08/08/2016
08/08/2016
KUWAIT CITY, Aug 7: Kuwait Financial Centre “Markaz” recently released its Monthly Market Research report. In this report, Markaz examines and analyzes the performance of equity markets in the MENA region as well as the global equity markets for the month of July. The report stated that July was a marginally positive month for the MENA indices, with most markets ending the month in green, as positive quarterly earnings led to increased investor activity. Markets in Egypt (13.1 percent), Qatar (7.3 percent) and Dubai (5.2 percent) performed well, while Saudi’s TASI (-3.0 percent) and Kuwait weighted (-0.2 percent) indices lagged behind.
The negative performance of the largest GCC market led to flat performance of S&P GCC index. Other indices witnessed slight rise in index values, despite the steepest monthly fall in oil prices in 2016. Egypt HRMS index rose in the last week of the month, as the country’s plan to secure a US$ 12bn loan from the International Monetary Fund (IMF) was close to fruition. The loan is being sought to ease a crippling dollar squeeze, and restore confidence in the economy, and would be the fund’s biggest aid package in a region that has been pummeled by political unrest and oil price fall. The report added that blue chips drove Qatar’s index surge, with real estate (8.52 percent), telecoms (7.94 percent) and banking stocks (7.1 percent) performing well in July.
The recently announced Qatar’s fuel subsidy reform will also help shrink its budget deficit by reducing expenditures; a move that will help investments in private sector. Saudi index fell due to fall in oil price, and the continued resilience of shale oil, as increasingly efficient US shale production continues to drive a wedge in OPEC’s strategy of flooding the market with excess crude.
Blue Chips had a mixed July, with Emaar Properties (UAE) and Ezdan Holdings (Qatar) ending the month at the top, gaining 10 percent and 9.6 percent, respectively. National Commercial Bank (Saudi Arabia) and First Gulf Bank (UAE) witnessed a slump, losing 6.0 percent and 4.4 percent, respectively. Positive Q2 results contributed to improved market performance for most companies in the region, as investors returned to the markets post Ramadan. Dubai’s Emaar Properties reported a 8 percent rise in Q2 net profit, as strong investor demand led to higher revenue recognition.
Ezdan Holdings half-yearly profit went up 8 percent, driven by rise in operations. Despite posting a profit of 3.2 percent in Q2, shares of National Commercial Bank declined the most in July, as the bank proposed a lower dividend for the first half of the year, as compared to the previous year. Q2 profits of First Gulf Bank slipped 10 percent, meeting analyst estimates, while the merger between FGB and National Bank of Abu Dhabi was confirmed early in July.
Rise in Debt issuance
Fall in Real Estate transactions
Oil Market Review