Beirut SE (one month)
Current Year High: 1,629.74 Current Year Low: 715.77
Lebanon’s bourse traded up in February, but only by a hair’s breadth. The BLOM Stock Index closed at 1087.29 points on Feb 20, up 10 and-a-half points from February 2 (but still eight percent lower than at the start of 2009). The Beirut Stock Exchange (BSE) was typically low on action and, mercifully, on volatility. Solidere dipped under $15 in early February — its lowest reading since the middle of the 2006 war with Israel — but the stock retuned smoothly to values around the $16 mark. The center of market attention in mid February was Byblos Bank, which moved to convert almost a fourth of its common stock into Global Depository Receipts (GDR) in order to list them on the London Stock Exchange. Byblos offered share owners one GDR for each 50 shares. The 50-million-share move made Byblos account for over 90 percent of trade volume and value on the BSE in the third week of February. Results-wise, the banking sector sent positive signals in 2008, with the three major banks reporting profit increases of 22 to 23 percent compared with 2007.
Amman SE (one month)
Current Year High: 5,043.72 Current Year Low: 2,561.30
The Amman Stock Exchange index closed its Feb 19 session at 2676.06 points, down by a single percentage point from the last session in January. Volatility reached 9.21 percent; the average price to earnings ratio of Jordanian stocks remained higher than in the GCC markets and stood at 14.80x, according to Zawya. The local unit of Kuwaiti finance firm Global Investment House was cast in unfavorable light for a while as authorities suspended its operations for several days because of a dispute over loan collateral with Jordanian bank HBTF. Arab Bank reported a 2008 net profit of $840 million, increased by 8.4 percent — a good banking performance in a massacre year. UBS and Deutsche Bank would be dancing in ecstasy if they had managed the year with profit contractions in the single digits.
Abu Dhabi SM (one month)
Current Year High: 5,148.49 Current Year Low: 2,136.64
The Abu Dhabi Securities Exchange edged up less than one percent between Jan 29 and Feb 22 and closed on the latter date at 2274.60 points. Energy and construction were the best gainers in the review period, each adding more than 10 percent. The real estate sub-index, however, fell disproportionately with a drop of 14.5 percent on the month; from the start of 2009 to Feb 22, its slide amounted to 39.5 percent whereas the ADX general index contracted 4.8 percent in the same period. In the meantime, the UAE government said it will institute a uniform policy for real estate related residency permits across the UAE, in a step that could help the crucial property market regain some footing. Results are nightmarish for some construction companies but not for reasons one would assume to make sense.
Dubai FM (one month)
Current Year High: 5,960.16 Current Year Low: 1,433.14
No regional market could compete with Dubai in the bad news/good news game in February. The Dow Jones US industrial index could slip to a six-year low even after the bailout plan for the US economy and financial system ballooned into dollar trillions. Not so the Dubai Financial Market, as news of a $20 billion bond program on Feb 22 caused a furious upswing in market optimism and pushed the index to a 7.9 percent gain in a single day on Feb 23 to a close at 1,652.98 points. The day before, profit taking and Emaar’s declaration of seeking Chapter 11 bankruptcy protection for its US unit, John Laing Homes, had weighed the index down and the two sessions before that had been very positive… all in a week’s nervous trading. In the standard review period of Jan 29 to Feb 22 for this month, the DFM index would have shown only an increase of 0.77 percent.
Kuwait SE (one month)
Current Year High: 15,654.80 Current Year Low: 6,444.60
With a general index reading of 6,613.60 points on February 22, the Kuwait Stock Exchange (KSE) at the end of the review period again skated close to beneath the 6,500 year low it had descended to exactly a month earlier. Intra-month gains that allowed the KSE index to briefly cross above the 7,000 points in the first week of February had quickly evaporated and for the second part of the review period, the KSE moved sideways. In terms of sector trends, the market was dragged around in the mud by a troika of investment, real estate, and banking indices. Now, trading in narrow ranges is not necessarily a bad thing for bourses where investors are looking for stabilizing factors. However, crawling sideways in a dark basement with possible hidden sinkholes is not something that will help find the bottom of regional markets. Global Investment House traded in relatively high volumes but at valuations that represent less than 10 percent of the share price it commanded six months ago.
Saudi Arabia SE (one month)
Current Year High: 10,291.47 Current Year Low: 4,264.52
The Saudi Stock Exchange’s TASI shone at some days in February 2009 when it outperformed the other GCC equity markets, but the sum total for the Jan 29 to Feb 22 review period was not as convincing. The TASI closed at 4,713.75 points on Feb 22, less than two percent lower on the month. Some previously oversold stocks in insurance and other sectors moved up by more than 10 percent each, but major names from SABIC to Savola and STC took price beatings in the review period. In terms of sector indices, the spread since the start of 2009 was from 15 percent up for insurance to 13 percent down for construction. So what to make of valuations? Arabian Pipes Company (APC), a staid manufacturer of unspectacular things such as coated steel pipes, was reviewed by Dubai investment banking stars, Shuaa Capital. The analysts in February slashed their nine-month-old fair value estimate of APC by trifling 68 percent but still called the stock a buy because it currently trades at a discount to the new estimate.
Muscat SM (one month)
Current Year High: 12,109.10 Current Year Low: 4,223.63
Oman’s Muscat Securities Market (MSM) dipped fairly low in early February, but the index achieved a slightly rosier close at 4,860.80 on February 22, allowing it to end the review period with a gain of one percent when compared to its last close in January. From the start of 2009, the MSM index is still down by more than 10 percent. The banking and industry sub-indices outperformed the general index in February by eight and five percentage points, respectively, whereas the services index underperformed. It is to be noted, though, that on a longer-term viewing line the services sector was the best bet on the MSM in the past four months. Omantel, which saw a planned sale of a 25 percent stake halted last December because of averse market conditions, saw its fourth quarter 2008 net profit contract by two thirds but announced 25.9 percent higher operational profit for 2008 as well as an expectation of further substantial growth of revenues in 2009.
Bahrain SE (one month)
Current Year High: 2,902.68 Current Year Low: 1,587.56
The Bahrain Stock Exchange (BSE) Index closed at 1,593.32 points on Feb 19, some 62 points lower than at the end of January. Although the third-biggest loser among the GCC securities exchanges in the first eight weeks of 2009, the BSE kept below the radar in February. No big rescue plans for the economy, no bailout plan for banks and the central bank governor said last month that the tiny kingdom’s financial sector is sound. The no-news treatment seemed to work out okay for the exchange — at least reporters weren’t drawing sensationalist attention to the general index’s new low at the end of week eight. The results of the banking sector notwithstanding — Khaleej Commercial Bank ($72.4 million) and Ahli United Bank ($255.7 million) for example, reported earnings in 2008 that represented increases of more than 30 percent for the former and a contraction of less than 20 percent for the latter — banking stocks were at the bottom of market performance.
Doha SM (one month)
Current Year High: 12,627.32 Current Year Low: 4,589.76
The Qatari economy’s primary strength as producer and exporter of natural gas was not reflected in the Doha Securities Market’s (DSM) showing in February 2009. At market close on February 22, the DSM index’s weakening was just 0.1 percent shy of 10 percent when compared with the last close in January. This drop exacerbated the unhappy picture of the DSM as the worst faring GCC market in the early part of the year; by percentage, its loss in the 30 percent range is double what the second-worst performer, the Kuwaiti bourse, gave up. Qatar’s services, industry, and insurance indices did better than the general index and it was the banking index that pulled the market down, underperforming the general index by 3.5 percentage points. Share prices of Qatar Commercial Bank, Qatar Islamic Bank, and Qatar National Bank dropped by 26, 20, and 15 percent, respectively, in the review period.
Tunis SE (one month)
Current Year High: 3,418.13 Current Year Low: 2,649.23
With their confidence in the local securities market, Tunisian share buyers set positive signs in February by elevating the index back above the 3,000 point line. The Tunindex, which had languished beneath that line in December and January, closed at 3,065.1 points on Feb 20, representing a 4.1 percent gain on the month. Saudi-Tunisian JV real estate developer SITS was the strongest gainer and traded up 14.43 percent in the review period. Market cap leader Poulina shed 1.99 percent while leading banking stock Banque de Tunisie climbed 2.79 percent. Results season is less thrilling in Tunisia as many companies follow the mid-year pattern for their annual results.
Casablanca SE (one month)
Current Year High: 14,925.99 Current Year Low: 9,405.86
The Moroccan securities market staged an exercise in optimism and on Feb 20 closed at 10,725.66 points, or 6.3 percent up when compared with the final close of January 2009. Interestingly, share price losses that occurred stayed broadly confined to the single percentage points, but gains of some stocks exceeded 10 percent. The best share price performer of the review period was the real estate firm Groupe Addoha, which appreciated 33 percent. Second and third best gainers in the market were two mid-sized firms by market capitalization: beverage company SBM advanced 30.7 percent and petrochemicals sector company SNEP added 25.2 percent. Leading bank Attijariwafa also did well in the market with a 14.5 percent share price gain.
Egypt CASE (one month)
Current Year High: 11,935.67 Current Year Low: 3,389.31
The Egyptian bourse’s CASE 30 Index closed at 3,528.81 points on Feb 22. The market had dropped to four-year lows on Feb 5 when it closed at 3,389.31. Although the index recovered a bit from this low in the sessions following Feb 5, new selling pressure after Feb 16 contributed to the CASE 30 losing 8.93 percent in the review period. The February 2009 appearance has been the last showing of the CASE 30 Index as Egyptian stock market authorities said the index will no longer be published. It will, however, re-emerge in March as EGX 30, as the Egyptian bourse is completing its six-month long migration from the cumbersome Cairo and Alexandria Exchanges to The Egyptian Exchange (EGX), giving it time to adopt the new name in this column and say goodbye to CASE, in name.
