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Fed easing hopes lift shares; dollar down

Tue, 28 Aug 2012 05:29:02 GMT

Signals from the US Federal Reserve that another dose of stimulus measures could come 'fairly soon' lifted global shares on Thursday and pushed the dollar to a two-month low, outweighing poor economic data from China and Europe.

European shares, which are up over 15 percent since June and have been driving the steady 11.5 percent rise in global stocks, were up 0.16 percent at 0925 GMT. Indexes in London, Frankfurt and Paris were all higher.

US stock futures pointed to a higher open on Wall Street, with futures for the S&P 500, the Dow Jones and the Nasdaq 100 up 0.3 to 0.4 percent.

The euro, which has been boosted in recent weeks by hopes that a new bond buying-led plan being drawn up by the European Central Bank will overcome the currency bloc's debt troubles, was at a seven-week high against the dollar at $1.25726.

Adding to the swirl of speculation about the details of the ECB's plans, central bank sources told Reuters on Thursday that the bank is considering targeting bond yield levels with its purchases, but without making the targets public.

The dollar sank to a two-month low versus a broader basket of currencies. Behind the move was the Federal Reserve's signal on Wednesday that more policy easing is likely to be on the way, a move that will pump more dollars into the financial system.

Minutes from the US central bank's meeting earlier in the month said: 'Many (Fed) members judged that additional monetary accommodation would likely be warranted fairly soon unless incoming information pointed to a substantial and sustainable strengthening in the pace of the economic recovery.'

'The market seems more interested in more prospects of stimulus from the Fed than worries over the euro crisis. In the short term, the market could get back up to the highs which we've seen in the last few weeks,' said Darren Easton, director of trading at London-based Logic Investments.

The Purchasing Managers' Index survey from Markit suggested that the euro zone was destined to return to recession, as the poll notched up a seventh month of contraction.

'In terms of where they are, this is consistent with contraction in euro area GDP,' said Jeavon Lolay, Global Economist, Lloyds Banking Group. 'You could argue it was slightly better than expected, but there isn't much to add.'

Germany confirmed its economy grew at 0.3 percent in the second quarter. Chinese manufacturing PMI data also hit their lowest levels since November as new export orders slumped and the stock of unsold goods rose. - Reuters

Bank, petchem boost Saudi stocks

Tue, 28 Aug 2012 05:29:01 GMT

Saudi shares rose in early trading on Saturday, led by gains in the banking and petrochemical stocks. The all-share added one per cent to reach 7,070 points.

The petrochemical index added 1.3 per cent to 6,163 points. Petrochemical giant Saudi Basic Industries (Sabic) gains 1.6 per cent.

The banking index gained 0.5 per cent to 15,965 points, lifted by gains in heavyweight Al Rajhi Bank which rose 0.7 per cent in early trading.-Reuters

Saudi surges on petchem, banking stocks

Tue, 28 Aug 2012 05:29:00 GMT

Petrochemical and banking stocks lifted the Saudi stock market to close higher on Saturday. The all-share ended 1.4 per cent higher at 7,104 points.

The Kingdom's petrochemical sector also ended 1.4 per cent higher at 6,168 points. Heavyweight Saudi Basic Industries (Sabic) closed 1.4 per cent higher. The banking index ended one per cent higher at 16,016 points.

Earlier in the day, the shares rose led by gains in the banking and petrochemical stocks. The all-share added 1 per cent to 7,070 points and the petrochemical index adds 1.3 percent to 6,163 points.-Reuters

iForex boosts global trading platform

Tue, 28 Aug 2012 05:28:59 GMT

Forex trading platform and financial service provider iForex said it has expanded its list of tradable products by offering the MIB/EUR pairing to its traders.

The MIB is commonly used as the benchmark stock market index for the Borsa Italiana and measures the performance of the 40 major Italian shares, such as Fiat, UniCredit, Campari and MadiaSet.

The clients of iForex can now access this pair as a contract for difference (CFD) alongside other tradable CFDs such as the Dow Jones, CAC 40 and DAX 30.

The recent inclusion of the MIB/EUR pair to iForex’s trading platform offers an excellent opportunity for clients want to transgress from the common market index pairs, said the company which offers its services in a variety of languages including Arabic.

The company said the addition of this pair was beneficial for its clients as it provided the opportunity to take advantage of the constant movements of the MIB as well as diversify one’s trading portfolio.-TradeArabia News Service

Bahrain Bourse to list key $424m sukuk

Thu, 23 Aug 2012 08:52:44 GMT

Bahrain Bourse has announced the listing of a government leasing sukuk (Islamic bond) worth BD160 million ($424 million) which pays an annual fixed rate of return of 4.3 per cent.

The sukuk, issued by the Central Bank of Bahrain on behalf of the Government, has a face value of BD10,000. It is set to mature in five years on July 17, 2017.

It is payable every six months on January 17 and July 17 of the issuance period.

The minimum amount of investment in the sukuk is BD10,000 or multiples thereof.

Following this listing, the number of conventional bonds and sukuk listed on the bourse has reached 10, valued at about $3.21 billion.-TradeArabia News Service

CitiGroup raises Savola share to 'buy'

Thu, 23 Aug 2012 08:52:43 GMT

CitiGroup in its latest equities research report, has raised the price target for Saudi conglomerate Savola to SR48 ($12.8) per share and reiterated its recommendation to buy.

The Savola Group operates in three core sectors: the food Sector which includes edible oils, sugar, and pasta, the retail sector through Al Aziziya Panda supermarkets and hypermarkets, and the plastics sector, which manufactures both rigid and flexible plastic products.

CitiGroup in its report stated that the share price of the consumer conglomerate was up 20 per cent year-to-date versus the Saudi Tadawul up 4 per cent.

The profit and dividend growth as well as rising returns justify this, said the banking giant in its report.

The report notes that Savola’s companies that manage the group’s core sectors are benefiting from rising utilization, successful integration of acquisitions and scale economies.

Returns are rising faster than Citigroup expected when they initiated coverage in January 2011 and Savola management is demonstrating its willingness and ability to extract (and return via special dividends) value from its non-core investments, said the CitiGroup.

The group has a diversified portfolio of strategic investments in which it owns 29.99 per cent of Al-Marai fresh diary company, 49 per cent of Herfy foods & restaurant chain, and 30 per cent of Kinan International real estate.

The Savola Group is also one of the founders of King Abdullah Economic City and Knowledge Economic City in Al-Madinah Al-Munawarah.

Looking at land parcel disposals, the report notes that they generated capital gains in 2011 and special dividends of SR0.3 per share.

More of this should be in store as further land sales crystallize (for example, the agreed sale to KEC which should result in a SR 0.46 per share cap gain in 2012) and as lock ups expire in other parts of the non-core investment portfolio.-TradeArabia News Service

Saudi opens high on petchem stocks

Thu, 23 Aug 2012 08:52:42 GMT

Saudi shares opened higher on Saturday, lifted by gains in the petrochemical sector. The all-share added 0.2 per cent to hit 6,969 points.

The Kingdom's petrochemical index added 0.5 per cent to finish at 6,109 points.

Shares in heavyweight Saudi Basic Industries Corp (Sabic) added 0.6 per cent in early trading.

Shares in Saudi Fertilizers Company (Safco) added 0.5 percent.-Reuters

Arqaam Capital wins top DFM ranking

Thu, 23 Aug 2012 08:52:41 GMT

Arqaam Capital, a specialist emerging markets investment bank, said its brokerage business, Arqaam Securities, has secured the top ranking on the Dubai Financial Market (DFM).

Arqaam pointed out that its brokerage business previously achieved the 12-month average number one position on Nasdaq Dubai for the full year 2011, during which time Arqaam held over 25 per cent of market share.

In July 2012, Arqaam Securities executed Dh617,761,953 worth of trades on the DFM, the company said in a statement.

'This is a great achievement for our equity brokerage team and a testament to their continued efforts to build market share in the UAE. We are focused on building our brokerage platform across Mena and our work in the UAE is the cornerstone of this offering,' remarked Tarek Lotfy, the managing director, Capital Markets.

'We are constantly looking for ways to provide clients with new investment opportunities across Mena and our growing team offers unparalleled insight into those markets. Our efforts have clearly been rewarded by our clients, and we look forward to building on July’s success in the months and years to come,' he added.

Earlier this year, Arqaam acquired the Egyptian brokerage firm, El Rashad Securities Brokerage, said Lotfy.

As part of the agreement, Arqaam purchased El Rashad’s operations and brokerage licence, expanding the Bank’s reach into the Egyptian market, he stated.-TradeArabia News Service

Saudi rises on hospitality, bank stocks

Thu, 23 Aug 2012 08:52:40 GMT

Saudi shares soared on Saturday led by gains in the banking and hospitality sectors to close at 6,987 points. The all-share index added 0.5 per cent.

The banking sector saw a 0.4 per cent rise that took the total to15,912 points.

The hospitality sector gained 5 per cent to close at 7,809.8 points, lifted by gains in Saudi Hotels which closed 6 per cent higher.

Earlier in the day, the shares opened higher lifted by gains in the petrochemical sector. The all-share added 0.2 per cent to hit 6,969 points and the petrochemical index added 0.5 per cent to 6,109 points.-Reuters

Bahrain Bourse to install LED ticker

Thu, 23 Aug 2012 08:52:39 GMT

Bahrain Bourse (BHB) has announced plans to install an outdoor LED ticker on its building's facade which will display live trading activity at the bourse during and after the trading session.

The installation of the 128 sq m full-coloured outdoor LED ticker forms part of the Bourse's efforts to provide more channels for investors in the securities market by allowing them to watch live trading activity and stock prices of securities.

It will enhance disclosure and transparency levels at the bourse in particular and in the capital market in general.

The LED ticker will also increase awareness of trading activity on securities by making it visible to citizens, residents and visitors from the GCC as well as other countries.

The new LED sticker will be on display from October.-TradeArabia News Service

DME celebrates 5 years of growth

Thu, 23 Aug 2012 08:52:38 GMT

Dubai Mercantile Exchange (DME), the premier energy-focused exchange in the Middle East, will be celebrating five years of consistent growth in trading volumes this month, said a senior official.

DME, a joint venture between Dubai Holding, Oman Investment Fund and CME Group, has established itself as the premier international energy futures and commodities exchange in the Middle East since its launch in June 2007.

"Our consistent growth in trading volumes over the last five years – a trend that has accelerated in 2012 – is an indication of the growing importance of Asian demand for oil in the global marketplace," remarked DME chairman Ahmad Sharaf.

This growth in demand drove the need for a credible crude oil benchmark for global oil sales to Asia, and that’s exactly what DME Oman is providing, he stated.

"After five successful years managing DME Oman, the largest physically delivered oil futures contract in the world, the contract has become the world’s third official benchmark for oil trading, alongside West Texas Intermediate (WTI) and Brent," he added.

Recording consistent year-on-year trading growth, DME said in 2012, the trades on exchange crossed the 3 billion barrel mark, with a total of 3.478 million contracts (equaivalent to 3.478 billion barrels) traded on the exchange and annual average daily volumes growing at an annual compounded rate of 31 per cent.

The Oman Crude Oil Futures Contract (DME Oman), the Exchange’s flagship contract, is now the most credible oil benchmark relevant to the Asian market.

According to Sharaf, the volumes for DME Oman have surged in the first half reaching a record 141,129 contracts (141.129 million barrels) in May, posting an increase of nearly 17,967 contracts over the previous record in April of the same year, and an impressive 78 per cent growth over the same period in 2011.

“Operating in a regulated environment, DME provides easy entry into the world’s fastest growing commodities market and the largest crude oil supply/demand corridor in the world," said the top official.

"With enhanced resources, the backing of our shareholders and five years of sustained success behind us, the DME Oman contract and DME are perfectly positioned to go from strength to strength over the next five," he added.-TradeArabia News Service

DFM firms achieves 100pc compliance

Thu, 23 Aug 2012 08:52:38 GMT

Dubai Financial Market (DFM) said its UAE-listed companies have shown a 100 per cent compliance in disclosing their second quarter financial results within the deadline of 45 days from the end of the period.

The total number of UAE public joint stock companies listed on DFM which disclosed their second quarter results reached 43 companies, with the exception of Amlak Finance, as it is already suspended due to procedural reasons, according to a statement from DFM.

The exchange said trading was suspended for seven foreign-listed companies, which didn’t disclose their quarterly statements within the deadline.

These include International Financial Advisors (IFA), Al Madina for Finance & Investment, Hits Telecom Holding, Al Mazaya Holding, Ekttitab Holding, International Investment Group, Acico Industries Company.

DFM said it had submitted a detailed report to the UAE Securities and Commodities Authority including the disclosure dates and its remarks on the disclosures according to SCA requirements.-TradeArabia News Service

Wataniya shares to resume trade Aug 22

Thu, 23 Aug 2012 08:52:37 GMT

Shares in Kuwaiti telco Wataniya will resume trading on August 22, a bourse statement said on Thursday, after Qatar Telecom offered $2.2 billion to buy the remaining shares it does not own in the firm.

Shares in Wataniya have been suspended since late-June, when Qtel, which already controls 52.5 per cent of the firm, said it had lodged an offer for the rest of the company.

Details of the offer - Qtel is offering KD2.6 ($9.19) per share, valuing the outstanding holding at KD622.4 million ($2.2 billion) - were announced on Thursday.

The offer is a 22.6-per cent premium to Wataniya's share price on June 21, the day it lodged the offer with Kuwait's regulator. Based on Wataniya's last traded price of KD2.2 on June 25, the offer represents a premium of 18 per cent.

Shares in Qtel closed up 3.3 percent on the Doha bourse Thursday following announcement of the offer. – Reuters

Wataniya hits 2-month high on Qtel offer

Thu, 23 Aug 2012 08:52:35 GMT

Kuwait's Wataniya rose to a two-month high on Wednesday after Qatar Telecom offered to buy remaining stake in the telco for $2.2 billion, while Gulf markets were mixed in muted trade post Ramadan.

Shares in Wataniya jumped 4.6 per cent to KD2.3 ($8.14) on the Kuwait bourse, their highest close since May 19 as it resumed trading after a two-month hiatus.

Qtel already owns 52.5 percent of the firm and is offering 2.6 dinars per share for the stake.

"Institutions, foreign and local and retail investors, are all keen to make a quick buck on this deal. It will create volume in the market because people making money on the rally will be putting it back in the market," said Fouad Darwish, head of brokerage at Global Investment House.

"We will not feel the full impact of the rally because of the timing... it's the last two days of the week and many people are not in the market."

Kuwait's index rose 0.8 percent, making its fifth straight gain since last week's eight-year low.

In Doha, Qatar Telecom's shares edged up 0.5 per cent, extending gains since it made the Wataniya offer. – Reuters

Gulf IPOs raise over $1 billion in Q2

Tue, 17 Jul 2012 11:35:42 GMT

A total of four initial public offerings (IPOs) raised more than $1 billion on the GCC stock exchanges during the second quarter of this year compared to three IPOs which raised $340 million in the same period last year, a report said.

New listings, although limited to only a few regional exchanges, have helped to soak up some of the excess liquidity in the region and attract investor appetite, according to PwC's latest Capital Markets report.

The average IPO offering value rose to $276 million in the quarter compared to $39 million the first quarter and $133 million in the second quarter of 2011.

The debutants this quarter included Al Tayyar Travel Group, a family business in the travel and tourism sector and Saudi Airline Catering Company, the catering unit of Saudi Airlines, raising $365 million and $354 million on the Saudi stock exchange respectively.

Despite the weak global equity market outlook and falling oil prices, the IPOs received an overwhelming response in the market signifying improving investor confidence.

Other notable issuances during the second quarter included a $227 million IPO by Najran Cement Company also on the Saudi stock exchange and the Bank Nizwa IPO, a newly established Islamic bank in Oman, raising $158 million and which may well pave the way for future IPOs of other start-up Islamic banks on the Muscat Securities Market.

'Whilst IPO activity in the second quarter of the year could be seen to be encouraging, it is still difficult to determine if we are seeing any real recovery,' said PwC Middle East capital markets head Steven Drake.

'With what is happening in the euro zone and the slowing of some of the high growth markets such as China and India, it is difficult to determine the impact this will have on our regional markets.

'We continue to see a strong pipeline in Saudi Arabia and would expect some more companies come to market later in the year as long as share prices remain stable.

'Our outlook for the rest of 2012 is for a continued IPO upward trend in the Saudi Arabian market with perhaps limited to no activity on other regional markets,' he said.

The GCC debt market remained strong during the first half of the year with conventional and Islamic issuances collectively performing better than in the same period last year.

The region's financing needs remain strong due to the heavy infrastructure development plans and refinancing needs to service existing debts, according to the report.

Sukuk continued to outperform conventional bonds in the region this year with Saudi Arabia and UAE being the most active.

'The debt markets in the GCC seem to have remained largely impervious to global economic instability due to continued government support of these issuances,' Drake said.

'Despite fluctuating oil prices and turmoil in other markets, the GCC continues to remain of interest to both regional and international investors looking for exposure to regional fixed instrument securities,' he added. – TradeArabia News Service

UAE banks under pressure as Dubai debt talks falter

Tue, 17 Jul 2012 11:35:41 GMT

The UAE sentiment is seen negative and banks are likely to be hit after Royal Bank of Scotland and two other banks abandoned talks on restructuring Dubai Group's $10 billion debt and threatened legal action, said experts on Tuesday.

The locally-listed banks like Emirates NBD and Abu Dhabi Commercial Bank are said to have significant exposure to this debt.

'This is not good for the local banks especially because most haven't provisioned for Dubai Group's debt exposure,' remarked Ali Adou, portfolio manager at The National Investor.

'These banks already don't have coverage ratio. Most banks have been waiting for the restructuring to go through, to take it from the books as non-performing loans,' he pointed out.

In Saudi Arabia, Banque Saudi Fransi reported a 2-per cent decline in quarterly profits on Monday, missing forecasts, due to higher operational costs.

'The miss is mainly due to provisioning. The loan growth has been fast and they are being conservative. Banks have learned during the crisis to have enough provisioning on the balance sheet in case there are contingent risks,' Adou said.

On Monday, Saudi Arabia shares slid following protests in its oil-producing east.

A downbeat global cue may also weigh on Gulf sentiment. Asian shares eased on Tuesday after Chinese import growth slowed sharply in June, adding to concerns about deteriorating global economic conditions.-Reuters

UAE markets slip, investors wary ahead of Q2

Tue, 17 Jul 2012 11:35:41 GMT

UAE markets slipped on Tuesday, with investor little swayed to buy ahead of second-quarter earnings, while banks were steady despite three international lenders withdrawing from debt restructuring talks with Dubai Group.

Dubai Investments Company was the main drag, falling 2.4 per cent.

Emirates NBD, Dubai's largest bank by market value, slipped 0.4 per cent, while Dubai Islamic Bank added 0.5 per cent.

Royal Bank of Scotland and two other banks have abandoned talks on restructuring Dubai Group's $10 billion debt and threatened legal action, sources told Reuters.

'It was quite surprising seeing such a lack of reaction - bids were soft and not different from the pattern over the last week or so,' said Julian Bruce, EFG-Hermes director of institutional equity sales.

'The majority of investors who are watching events unfold are quite used to small surprises and are happy to stay on sidelines until further developments.'

Dubai's index extended declines for a third day, closing 0.2 per cent lower at 1,488 points. It is down 16.3 per cent from early March's 16-month peak, but is still up 10 per cent year-to-date.

Abu Dhabi's measure closed 0.2 per cent lower at 2,475 points.

'If there is no immediate upside, people will trim positions, hence the weakness. No one wants to put in positions in front of Q2 numbers,' Bruce added.-Reuters

Dubai halts four-day decline, Qatar up

Tue, 17 Jul 2012 11:35:40 GMT

The Dubai bourse halted a four-session decline on Thursday and Qatar's market rose as investors positioned for second-quarter earnings.

Bellwether Emaar Properties led gains, climbing 2 per cent. The builder of the world's tallest tower announced plans for a $500 million seven-year sukuk, with pricing expected on Thursday.

Three analysts forecast Emaar to post an average profit of Dh516 million, a 106.5 per cent jump year-on-year. Contractor Arabtec added 1.4 per cent and telecom operator du rose 1 per cent.

Dubai's index finished 0.7 per cent higher at 1,491 points, halting a four-session loss.

'Volatility on international markets should have translated into weakness but the focus shifted to positioning in favour for good expectations for Q2,' remarked Marwan Shurrab, vice-president and chief trader at Gulfmena Investments.

'People are now preferring to take the risk.' Doha's measure rose 0.5 per cent to 8,285 points, closing higher for a third session in the last five.

Heavyweight Industries Qatar gained 1.8 per cent, Qatar Electricity and Water rose 3.2 per cent and Doha Bank added 1.8 per cent.

The euro hit a fresh two-year low and European shares fell on Thursday as concern over the global growth outlook and disappointment over the prospects for any near-term response by the U.S. Federal Reserve sapped investor appetite.

Elsewhere in Oman, Bank Muscat slumped to a 30-month low as investors sold to avoid subscribing to the lender's rights issue, while Kuwait's index resumes declines in thin trade.

Shares in Bank Muscat fell 1 percent to 0.503 rials, their lowest close since January 2010.-Reuters

Sudan stock market eyes Gulf investors

Tue, 17 Jul 2012 11:35:40 GMT

Sudan expects trading volumes on its small stock market to double this year because of the interest of Gulf investors since it launched computer-based trading, the head of the Khartoum Stock Exchange said.

In January, the Khartoum bourse set up, with Oman's help, an electronic trading system that ended the writing of bond and stock prices on white boards in a stuffy room in the heart of the Sudanese capital.

The new trade system has better linked the bourse, founded in 1995, to Gulf bourses such as Dubai or Muscat.

The Arab African country is developing its stock market to attract more investment to help overcome a severe economic crisis that has triggered protests against high inflation.

Sudan lost most of its oil production when South Sudan became independent a year ago. Oil was the main earner of state revenues and foreign currency needed to fund imports.

Since the start of the computer bourse trading, volumes for shares and bonds have risen to 1.24 billion Sudanese pounds at the end of May, almost double year-on-year, general manager Osman Hamad Khair said.

'We are expecting trading volumes to at least double this year,' he said in an interview, adding that 13 new firms had been listed since the launch of the new trading system, a record number. It had previously around 40 listed firms.

Investors from Gulf countries such as Saudi Arabia and the UAE were increasingly buying into government-issued Islamic bonds, known locally as 'shahamas', as the bourse was now more accessible for outsiders, he said.

He said that Gulf investors now make up around 25 per cent of trading, a number that was on the rise despite Sudan's economic woes with annual inflation hitting 37 per cent in June - more than double the level a year ago.

Khair said risk-willing foreign investors were buying into shahamas, which make up 90 per cent of trading, as the average return was between 18 per cent and 20 per cent, well above bond yields on other markets.

'They (shahamas) are guaranteed by the central bank,' he said.

To reach more investors the stock exchange hopes to soon link trading systems with Cairo and other Arab bourses, Khair said. It already cooperates with UAE bourses in Abu Dhabi and Dubai as well as Muscat.

Most Western investors shun Sudan due to US trade sanctions in place since 1997 over the country's role of hosting prominent Islamists in the past.

Transparency is also a big issue as regulation is only in the early stages. Two new bills to set up an independent bourse supervisor would be hopefully approved by the government and parliament within two months, Khair said.

'The ownership will transfer to a capital markets authority (from the finance ministry),' he said.

Khartoum's stock market is tiny with a market capitalisation of around 8.1 billion Sudanese pounds at the end of May. The biggest Arab bourse, Saudi Arabia, has a capitalisation of more than $300 billion.

Gold Market

In a second expansion step, Sudan hopes to set up next year with the help of India a trading platform for gold due to its rising importance for the economy, Khair said.

To compensate for the loss of oil revenues - following the country's split from oil-rich South Sudan - which previously made up 90 per cent of exports, Sudan wants to expand the production of gold and other minerals as well as agricultural goods.

To encourage trade between local farmers and foreign buyers, Sudan also wants to set up electronic trading platforms for its main agricultural products, such as gum arabic and maize.

Despite Sudan's multiple economic and political woes, with insurgencies in several parts and tensions with South Sudan, Khartoum's main stock index has managed to stay stable this year.-Reuters

Saudi surges on property stocks

Tue, 17 Jul 2012 11:35:39 GMT

Saudi shares ended higher on Saturday, led by gains in the real estate sector as major builder Dar al-Arkan soared in response to news that it was repaying a maturing $1 billion sukuk on July 16.

The all-share index closed 0.6 per cent higher at 6,701 points while the real estate sector ended 3.8 per cent higher.

Dar al-Arkan, which hit a six-month low on Wednesday in heavy trade, rocketed 9.8 per cent in active turnover after it said on Saturday that it has transferred $1 billion to Deutsche Bank to repay the sukuk on Monday.

The news was not a surprise; Dar al-Arkan had said last Monday that it had taken all needed steps to redeem the debt, and market concern over its ability to do so had eased in recent months as the company raised money from land sales.

Nevertheless, some investors appeared to take the latest statement as a cue to buy the stock aggressively at its lows.

Elsewhere, the petrochemical sector closed up 0.2 per cent and the banking index ended 0.5 per cent higher.

Safco shares fell 0.3 per cent after the fertiliser maker posted a 0.8 per cent drop in second-quarter net profit to SR784 million ($209 million), missing analysts' forecasts for a profit of around SR938 million. It blamed maintenance work at some of its units.-Reuters

DGCX wins top commodities exchange award

Tue, 17 Jul 2012 11:35:38 GMT

Dubai Gold and Commodities Exchange (DGCX), the region’s first derivatives exchange, has been named the Best Global Commodities Exchange by the Global Banking & Finance Review.

The award recognises DGCX’s exceptional trade volume expansion and product innovation during the last year.

Gary Anderson, chief executive officer, DGCX, said the global recognition reflects the unique products and strategic initiatives DGCX introduced to support the trading needs of the region.

“We are encouraged by this award as we embark on a new drive to further enhance opportunities in commodity and currency derivatives trading in the region,” he said.

“Coming at a time when there is increasing interest from global futures clearing merchants, global banks and regional financial services firms to participate in the exchange, the award reaffirms DGCX’s growing profile regionally and internationally as an exchange that provides the right investment tools, in the right place at the right time,” Anderson added.

The annual Global Banking and Finance Review Awards recognise achievement, challenge, progress and inspirational change in the global financial industry.

This is the second recognition that DGCX has received in the last three months. The Exchange was also named the Best Middle East Forex Exchange 2012 at the seventh Jordan Forex Expo & Awards (JFEX), held in Jordan in May. – TradeArabia News Service

Gulf market lacklustre as summer lull deepens

Tue, 17 Jul 2012 11:35:37 GMT

Gulf bourses are likely to remain lacklustre on Monday as a summer trading lull, regional political tensions and sustained volatility on global equity and oil markets make investors wary of raising their risk exposure.

Saudi Arabia's index fell for a fifth session in six on Sunday following downbeat earnings from some petrochemical companies. The sector index is at a 26-month low and recent gains in oil prices - seen as a key indicator for petrochemical prices - may not be enough to boost sentiment.

Other Gulf markets have also been in the doldrums and traders say this trend will likely continue.

'It's a combination of reasons - one is that we're still in vacation season, so a lot of the big traders are outside the country and away from the market, especially in Oman and Saudi,' says Adel Nasr, United Securities brokerage manager in Muscat.

'That has really affected volumes and we can't see any obvious direction for the market because of their absence.

'The issues on global markets have yet to be resolved, plus there are political fears over Syria and Iran - it's not just one reason.'

Asian shares are up on Monday as fears of an economic hard landing in China subsided, with Premier Wen Jiabao raising the prospect of more policy stimulus if needed. The market focus is now shifting to the next policy move from the United States and a slew of corporate earnings from U.S. firms this week.-Reuters

Gulf investors cautious, eye US review report

Tue, 17 Jul 2012 11:35:36 GMT

Gulf investors are likely to be cautious on Tuesday ahead of the US Federal Reserve chairman's review on the world's largest economy later in the day.

'This is a season which is dead and when all heads are turned towards Europe and the US,' said a Dubai-based analyst who asked not to be identified.

Asian shares surged and the euro recovered on Tuesday as investors covered short positions and hunted for bargains while awaiting Ben Bernanke's view on the US economy.

National Bank of Oman may see some positive reaction after posting a 13.2 per cent rise in second-quarter profit, edging slightly ahead of analysts' estimates.

Elsewhere, Zain Saudi's $1.6 billion rights issue has so far sold only 54 per cent of shares available, the lead manager said.

Shares in Saudi Arabia's No.3 telecom operator tumbled to a record low on Monday, with Tuesday the last trading day of the rights issue.-Reuters

Saudia catering unit listing on July 9

Mon, 09 Jul 2012 13:16:42 GMT

Saudi Airlines Catering Company will commence trading on the kingdom's stock exchange on July 9, a bourse statement said, after completing a 30-per cent initial public offering which was more than twice covered by investors.

The catering unit of Saudi Arabian Airlines raised SR1.3 billion ($346.7 million) from the share sale, which was sold to the public between June 18 to 24 following a bookbuilding period involving institutional investors.

The sale of shares in the firm, delayed since late 2010 due to issues securing regulatory approval, had been keenly awaited by investors as it is the first part of the Saudi flag carrier, one of the kingdom's largest state-owned entities, to be listed on the stock market.

Saudi Arabian Airlines started a process of privatisation in 2006 by splitting into six units: catering, cargo, maintenance, airlines, flight academy and ground handling. It plans to privatise each unit and offer shares in them to the public.

The ground services unit is expected to be the next to offer shares to the public, according to bankers in the kingdom.

In total, 24.6 million shares priced at 54 riyals were offered in Saudi Airlines Catering Company, with half of each being allocated to retail and institutional investors.

The retail tranche was 2.2-times covered, while the institutional piece saw subscription worth twice the allocation, according to figures from the lead manager, Saudi Fransi Capital - the investment banking arm of Banque Saudi Fransi.

Saudi Hollandi Capital, a unit of Saudi Hollandi Bank , underwrote the offering alongside Saudi Fransi.

Shares in Saudi Airlines Catering Co will be classified under the Agriculture and Food Industries section of the Tadawul index.-Reuters

Private equity deals on the rise in ME

Mon, 09 Jul 2012 13:16:41 GMT

The private equity market in the Middle East is in a very healthy state with deal volumes and values significantly increasing in 2012, said a report.

The private equity (PE) investors are increasingly seeking opportunities in defensive sectors, according to a report by Deloitte.

Education, healthcare, oil and gas services and basic consumer necessities are also amongst the top most sought-after industries in private equities in the GCC, it stated.

“The PE market in the Middle East makes up only a small part of the overall Merger and Acquisition (M&A) marketplace. However, it is in a very healthy state with deal volumes and values significantly increasing in 2012, as compared to previous years,” remarked Richard Clarke, managing director, Transaction & Restructuring Services, Deloitte Middle East.

“The financial crisis has impacted the number of active PE funds in the region, resulting in a reduction in total active firms. Yet, the positive side for PE firms is that there is reduced competition for assets,” he added.

According to the report, many PE firms in region are still in the fund deployment mode, and have not yet entered the harvest phase of their fund cycles.

Deloitte experts believe that early fund investments in the Middle East are entering the market either by way of secondaries, IPOs or trade sales. In addition, findings point to the successful practices of strong PE firms in the region, that have spent the past few years preparing their portfolio companies for sale.

Deloitte experts further indicate that Middle Eastern financial institutions are tightening their lending criteria often to the disadvantage of the growing SMEs.

As such PE firms are and will play an increasingly important role in the development of this SME sector helping to bridge the gap between founder equity and short term borrowings.

“This capital structure gap is ideal for growth capital focused PE funds. It also allows founders to grow their businesses in a controlled way while still retaining equity upside, a flexible structure which the banking community and a large corporate partner may not be able to accommodate,” commented Clarke.

In terms of challenges that the PE market faces in the Middle East, Deloitte experts point to sourcing quality deals, valuation gaps between vendor and acquirer, PE differentiation and aligning with Limited Partner’s expectations.

According to Deloitte experts, the biggest worries for the PE executives are the compliance with Foreign Corrupt Practices Act (FCPA) and the UK Bribery Act.

Both these acts have significant repercussions around the globe, with many corporate clients ensuring their suppliers are in accordance with these acts, they added.-TradeArabia News Service