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Tuesday, 27 December 2016

Oil in 2016: the return of Opec

Oil in 2016: the return of Opec:
"After a two-year experiment with free markets, the pain of low oil prices forced the world’s biggest producers to join forces in 2016 and tackle a global supply glut.

Saudi Arabia-led Opec and non-member countries, primarily Russia, agreed after months of discussion and back channel diplomacy to cut production for the first time since the global financial crisis.

Prices look set to end the year in the mid-$50s — about double the 13-year intraday low of $27.10 a barrel Brent touched in January — with hedge funds more bullish on oil than they have even been. A growing number of analysts and investors believe the cuts will reduce stockpiles, bringing supply and demand into balance more quickly next year."

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Tadawul closes at highest level since December 3 last year | The National

Tadawul closes at highest level since December 3 last year | The National:
"Saudi Arabia’s index rose to its highest point for the year as the market continued to react to news of the country’s lower than expected budget deficit.

The Tadawul All Share Index closed up 1.27 per cent on Tuesday at 7,257.17 – its highest since December 3 last year – as investors continued to react to last week’s news from the Saudi finance ministry that the government would post a deficit of 297 billion Saudi riyals (Dh290bn) for this year, 9 per cent lower than its initial estimate for the year and an 19 per cent reduction on 2015’s record shortfall.


It was led by gains from the car company Saudi Automotive Services and the advertising company Tihama."

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Meydan Group secures Dh1b financing from Adib | GulfNews.com

Meydan Group secures Dh1b financing from Adib | GulfNews.com:
"The master-developer Meydan Group has secured a Dh1 billion financing from Abu Dhabi Islamic Bank (Adib) that would go to part-finance projects that will line up along the Dubai Water Canal and for general corporate expenditure. There are about 15 to 20 prime plots that the developers of the Canal — Meydan and Meraas — have right on the water-side, extending from the Safa Park all the way through Jumeirah and the sea.
Meydan intends to develop the plots it owns for a soon-to-be-expanded leasing portfolio. These properties will have some of the most coveted sites in Jumeirah, boosted in no part by proximity to the water’s edge. “None of the Canal plots on the Safa Park side of Shaikh Zayed Road have been released — what have been announced are from private developers on the other side of the Rod,” said a top official with Meydan.
“We should have details about how the properties on our plots will shape up in 2017, most likely in the second half.” (Currently, less than 10 per cent of the Meydan revenue stream is made up of its leased portfolio.)"

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Abu Dhabi to Permit Short Selling in Attempt to Boost Liquidity - Bloomberg

Abu Dhabi to Permit Short Selling in Attempt to Boost Liquidity - Bloomberg:
"Abu Dhabi is poised to introduce services facilitating short-selling next year as it seeks to boost trading volume and attract foreign investors to the illiquid market.

ADX, as the local exchange is known, is conducting meetings with brokerages in the United Arab Emirates ahead of introducing a so-called technical short-selling service early in 2017, according to a statement posted on the bourse’s website on Monday. The step would make Abu Dhabi the first stock market in the six-nation Gulf Cooperation Council to permit the sale of securities owned by another investor.

Boosting liquidity in share trading is one of the biggest challenges for local regulators and stock exchanges in the Gulf. Since the start of 2015, the stocks of at least half of the 62 members comprising the ADX General Index have finished each trading session unchanged."

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UPDATE 1-Kuwait's NBK, KAMCO invited to participate in Kuwaiti sovereign bond issue | Reuters

UPDATE 1-Kuwait's NBK, KAMCO invited to participate in Kuwaiti sovereign bond issue | Reuters:
"National Bank of Kuwait (NBK) , the Gulf Arab state's largest commercial lender, and investment firm KAMCO said they had been invited by the public debt office at the Kuwaiti ministry of finance to participate in a bond issue by the government.

A request for proposals has been sent to NBK's subsidiary NBK Capital to help arrange a sovereign U.S. dollar-denominated bond issue, and the deadline to respond is Jan. 5, NBK said in a bourse statement on Tuesday. The request is under study, it added.

Finance Minister Anas al-Saleh said in July that the government planned to sell as much as $10 billion of U.S. dollar-denominated conventional and Islamic bonds in international markets to help plug its budget deficit for the current fiscal year, which will end on March 31. "

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MIDEAST STOCKS-Banks boost Saudi to high for year, rest of Gulf sluggish | Daily Mail Online

MIDEAST STOCKS-Banks boost Saudi to high for year, rest of Gulf sluggish | Daily Mail Online:
"Banking shares boosted Saudi Arabia's stock index on Tuesday to its highest level this year, while other Gulf markets moved little in quiet trade with some foreign investors absent for New Year holidays.

The Saudi index closed up 1.3 percent at 7,257 points in its highest trading volume for two weeks, rising above technical resistance at this year's previous peak of 7,235 points hit in early December.

The banking sector surged 1.8 percent as the biggest lender, National Commercial Bank, climbed 2.1 percent. Banks underperformed the market in the initial reaction to the 2017 state budget at the start of this week, when activity focused on other sectors including petrochemicals."

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Oil rallies in thin trade, adds to year's gains | Reuters

Oil rallies in thin trade, adds to year's gains | Reuters:
"Oil gained 1.5 percent Tuesday, continuing its year-end rally with support from expectations of tighter supply once the first output cut deal between OPEC and non-OPEC producers in 15 years takes effect on Sunday.

U.S. crude prices have surged 25 percent since mid-November, helped by expectations for OPEC's supply cut and generally solid U.S. economic figures that have also bolstered equity prices.

Trading was thin on Tuesday as just 257,000 front-month futures contracts traded, less than one-half of the usual volume in West Texas Intermediate crude futures. With oil near $54 a barrel, U.S. crude is not far from the year's high of $54.51 high reached on December 12."

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Brent curve signals oil tanks will start emptying in second half of 2017: Kemp | Reuters

Brent curve signals oil tanks will start emptying in second half of 2017: Kemp | Reuters:
"OPEC and non-OPEC oil producers have agreed to reduce their combined output by more than 1.7 million barrels per day for six months from January 2017.

But the agreement contains a provision that it can be extended for a further six months, subject to market conditions.

Oil traders are betting on an extension, with most of the rebalancing of the oil market expected to occur in the second half of 2017."

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MIDEAST STOCKS-Gulf barely moves in early trade | Reuters

MIDEAST STOCKS-Gulf barely moves in early trade | Reuters:
"Gulf stock markets barely moved in thin, early trade on Tuesday with some foreign investors absent for New Year holidays and few fresh cues from corporate news or global markets.

Saudi Arabia's index edged up 0.1 percent to 7,172 points in early trading. It faces technical resistance at this year's peak of 7,235 points.

Saudi Electricity, which had risen on Sunday after Riyadh's 2017 state budget promised power tariff hikes later this year, pulled back, losing 2.0 percent."

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