HSBC is due to test demand for Middle East exchange-traded funds this month, when the bank resurrects plans to launch a sharia-compliant vehicle to trade on Saudi Arabia's stock market.
The bank had planned that its ETF be launched by the end of last year but it now says the fund will be ready in three weeks' time. It will track the top 20 sharia-compliant Saudi companies that form an index created by Standard & Poor's.
"We believe there's international demand for Saudi exposure," says Dan Rudd, head of Middle East wholesale banking for HSBC's asset management unit.
Wednesday, 2 November 2011
MIDEAST STOCKS-Saudi index up ahead of holidays; Gulf mixed | Reuters
Saudi Arabia and Qatar's markets closed higher on Wednesday, supported by gains in world stocks and higher oil prices ahead of a Federal Reserve meeting that may hint at more monetary easing, while other Gulf markets slipped.
Saudi Basic Industries Corp (SABIC) added 1.3 percent after the petrochemicals producer launched a new venture capital arm to invest in new technology.
The kingdom's benchmark rose 1 percent, trimming 2011 losses so far to 6.1 percent. It ended lower on the previous three days after hitting a 12-week closing high of 6,236 points on Saturday.
Saudi Basic Industries Corp (SABIC) added 1.3 percent after the petrochemicals producer launched a new venture capital arm to invest in new technology.
The kingdom's benchmark rose 1 percent, trimming 2011 losses so far to 6.1 percent. It ended lower on the previous three days after hitting a 12-week closing high of 6,236 points on Saturday.
Bahrain tests investor appetite in November sukuk roadshow | Energy & Oil | Reuters
Bahrain will attempt to tap international investors for the first time since political unrest hit the country this year, announcing it will roadshow a benchmark-sized, dollar-denominated Islamic bond later this month.
Investor meetings will start after next week's Eid al-Adha holiday, taking place simultaneously in Saudi Arabia and Kuala Lumpur on Nov. 14 and London and Singapore on Nov. 15, a lead manager said on Wednesday.
BNP Paribas , Citigroup and Standard Chartered have been mandated to run the potential ijara sukuk issue, he added.
Investor meetings will start after next week's Eid al-Adha holiday, taking place simultaneously in Saudi Arabia and Kuala Lumpur on Nov. 14 and London and Singapore on Nov. 15, a lead manager said on Wednesday.
BNP Paribas , Citigroup and Standard Chartered have been mandated to run the potential ijara sukuk issue, he added.
MENA stock markets close - November 2, 2011
| Exchange | Status | Index | Change | ||||
 | TASI (Saudi Stock Market) | 6215.67 | 0.98% | ||||
 | DFM (Dubai Financial Market) | 1377.48 | -0.38% | ||||
| ADX (Abudhabi Securities Exchange) | 2490.17 | -0.25% | ||||
 | KSE (Kuwait Stock Exchange) | 5916.8 | 0.01% | ||||
 | BSE (Bahrain Stock Exchange) | 1148.12 | 0.15% | ||||
 | MSM (Muscat Securities Market) | 5556.05 | -0.48% | ||||
 | QE (Qatar Exchange) | 8579.97 | 0.59% | ||||
 | LSE (Beirut Stock Exchange) | 1191.73 | -0.06% | ||||
 | EGX 30 (Egypt Exchange) | 4389.45 | -0.04% | ||||
 | ASE (Amman Stock Exchange) | 2004.33 | -0.89% | ||||
 | TUNINDEX (Tunisia Stock Exchange) | 4694.6 | 0.29% | ||||
 | CB (Casablanca Stock Exchange) | 11200.7 | -0.33% | ||||
 | PSE (Palestine Securities Exchange) | 471.68 | -0.15% | ||||
Air Arabia Q3 profit falls over 26%
Air Arabia, the first and largest low-cost carrier (LCC) in the Middle East and North Africa, on Tuesday reported more than 26 per cent decline in its third quarter net profit, compared with the same period last year.
The Sharjah-based budget airline said its financial results for the three months ending September 30, 2011, demonstrating sustainable profitability during the third quarter of this year.
Air Arabia’s net profit for the three months ending September 30, 2011, which was in line with analyst forecasts, stood at Dh100 million, compared to Dh136 million in the corresponding period in 2010.
The Sharjah-based budget airline said its financial results for the three months ending September 30, 2011, demonstrating sustainable profitability during the third quarter of this year.
Air Arabia’s net profit for the three months ending September 30, 2011, which was in line with analyst forecasts, stood at Dh100 million, compared to Dh136 million in the corresponding period in 2010.
Regulator steps in to aid UAE brokerages - The National
The financial market regulator has developed guidelines to help encourage cash-strapped brokerages to merge amid depressed market conditions and slumping volumes.
The move by the Securities and Commodities Authority (SCA) comes as many brokers seek to wind up their operations as business slows.
"As part of our ongoing encouragement to brokerages to merge and create a stronger entity that is able to withstand low volumes in challenging times, we have introduced special provisions to deal with mergers, to regulate the process and protect the rights of all parties," said Maryam Al Suwaidi, the deputy chief executive at the SCA.
The move by the Securities and Commodities Authority (SCA) comes as many brokers seek to wind up their operations as business slows.
"As part of our ongoing encouragement to brokerages to merge and create a stronger entity that is able to withstand low volumes in challenging times, we have introduced special provisions to deal with mergers, to regulate the process and protect the rights of all parties," said Maryam Al Suwaidi, the deputy chief executive at the SCA.
Warning over downgrade puts DIFC Investments under pressure - The National
Standard & Poor's has warned of a potential downgrade of the credit rating of DIFC Investments, the investment arm of Dubai's financial free zone, if it cannot make progress selling assets and refinancing its upcoming debt repayments by the beginning of next year.
The credit rating agency raised the alarm in a report this week warning of the sluggish pace of asset sales at DIFC Investments, which is attempting to repay a US$1.25 billion (Dh4.59bn) sukuk that comes due next June.
While S&P said it was highly likely that DIFC Investments would receive support from the Dubai Government, the ratings agency warned that a lack of progress in asset sales or refinancing efforts could trigger a downgrade of DIFC Investments' credit rating.
The credit rating agency raised the alarm in a report this week warning of the sluggish pace of asset sales at DIFC Investments, which is attempting to repay a US$1.25 billion (Dh4.59bn) sukuk that comes due next June.
While S&P said it was highly likely that DIFC Investments would receive support from the Dubai Government, the ratings agency warned that a lack of progress in asset sales or refinancing efforts could trigger a downgrade of DIFC Investments' credit rating.
EU crisis to hit GCC SWFs: analyst - Emirates 24/7
State funds in Gulf hydrocarbon producers could suffer from a fresh bout of losses because of the European Union debt crisis following a sharp decline in their assets in the wake of the 2008 global fiscal distress, a well known Gulf economist has said.
While the EU economic slowdown means slackening oil demand and consequently lower crude prices, Gulf countries and other OPEC members have taken measures to offset the crisis and keep prices strong, said Mohammed al Asumi, a former adviser at the Dubai Executive Office and head of economic research at the state-run Emirates Industrial Bank.
But Asumi said such measures would not apply to sovereign wealth funds (SWFs) in the six-nation Gulf Cooperation Council (GCC) as an expected fall in the shares of many EU banks would inflict heavy losses on those SWFs.
While the EU economic slowdown means slackening oil demand and consequently lower crude prices, Gulf countries and other OPEC members have taken measures to offset the crisis and keep prices strong, said Mohammed al Asumi, a former adviser at the Dubai Executive Office and head of economic research at the state-run Emirates Industrial Bank.
But Asumi said such measures would not apply to sovereign wealth funds (SWFs) in the six-nation Gulf Cooperation Council (GCC) as an expected fall in the shares of many EU banks would inflict heavy losses on those SWFs.
Egyptian banks, Egypt, Moodys's, Bank of Alexandria, Commercial International Bank, National Bank of Egypt, Banque Misr, Banque du Caire, Commercial International Bank | alifarabia
Moody’s Investors Service has today downgraded the local-currency (LC) deposit ratings of the following five Egyptian banks:
– National Bank of Egypt (NBE) to B1 from Ba3
– Banque Misr (BM) to B1 from Ba3
– Banque du Caire (BdC) to B1 from Ba3
– Commercial International Bank (Egypt) SAE (CIB) to Ba3 from Ba2
– Bank of Alexandria SAE (BoA) to Ba2 from Ba1.
The foreign-currency (FC) deposit ratings of all these banks were also downgraded to B2 from B1, capped by Egypt’s FC bank deposit ceiling.
The rating actions follow Moody’s decision to downgrade Egypt’s government bond ratings to B1 from Ba3, and the downgrade of the country ceiling on FC bank deposits to B2 from B1 (see “Moody’s downgrades Egypt’s debt rating to B1, negative outlook”, published on 27 October 2011).
All of the banks’ deposit ratings carry a negative outlook. For a full list of affected ratings, please refer to the end of this press release.
– National Bank of Egypt (NBE) to B1 from Ba3
– Banque Misr (BM) to B1 from Ba3
– Banque du Caire (BdC) to B1 from Ba3
– Commercial International Bank (Egypt) SAE (CIB) to Ba3 from Ba2
– Bank of Alexandria SAE (BoA) to Ba2 from Ba1.
The foreign-currency (FC) deposit ratings of all these banks were also downgraded to B2 from B1, capped by Egypt’s FC bank deposit ceiling.
The rating actions follow Moody’s decision to downgrade Egypt’s government bond ratings to B1 from Ba3, and the downgrade of the country ceiling on FC bank deposits to B2 from B1 (see “Moody’s downgrades Egypt’s debt rating to B1, negative outlook”, published on 27 October 2011).
All of the banks’ deposit ratings carry a negative outlook. For a full list of affected ratings, please refer to the end of this press release.
Central Asia: Are There Potholes in the New Silk Road? | EurasiaNet.org
When NATO representatives meet with their Afghan and Central Asian counterparts in Istanbul on November 2 to discuss the “New Silk Road” project, they will try to play up its mutual economic benefits. But in order to have any chance of realizing those benefits, plan promoters must address the “rent-seeking” mindset of Central Asian leaders, especially that of Uzbek strongman Islam Karimov.
At the heart of Washington’s Silk Road vision is free trade, or, at least, freer trade. But Uzbekistan, which has emerged as an important Central Asian transit hub, has exhibited in recent years a demonstrable preference for higher trade barriers. Meanwhile, Kazakhstan is casting its lot with a new economic grouping, a Moscow-led customs union known as the Eurasian Economic Community, which, while wanting to eliminate tariffs among participating states, intends to maintain firm trade walls to the outside.
During a stop in the Tajik capital Dushanbe on October 22, Secretary of State Hillary Clinton touted the New Silk Road as “a network of transit and trade connections to open up new markets for raw materials and energy and agricultural products that can be traded among all nations in the region.” For the plan to work, however, Clinton said that “barriers to trade have to come down.”