of 2011 are Canara Bank, AMP Capital Investors and Deloitte Corporate Finance.

FT Alphaville » Oil in time

A chart from a presentation last week by Maria van der Hoeven, executive director of the International Energy Agency (IEA):

FT Alphaville » Economistocracy declares oil the new Greece…

At least that’s the message from recent notes by Credit Suisse and HSBC, though we suspect this will change as we near the moment next week when we find out the results of the debt restructuring. Surely Greece will then be the new, ahem, grease.

(And after which, if everything goes smoothly, oil will be the new Greece, again, as everyone looks ahead to the FOMC meeting.)

First up are the hope-mongers from Credit Suisse, who argue that the US economy is on sounder footing than it was last year and there will probably be less of a shock factor, emphasis ours:.............