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Sunday, 6 May 2012

MENA stock markets close - May 6, 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)

Oil price drop not to impact UAE growth prospect: expert - Xinhua |

Oil prices retreated over 4.5 percent in the last four weeks, but the decrease does not change the perspective of the United Arab Emirates' (UAE) economic growth of 2.6 percent in 2012, an expert with the National Bank of Abu Dhabi (NBAD) said Sunday.

Oil prices fell sharply on Friday to hit 98.5 U.S. dollars per barrel. The fall translated to a one-month loss of 4.5 percent.

Giyas Gokkent, Chief Economist and Head of Research at NBAD, told Xinhua in an interview that several factors are at play for the recent fall in oil prices.

UPDATE 1-Air Arabia beats forecasts as Q1 net rises 11.7 pct - Yahoo! News UK

UAE budget carrier Air Arabia said quarterly net profit rose 11.7 percent, beating analysts' forecasts, as a hike in fuel costs was offset by a rise in number of passengers seeking low-cost flying options.
Air Arabia earned a net profit of 47.7 million dirhams ($13 million) for the first-quarter, it said in a statement on
Sunday, compared with 42.7 million dirhams profit a year earlier.
Revenues for the quarter was 621 million dirhams, an increase of 21 percent to the 513 million dirhams it posted in the same period of 2011.

Dubai Shares Drop in Longest Losing Streak Since 2006 - Businessweek

Dubai shares fell for an eighth day, the longest losing streak since 2006, after U.S. job data fueled concern the global economy is weakening and on speculation political instability in Iran may intensify.

Emaar Properties PJSC (EMAAR), developer of the world’s tallest skyscraper, decreased 1.9 percent. Dubai Investments PJSC (DIC), whose portfolio includes more than 40 companies, fell to the lowest level in more than two months. The DFM General Index (DFMGI) retreated 1.4 percent to 1,560.28, the lowest since Feb. 16, at the 2 p.m. close in Dubai. The gauge has declined 6.6 percent in the past eight days, trimming a rally for the year to 15 percent. Egyptian stocks advanced for a second day.

“Investment sentiment is negative following weak employment and economic numbers from the U.S. over the weekend,” said Nabil Farhat, a partner at Abu Dhabi-based Al Fajer Securities. “There is also worry about the political turmoil with Iran.”

DIFC Investments has likely sold Smartstream: JP Morgan | Alrroya

DIFC Investments (Difci), the investment arm of the company running Dubai's financial free zone, has likely sold software company SmartStream Technologies, resulting in a $68.8 million impairment provision, JP Morgan said in a research note.

Difci, which has been grappling with a debt pile including a $1.25 billion Islamic bond due in June, began seeking buyers for Smartstream in 2010 to raise much-needed cash.

In a footnote in its 2011 financial statements last week, Difci said it sold one of its discontinued businesses held-for-sale after the financial year ended to a 'related party.' It did not name the business.

Egypt Shares Gain After EFG-Hermes Agrees on QInvest Partnership - Businessweek

Egypt’s benchmark stock index headed for the highest close in more than a month after EFG-Hermes Holding SAE (HRHO) and Qatar’s QInvest LLC said they plan to create an investment bank in Egypt.

EFG-Hermes shares were suspended by the bourse pending the release of more information. Talaat Moustafa Group (TMGH) Holding, the country’s biggest publicly traded real estate developer climbed 5.3 percent. Commercial International Bank Egypt SAE (COMI), also known as CIB, rose for the first time in three days. The EGX 30 Index (EGX30) gained 1.2 percent to 4,987.44 at 12:28 p.m. in Cairo, poised for the highest close since March 29.

EFG-Hermes, the biggest publicly traded Arab investment bank, said May 4 it agreed to start an investment bank that will be 60 percent owned by the Qatari company. QInvest, a unit of Qatar Islamic Bank (QIBK), will invest $250 million in the venture. The bourse canceled all March 3 trades in EFG-Hermes, without giving a reason. The stock is up 31 percent this year, compared with a 38 percent gain for the EGX 30.

Arabtec-TAV Group Is Preferred Bidder for Abu Dhabi Deal - Bloomberg

A group including Arabtec Holding Co. (ARTC), TAV Insaat and Consolidated Contractors Co. is the preferred bidder for the construction of the new terminal building at Abu Dhabi airport.
“Abu Dhabi Airports Co. is currently in discussions with the preferred bidder to finalize all details of the contract prior to its signing, and before officially announcing the winning contractor of the midfield terminal building at the capital’s airport in June this year,” according to an e-mailed statement from Abu Dhabi Airports today.
Abu Dhabi is expanding the international airport to meet the growth of Etihad Airways, among the fastest-growing Middle Eastern carriers. The airline ordered 100 jets at the 2008 Farnborough Air Show and is on the acquisitions trail, with stakes in Air Berlin Plc, Air Seychelles Ltd. and Aer Lingus. (AERL) The United Arab Emirates’ capital city and holder of about seven percent of the world’s proven oil reserves plans to spend $500 billion on industry, tourism and culture through 2030 to reduce its reliance on hydrocarbons.

Increasing appetite for cross-border deals, as businesses seek growth outside home markets - Zawya

More than three-quarters (78%) of respondents to Clifford Chance 's Cross-border M&A: Perspectives on a changing world survey of large global companies are looking for growth outside of their established domestic markets. The research study into current trends in cross-border M&A found that over half of companies surveyed (56%) are focusing their M&A strategy on the high growth economies.

The research, which was conducted by the Economist Intelligence Unit on behalf of Clifford Chance , surveyed nearly 400 companies each with revenues of more than US$1 billion, including 80 chief executives and 185 other C-level executives from a wide range of industries and regions. Respondents were asked to rank their top strategic drivers and perceived risks and barriers to cross-border M&A activity.

Standard and Poor's publishes report card on its rating universe in Gulf Cooperation Council countries | Standard & Poor's |

As fears of political instability fan the Gulf, high hydrocarbon prices are continuing to underpin the economies of oil exporters Saudi Arabia, Kuwait, Qatar, United Arab Emirates, Oman, and Bahrain, said Standard & Poor's Ratings Services in its report card.

"Oil-rich economies in the Gulf are increasingly pulling ahead of the region's other economies, on the back of continuously high oil prices," said Standard & Poor's credit analyst Tommy Trask, "and the high prices support ratings across a range of corporate and infrastructure sectors, including oil & gas up- and downstream as well as sectors relying indirectly on commodity led growth such as trade."

Outside the oil sector, tourism and trade volumes have risen in the UAE, according to government data, benefiting from the slackness in commercial and tourism hubs such as Bahrain and Egypt, where the Arab Spring protests have taken their political and economic toll.

Dubai Shares Drop an 8th Day on Global Economy and Iran Concern - Bloomberg

Dubai shares fell for an eighth day in the longest stretch of losses since 2006 after U.S. job data fueled concern the global economy is weakening and on speculation political instability in Iran may intensify.
Arabtec Holding Co. (ARTC), the biggest builder in the United Arab Emirates by market value, headed for the lowest close in more than two weeks. Emaar Properties PJSC (EMAAR), developer of the world’s tallest skyscraper, decreased 1.9 percent. The DFM General Index (DFMGI) retreated 1.6 percent to 1,557.31, headed for the lowest close since Feb. 16, at 11:02 a.m. in Dubai. The gauge has declined 6.8 percent in the last eight days, trimming a rally for the year to 15 percent. Saudi Arabia’s benchmark Tadawul All Share Index (SASEIDX) yesterday slumped 1.3 percent.
“Investment sentiment is negative following weak employment and economic numbers from the U.S. over the weekend,” said Nabil Farhat, a partner at Abu Dhabi-based Al Fajer Securities. “There is also worry about the political turmoil with Iran.”

WORLD EXCLUSIVE: Selling Emirates Airline could “make sense” – vice chairman - Culture & Society -

Sir Maurice Flanagan, executive vice chairman and one of the founders of Emirates Airline, has revealed that “it would make sense” to sell the airline in the future, in order to help service Dubai’s mountain of debt. Experts estimates that such a sale would generate up to US$11bn.
“I wouldn’t like to see it happen,” Flanagan said when asked if the airline, the largest in the region and one of Dubai’s most prized assets, would ever be sold. However, he conceded it had not been ruled out as a source of revenue to help finance Dubai’s debts, estimated by the IMF to be around $109bn.
“I don’t think it is being seriously thought of, but the time might come when it would make sense to do that,” Flanagan added, in an interview to be published in Arabian Business next Sunday.

Gulf debt market potential - Zawya

While the Gulf markets have enjoyed a good year so far, GCC debt market has not been able to reverse its year-to-date underperformance versus other emerging market benchmarks.

"While global EM credit funds have enjoyed healthy inflows, most GCC credits are not included in global EM benchmark indices and may thus have been unable to benefit from these flows to the full extent," said Andreas Kolbe, an analyst at Barclays Capital.

Gulf corporate earnings were strong in the first quarter and the healthy inflow of hydrocarbon-related revenues and government spending in the economies should give investors the confidence to participate in the bond bonanza that's gathering steam.

gulfnews : Rating agencies balance region's culture with Western expectations

The rating agencies came in for a bit of a rough ride over the course of the global financial crisis, but their enhanced presence in the region and the growth of ratings for GCC entities might still be taken as an indication of the Gulf's internationalisation. That, presumably, is still believed to be a good thing.
Yet, to the extent that foreign funding is sought for local projects, engaging with its providers is required. Even if the intrinsic mechanisms and assumptions of the ratings architecture can be debated, borrowers usually don't dictate the terms of borrowing, and especially not in an environment where the word risk has assumed mammoth proportions.
Sensitivities undoubtedly rose over such matters, notably in the US and Europe. In the Gulf too, the idea of a degree of cultural mismatch as well as material differences might still be in evidence.

gulfnews : GCC Focus: Mighty Saudi economy getting stronger

Numerous indications point to the steady growth of the Saudi economy, thereby further strengthening the global position of the kingdom's gross domestic product (GDP). These factors include relatively high oil prices, solid oil output, and strong spending.
To be sure, nominal or market prices of Saudi Arabia's GDP amounted to $577 billion (Dh2 trillion) in 2011, or number 20 worldwide. This is an exceptional achievement by virtue of placing Saudi GDP ahead of several European economies including those of Sweden, Poland, Belgium, Norway and Austria, to name a few.
Undisputedly, Saudi Arabia's GDP is the largest in the Arab world. This partly explains the fact that the kingdom is the sole Arab country in the G20, in turn comprising the largest economies in the world.

Social responsibility in the UAE should be everyone's pleasure - The National

Last week I had an interesting meeting with the chief executive of a financial company who told me about an upcoming project - an annual fund-raising initiative to give back to Abu Dhabi. It is the company's first initiative of this sort.

I was excited to hear him utter these words. It is true that the UAE is a pioneer when it comes to the amount of money raised for various charitable causes; however, to see organisations willing to shift their focus away from making profit for a while to actually making a difference in society is always marvellous, no matter how many times we hear about such initiatives.

The chief executive wants to involve his staff in this humanitarian project by encouraging them to donate so that they too feel that they have made a difference in society. He did not want just to donate a large sum, but rather to make sure that the money was given to a humanitarian organisation that helped special-needs children in Abu Dhabi.

Cairo tries again for IMF help with debt - The National

A recovery in Egypt's economy now hinges on a fast deal with the IMF for a US$3.2 billion (Dh11.75bn) loan.

The North African nation's risk of a balance-of-payments crisis and sharp currency devaluation rises as it awaits an agreement this month.

A series of blows to a final agreement with the IMF have raised fresh concerns about whether Egypt can sustain its fiscal situation much longer. Last month, the parliament rejected the government's new economic plan, the key to the country's request for the $3.2bn loan. Only six of 365 members of the assembly, which is dominated by the powerful Muslim Brotherhood, voted in favour of the plan.

Slow bank lending is a threat to UAE recovery - The National

Sluggish bank lending is threatening to put the brake on the UAE's economic rebound this year amid signs of faltering global growth.

First-quarter results from the country's top five lenders reveal they increased their loan books by just 0.7 per cent to Dh648.3 billion (US$176.49bn).

That represents about half the rate of loan growth in the same period last year and coincides with a faltering economic recovery in Europe and the United States. Oil dropped to below $100 a barrel on Friday for the first time since February as US labour department data showed employers hired fewer workers than forecast.

Summer interlude for UAE markets comes early - The National

Sell in May and go away, the old adage goes. With the traditional summer lull approaching and Ramadan less than three months away, many traders appear already to have fled the UAE's markets.

Trading values on the Dubai Financial Market dipped below their six-month average last week as investors sat on the sidelines.

Markets had been expected to experience a rise in sentiment as the Jebel Ali Free Zone Authority and DIFC Investments, two government-linked holding companies, said they had entered talks with creditors to refinance Islamic bonds worth a total of US$3.25 billion.

Gulf Times – Kuwait’s corporate bond market sees boom times

In a region dominated by sovereign and government-related bond issues, Kuwait has bucked the trend over recent months with a series of successful corporate sales that hint at greater capital-raising potential in the Gulf state.
The global financial crisis hit Kuwaiti investment companies hard, pushing some into debt restructuring talks and making banks cautious about lending. Meanwhile, the eurozone debt crisis is causing European banks to pull in their horns.
Bank lending to the private sector grew just 3.2% from a year earlier in February, which was slow considering private analysts expect Kuwait’s gross domestic product, buoyed by high oil prices, will expand about 3.8% this year in inflation-adjusted terms. So Kuwaiti corporations may have little choice but to diversify their funding into bonds.