MIDEAST STOCKS-Kuwait's market surges in strong Gulf, tax fears continue to hit Egypt | Daily Mail Online:
"Share prices in Kuwait jumped in very heavy trade on Sunday, the top performing market in a strong Gulf region, while tax fears continued to weigh on prices in Egypt.
The Kuwaiti market index surged 3.2 percent, its biggest rise in more than two years, to a 23-month high, while trading volume was the biggest since mid-2013. The index is up 15.6 percent so far this year, far outperforming other Gulf bourses. The narrower Kuwait 15 index of blue chips is up 9.6 percent.
The market attracts little non-Arab foreign investment and with a trailing price/earnings ratio near 15 times, it is not cheap compared with its neighbours or emerging markets in general."
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Sunday, 22 January 2017
Shell sells $820m stake in Saudi petrochemicals business
Shell sells $820m stake in Saudi petrochemicals business:
"Royal Dutch Shell has agreed to sell its 50 per cent stake in a Saudi Arabian petrochemicals joint venture for $820m, the latest in a series of disposals aimed at reducing debts and streamlining the Anglo-Dutch group’s sprawling portfolio of assets. The deal will give full control of the business, known as Sadaf, to Shell’s partner, Saudi Basic Industries, the Saudi state-controlled chemicals group known as Sabic. The agreement end a 37-year alliance between Shell and Sabic, during which time Sadaf became the biggest petrochemical complex in the Middle East with combined output of 4m metric tonnes per year from six large plants in the Gulf city of Jubail."
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"Royal Dutch Shell has agreed to sell its 50 per cent stake in a Saudi Arabian petrochemicals joint venture for $820m, the latest in a series of disposals aimed at reducing debts and streamlining the Anglo-Dutch group’s sprawling portfolio of assets. The deal will give full control of the business, known as Sadaf, to Shell’s partner, Saudi Basic Industries, the Saudi state-controlled chemicals group known as Sabic. The agreement end a 37-year alliance between Shell and Sabic, during which time Sadaf became the biggest petrochemical complex in the Middle East with combined output of 4m metric tonnes per year from six large plants in the Gulf city of Jubail."
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UAE set to lead region in economic growth, says NBAD | The National
UAE set to lead region in economic growth, says NBAD | The National:
"The UAE is expected to lead economic growth in the Arabian Gulf this year amid higher spending that will be spurred on by recovering oil prices, according to the latest research from the National Bank of Abu Dhabi (NBAD). While the region is heavily dependent on oil, the UAE has been among the countries in the region that have done a better job of diversifying its economy and coming up with new streams of revenue, according to the bank’s annual global investment outlook. "The UAE Government was the first in the GCC to implement fiscal measures such as subsidy reduction, municipality fee increases and alternative sources to fund government spending," NBAD said."
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"The UAE is expected to lead economic growth in the Arabian Gulf this year amid higher spending that will be spurred on by recovering oil prices, according to the latest research from the National Bank of Abu Dhabi (NBAD). While the region is heavily dependent on oil, the UAE has been among the countries in the region that have done a better job of diversifying its economy and coming up with new streams of revenue, according to the bank’s annual global investment outlook. "The UAE Government was the first in the GCC to implement fiscal measures such as subsidy reduction, municipality fee increases and alternative sources to fund government spending," NBAD said."
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Saudi stock market rally may not be sustainable in 2017 | GulfNews.com
Saudi stock market rally may not be sustainable in 2017 | GulfNews.com:
"The rally in Saudi Arabia’s Tadawul index, which gained 31 per cent last year, is not sustainable, according to National Bank of Abu Dhabi (NBAD). Saudi market is currently trading at a 17 times price to earnings multiple, which is at premium to MSCI emerging market multiple of 15.1 times and also at higher end of its historical average, the bank said in its yearly investment outlook, released Sunday. “We think the current, across the board market rally might not be sustainable in 2017 given the high valuations,” NBAD stated."
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"The rally in Saudi Arabia’s Tadawul index, which gained 31 per cent last year, is not sustainable, according to National Bank of Abu Dhabi (NBAD). Saudi market is currently trading at a 17 times price to earnings multiple, which is at premium to MSCI emerging market multiple of 15.1 times and also at higher end of its historical average, the bank said in its yearly investment outlook, released Sunday. “We think the current, across the board market rally might not be sustainable in 2017 given the high valuations,” NBAD stated."
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Weak Pound Forces Dubai Duty Free to Cut Prices - Bloomberg
Weak Pound Forces Dubai Duty Free to Cut Prices - Bloomberg:
"Dubai Duty Free cut prices after a weaker pound led to lower airport sales and expects to boost revenue by 5 percent this year, driven by spending by Chinese travelers. “We have been negotiating with our suppliers, a lot of whom we pay in dollars,” the airport retailer’s Chief Executive Officer Colm McLoughlin said in an interview on Sunday. “They cooperated very well with us and we’ve been able to correct this business of being perceived as expensive." The government-controlled company, which operates at Dubai International Airport -- the word’s busiest by international traffic, posted a 3 percent drop in sales to $1.85 billion in 2016. The decline was partly due to the pound’s slump versus the dollar in the second half of the year after Britain voted to leave the European Union in June, the CEO said."
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"Dubai Duty Free cut prices after a weaker pound led to lower airport sales and expects to boost revenue by 5 percent this year, driven by spending by Chinese travelers. “We have been negotiating with our suppliers, a lot of whom we pay in dollars,” the airport retailer’s Chief Executive Officer Colm McLoughlin said in an interview on Sunday. “They cooperated very well with us and we’ve been able to correct this business of being perceived as expensive." The government-controlled company, which operates at Dubai International Airport -- the word’s busiest by international traffic, posted a 3 percent drop in sales to $1.85 billion in 2016. The decline was partly due to the pound’s slump versus the dollar in the second half of the year after Britain voted to leave the European Union in June, the CEO said."
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OPEC Shrugs Off Threat of U.S. Cutting Oil Imports - Bloomberg
OPEC Shrugs Off Threat of U.S. Cutting Oil Imports - Bloomberg:
"OPEC’s two biggest suppliers to the U.S. shrugged off a vow by President Donald Trump to end dependence on the group’s oil, saying the world’s biggest economy would continue to need crude from abroad. The U.S. is “closely integrated in the global energy market,” Saudi Arabia’s Energy and Industry Minister Khalid Al-Falih said, while his Venezuelan counterpart Nelson Martinez said he expects his country’s crude exports to the world’s top consumer to remain stable. “The positions that the U.S. and Saudi Arabia take in global energy are very important for global economic stability,” Al-Falih said at a meeting of producing countries in Vienna. He added that Saudi Arabia was looking forward to working with the Trump administration."
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"OPEC’s two biggest suppliers to the U.S. shrugged off a vow by President Donald Trump to end dependence on the group’s oil, saying the world’s biggest economy would continue to need crude from abroad. The U.S. is “closely integrated in the global energy market,” Saudi Arabia’s Energy and Industry Minister Khalid Al-Falih said, while his Venezuelan counterpart Nelson Martinez said he expects his country’s crude exports to the world’s top consumer to remain stable. “The positions that the U.S. and Saudi Arabia take in global energy are very important for global economic stability,” Al-Falih said at a meeting of producing countries in Vienna. He added that Saudi Arabia was looking forward to working with the Trump administration."
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Kuwait Stocks Extend World-Beating Rally Amid Mixed Gulf Markets - Bloomberg
Kuwait Stocks Extend World-Beating Rally Amid Mixed Gulf Markets - Bloomberg:
"Kuwaiti stocks advanced for a 13th day as trading jumped to the highest level in more than three years. Saudi Arabia’s main equity gauge rallied after the nation’s oil minister said output will remain below its OPEC commitment level.
Kuwait’s SE Price Index added 3.2 percent, the most since December 2014, bringing its gain this year to 16 percent, the best performance among more than 90 gauges tracked by Bloomberg globally. With 880 million shares exchanged, volume was the highest in the Middle East.
The rally has been fueled by bets that the Capital Markets Authority and the local bourse will implement steps to boost inflows into an exchange where trading in most companies has lagged."
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"Kuwaiti stocks advanced for a 13th day as trading jumped to the highest level in more than three years. Saudi Arabia’s main equity gauge rallied after the nation’s oil minister said output will remain below its OPEC commitment level.
Kuwait’s SE Price Index added 3.2 percent, the most since December 2014, bringing its gain this year to 16 percent, the best performance among more than 90 gauges tracked by Bloomberg globally. With 880 million shares exchanged, volume was the highest in the Middle East.
The rally has been fueled by bets that the Capital Markets Authority and the local bourse will implement steps to boost inflows into an exchange where trading in most companies has lagged."
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Ipic and Mubadala name board for $125 billion mega merger | The National
Ipic and Mubadala name board for $125 billion mega merger | The National:
"Mubadala Development and International Petroleum Investment Company (Ipic) have named the new board for their US$125 billion merged company, the government announced on Saturday. The chairman of the board of the combined conglomerates will be Sheikh Mohammed bin Zayed, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the Armed Forces, with Sheikh Mansour bin Zayed, Deputy Prime Minister and Minister of Presidential Affairs, as vice chairman. Khaldoon Al Mubarak, the Mubadala chief executive, will be chief executive of the new merged entity, which has been named Mubadala Investment Company, which will be one of the world’s largest strategic investment companies with 68,000 employees."
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"Mubadala Development and International Petroleum Investment Company (Ipic) have named the new board for their US$125 billion merged company, the government announced on Saturday. The chairman of the board of the combined conglomerates will be Sheikh Mohammed bin Zayed, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the Armed Forces, with Sheikh Mansour bin Zayed, Deputy Prime Minister and Minister of Presidential Affairs, as vice chairman. Khaldoon Al Mubarak, the Mubadala chief executive, will be chief executive of the new merged entity, which has been named Mubadala Investment Company, which will be one of the world’s largest strategic investment companies with 68,000 employees."
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Citigroup, HSBC Said Among Banks Mandated for Debut Kuwait Bond - Bloomberg
Citigroup, HSBC Said Among Banks Mandated for Debut Kuwait Bond - Bloomberg:
"Kuwait picked six banks to advise on its first international debt sale as the OPEC member joins other Gulf Arab monarchies shoring up public finances after the slump in oil prices.
Citigroup Inc., JPMorgan Chase & Co. and HSBC Holdings Plc are working as lead managers on the sale, the people said, speaking on condition of anonymity because the information isn’t public. Deutsche Bank AG, Standard Chartered Plc and NBK Capital were also hired as advisers, they said.
Saudi Arabia, Qatar and Abu Dhabi raised more than $30 billion from global bond markets last year to finance their budget deficits. The Kuwaiti government said in July it may raise as much as $10 billion from global debt markets."
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"Kuwait picked six banks to advise on its first international debt sale as the OPEC member joins other Gulf Arab monarchies shoring up public finances after the slump in oil prices.
Citigroup Inc., JPMorgan Chase & Co. and HSBC Holdings Plc are working as lead managers on the sale, the people said, speaking on condition of anonymity because the information isn’t public. Deutsche Bank AG, Standard Chartered Plc and NBK Capital were also hired as advisers, they said.
Saudi Arabia, Qatar and Abu Dhabi raised more than $30 billion from global bond markets last year to finance their budget deficits. The Kuwaiti government said in July it may raise as much as $10 billion from global debt markets."
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Abu Dhabi creates $125 billion fund by merging Mubadala, IPIC | Reuters
Abu Dhabi creates $125 billion fund by merging Mubadala, IPIC | Reuters:
"Abu Dhabi's government merged two of its top investment funds on Saturday to strengthen their financial clout in an era of low oil prices, creating a company with assets totaling about $125 billion. The new fund, Mubadala Investment Co, was formed by merging Mubadala Development Co and International Petroleum Investment Co, which own corporate stakes in the energy industry and other sectors across the world. The new firm's assets will total about $125 billion, based on valuations at the end of 2015, make it the world's 14th largest sovereign fund, according to data from the Sovereign Wealth Fund Institute, which tracks the industry."
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"Abu Dhabi's government merged two of its top investment funds on Saturday to strengthen their financial clout in an era of low oil prices, creating a company with assets totaling about $125 billion. The new fund, Mubadala Investment Co, was formed by merging Mubadala Development Co and International Petroleum Investment Co, which own corporate stakes in the energy industry and other sectors across the world. The new firm's assets will total about $125 billion, based on valuations at the end of 2015, make it the world's 14th largest sovereign fund, according to data from the Sovereign Wealth Fund Institute, which tracks the industry."
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Saudi's SABIC to acquire remaining 50 percent of Shell venture for $820 million | Reuters
Saudi's SABIC to acquire remaining 50 percent of Shell venture for $820 million | Reuters:
"Saudi Basic Industries Corp (SABIC) 2010.SE has signed an agreement to acquire the 50 percent that it does not already own in its petrochemical venture with Shell Arabia, a unit of Royal Dutch Shell (RDSa.L), for $820 million, SABIC said on Sunday.
"As per the partnership agreement between the two companies that stipulates the right of SABIC to renew or end the partnership by the end of 2020...SABIC decided to acquire the full stake of Shell, which is 50 percent," it said.
SABIC, one of the world's largest petrochemical firms, said the $820 million figure was based on the net value of the venture's assets. It said the acquisition was in line with a strategy to develop its successful investments.
"
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"Saudi Basic Industries Corp (SABIC) 2010.SE has signed an agreement to acquire the 50 percent that it does not already own in its petrochemical venture with Shell Arabia, a unit of Royal Dutch Shell (RDSa.L), for $820 million, SABIC said on Sunday.
"As per the partnership agreement between the two companies that stipulates the right of SABIC to renew or end the partnership by the end of 2020...SABIC decided to acquire the full stake of Shell, which is 50 percent," it said.
SABIC, one of the world's largest petrochemical firms, said the $820 million figure was based on the net value of the venture's assets. It said the acquisition was in line with a strategy to develop its successful investments.
"
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MIDEAST STOCKS-Earnings drag down Saudi, tax fears continue to weigh on Egypt | Reuters
MIDEAST STOCKS-Earnings drag down Saudi, tax fears continue to weigh on Egypt | Reuters:
"Weak fourth-quarter earnings at several major Saudi Arabian companies dragged down that market on Sunday, while most other Gulf bourses were firm. Tax fears continued to weigh on Egypt. The Saudi index dropped 0.4 percent as food maker Savola plunged 6.2 percent. It swung to net loss of 964.3 million riyals ($257.2 million) in the quarter from a profit of 515.3 million riyals a year ago, and said it did not plan to pay quarterly dividends in 2017. Analysts polled by Reuters had on average forecast Savola would make a quarterly profit of 53.6 million riyals."
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"Weak fourth-quarter earnings at several major Saudi Arabian companies dragged down that market on Sunday, while most other Gulf bourses were firm. Tax fears continued to weigh on Egypt. The Saudi index dropped 0.4 percent as food maker Savola plunged 6.2 percent. It swung to net loss of 964.3 million riyals ($257.2 million) in the quarter from a profit of 515.3 million riyals a year ago, and said it did not plan to pay quarterly dividends in 2017. Analysts polled by Reuters had on average forecast Savola would make a quarterly profit of 53.6 million riyals."
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