Beirut SE (1 month)
Current Year High: 3,470.63 Current Year Low: 1,761.53
The Beirut Stock Exchange’s numbers, as tallied by BLOM Bank’s BSI, pointed lower in August. The BSI closed at 1,855 points on August 22, falling back under the 2,000 points line but still up 23.5% from the start of the year. Real estate company and market cap leader Solidere led the market down, dropping 13.43% from the end of July to Aug 22. Analysts pointed to profit taking as reason for the steady index losses throughout the review period. In a bit of a change, headlines on the BSE in August were not entirely dominated by politics. One factor that influenced the market was the recurrence of tales on uneasy merger discussions between Audi Saradar Group and its shareholder, Egyptian investment bank EFG Hermes. According to media reports in London, the Audi Saradar Group issued a statement on August 22 saying that it appointed Georges Achi as chairman after Raymond Audi stepped down because he accepted a post in the government.
Amman SE (1 month)
Current Year High: 5,043.72 Current Year Low: 3,003.07
While the short-term picture for the Amman Stock Exchange index was no better than that for the GCC bourses, the ASE could stay above water when compared with performance of international exchanges since the start of 2008. Closing at 4,186.44 points on August 24, the ASE index lost 9.57% from the end of July but is still almost 14% up from the beginning of the year. Jordan Phosphate Mines and Arab Potash Co, industrial stocks that had been high flying in earlier months on hunger by Arab investors, came crashing with share price losses of 29.6% and 36.9%. Despite these reversions of their fortunes, the two companies ended the review period at share prices that were higher than three and five months ago, respectively. As the ASE authorities noted, share ownership by non-Jordanian investors at the end of July 2008 represented just under 51% of the cumulative market value of all companies on the ASE.
Abu Dhabi SM (1 month)
Current Year High: 5,148.49 Current Year Low: 3,398.33
Nothing permitted the Abu Dhabi Securities Exchange an escape from the August down-drag. At 9.25% loss from July 31 to Aug 24, the ADX general index was less than half a percentage point better off than its sister exchange in Dubai and closed at 4,496.39 points for the last session of the review period. For the third time in 2008, the ADX was in the red at the end of a month when compared with its reading at the start of the year. For every gaining scrip, the ADX saw 4.4 stocks on the losing side. Among sub-indices, insurance lost the least, about 1%, and real estate by far the most, a whopping 16.96%. Of 10 companies that could achieve gains during the review period, five were insurers and two were foreign telecommunications companies. The real estate heavyweights Aldar and Sorouh were twinning at the bottom of the performance record at more than 18% down each, outdone only by a 23.16% drop of Fujairah Building Industries. In plans for increasing its appeal, the ADX intends to introduce derivatives trading toward the end of next year.
Dubai FM (1 month)
Current Year High: 6,291.87 Current Year Low: 4,162.97
As observers attributed the slump in Arab markets on anything from lower oil prices allegedly causing some institutional investors to book share profits in the Gulf for compensation to corruption uncovered in Dubai real estate companies and to having too many shady analysts, investors in the Dubai Financial Market could pick their favorite explanation why they were suffering — but suffer they did with index close at 4,883.15 points August 24, representing a 9.74% loss when compared with the last close in July. Debutant Dar al Takaful was joined only by another insurance company and an investment firm in the positive list while red splashed over almost all other stocks. The real estate sector was shaken by international investment bank Morgan Stanley hinting at the possibility of a weakening Dubai property market by 2010. Then real estate got whacked by new investigations into corruption at developers, some of which were not even publicly traded but tied in with Dubai Holding. Three majors, developer Union Properties, mortgage firm Tamweel, and construction group Arabtec Holding all ended the period more than 23% lower. Market heavyweight Emaar Properties shed 11.43% and closed August 24 at a 52-week low.
Kuwait SE (1 month)
Current Year High: 15,654.80 Current Year Low: 12,039.00
In the first part of August, the Kuwait Stock Exchange was tested by a 553-point slide. Although the middle of the month brought some stabilization to the KSE, the index lost 2.38% by its August 25 close at 14,620.70 points when compared with the last session in July. The industrial index fared best during the period and was able to add 2.64% whereas the non-Kuwaiti stocks sought the bottom with a drop of 7.49%. The runner-up in underperformance was the real estate sector whose sub-index moved 5% lower after being among the KSE’s better bets in the weeks before. By adding more than 54%, Burgan Group, a holding with interests in services, food, and lasting consumer goods, was the best gainer on the KSE. Among companies at the tail end of summertime performance, engineering firm Heisco and, of the non-Kuwaiti stocks, investment bank Shuaa Capital were notable victims of selling pressure with share price losses of at least 20% each.
Saudi Arabia SE (1 month)
Current Year High: 11,895.47 Current Year Low: 7,697.24
Whilst retaining the red lantern in GCC stock market action in 2008, the Saudi Stock Exchange bucked the Gulf markets’ summer slippage trend. With a close at 8,899.27 points on August 24, the TASI added 1.81% from the end of July. The insurance sector, just about the most volatile performer on the SSE in the past 18 months, provided the two strongest gainers with 24% (Tawuniya) and 15.75% (SABB Takaful) in the review period. The banking sector sub-index paced the overall gains of the SSE by adding almost 5%, ahead of the insurance sector’s 3.6%. The bourse’s regulators had important news for the world in August. First, the SSE started applying a new level of disclosure by publishing for each listed company the names and shareholdings of investors whose stakes are larger than 5% — which was seen by some analysts as factor that led to instinctive selling after the new rule was announced in July. In a second step, the Capital Markets Authority allowed foreigners to invest in shares through swaps. This indirect opening to non-resident investors was perceived positively by international analysts who saw it as step toward full market access.
Muscat SM (1 month)
Current Year High: 12,109.10 Current Year Low: 6,641.63
The index graph for the Muscat Securities Market showed the same V-cut in mid-August that afflicted other regional markets. With a 4.57% loss from end of July, the MSM index also was far from doing well in the review period which it closed at 10,245.89 points on August 24. Freshly floated, Sohar Power Company was the market leader with a 28.83% gain since its August 18 listing date. A long distance back in second place with a 9.96% share price leap was The National Detergent Co. — a scrip that, volume-wise, had been rather high on thin suds for the past six months. The banking index, down by 1.66%, scored the least losses in the review period while the services and industrial sub-indices on the MSM ended 7.73% and 10.35% lower. It serves to remember, however, that the latter two indices did well in 2008 to date, with gains of 25% and 28% compared with the start of the year.
Bahrain SE (1 month)
Current Year High: 2,902.68 Current Year Low: 2,520.19
Scarcely a bright day on the Bahrain Stock Exchange, except for two positive sessions on August 13 and 14. The BSE index closed the August 25 session at 2,703.52 points, 3.3% in the red from the end of July. The market thus ended our review period over 200 points down from its year high in mid-June. Banking and services were at the low side of the market with drops of 3.77% and 3.74% but investment stocks did not do much better and only the insurance and hotels & tourism values ended the period nearly unchanged. Gulf Finance House, which had reported $220 million in first-half earnings in late July, was the worst performer and dropped 15.05% between July 31 and August 24, followed by Nass Corporation which shed 8.3%. On the top, Al Baraka Banking Group gained 18%, leading the mere six climbers of August.
Doha SM (1 month)
Current Year High: 12,627.32 Current Year Low: 7,484.19
The bears were sniffing out the peninsular heat of Qatar last month as the Doha Securities Market’s general index erased a good portion of earlier increases and closed at a level it was last at in mid-April: 10,858.60 points on August 24 represented a 6.13% weakening from the end of July. A total of 19 stocks recorded drops of at least 5% over the period, many big names among them, from The Commercial Bank of Qatar (5.58% down) and Industries Qatar (6.57% lower) to United Development Co (minus 12.57%) and Barwa Real Estate (the period’s biggest loser, at minus 17.77%). No sector was spared from the slaughter, although the insurance index was about 3.3 percentage points better than the general index. The top gainer of the period was Qatar Cinema and Film Distribution Co, which added 17.65%. At about rank 43 out of 43 DSM-listed companies by market cap, the company in the entertainment business experienced a solo August rally after announcing 87% higher H1 2008 profit.
Tunis SE (1 month)
Current Year High: 3,252.00 Current Year Low: 2,445.51
The Tunis Stock Exchange spoiled investors with the best performance of regional exchanges in the review period and the Tunindex added a touch above 6% at its close of 3,220.50 points when compared with the July 31 close. Gainers outnumbered losers by almost six to one and the best performance arose from newcomer Poulina Group Holding. The conglomerate with a strong leg in food industries started trading on August 18 and its share price appreciated 40.5% by August 22. Insurance firm Astree was the period’s underperformer; it saw almost 21% of its share price erased.
Casablanca SE (1 month)
Current Year High: 14,925.99 Current Year Low: 11,394.32
The Casablanca Stock Exchange slumbered with a daily average turnover in the review period that was about a third lower than the average daily turnover since the start of 2008. Index developments were downward but modestly so and the bourse’s general index closed at 13,904.43 points on August 22, which constituted a drop of 1.63% from the July 31 close. While losers outnumbered gainers 2 to 1, share price losses were mostly unspectacular when compared with those in other regional markets; only three companies saw their shares drop by more than 10%. Market heavyweight Maroc Telecom reported an 18% increase in first-half profit to $590 million.
Egypt CASE (1 month)
Current Year High: 11,935.67 Current Year Low: 7748.97
After a third straight month of index losses, the Cairo and Alexandria Exchanges have turned into a souk full of presumably great deals, with a price to earnings ratio of 10.4 times that is currently the lowest in the MENA region. One must expect, however, that this attractive status in pricing will offer little consolation to investors who were struck by the Egyptian bourse’s 11.91% negative journey from July 31 to August 24, not to mention the significant share price losses in June and July which added up to a 26.3% drop between the end of May and the market close on August 24. Chores of companies saw their market cap dwindle by half of more during those 12 weeks. On a sordid allegation to the side, the murder of a former Lebanese singer in Dubai was said to have driven down the share price of one major company on CASE, due to rumors that the dastardly crime was instigated by the company’s chairman.
