UAE bourse regulator okays margin trading

The United Arab Emirates' stock market regulator said on Saturday it had approved regulations authorising margin trading on the Gulf Arab country's stock markets in a move to attract further investments.

The new rules will take effect after co-ordination with the Dubai bourse and the Abu Dhabi securities exchange, the Securities and Commodities Authority (SCA) said in a statement.

This would happen four months after the regulations are published in the official gazette, the statement said.

'This step would win more of the dealers' trust in the market and attract more investments,' the authority's director Abdullah al-Turaifi, said in the statement.
/Reuters/

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Mubasher has been granted an E-trade license by Emirates Securities and Commodities Authority

First major online trading firm to obtain ESCA approval in the UAE.
Direct Broker for Financial Services (Mubasher), the premier provider of e-financial solutions in the region and a subsidiary of the National Technology Group (NTG), has recently announced that it has been granted an E-trade license by Emirates Securities and Commodities Authority (ESCA), becoming the first major firm among over 100 similar brokers to acquire such a license. The E-trade license confirms that Mubasher has met all conditions stipulated by ESCA, particularly in terms of security and real-time information feed.

The E-trade license has also been part of Mubasher's strategy to enhance the company's reputation as the preferred online trading platform in the region. It also provides a significant boost to Mubasher's campaign of promoting online trading and helping clients achieve greater success in their stock and financial trading activities.

"As the region's first and leading stock market information and online trading solutions provider, Mubasher has remained committed to delivering the best quality services and products to all our clients. The seal of approval as a legal entity approved by ESCA validates our status as a quality-oriented organisation, and will give us greater flexibility to further improve the delivery of services to our valued customers in the UAE," said Mohammad Jamal, Sales and Marketing Manager, Mubasher.

A number of factors have been considered by ESCA in granting the E-trade license to Mubasher. These include Mubasher being approved by Getronics Middle East, the leading provider of ICT services and solutions focusing on workspace management, application services and consulting & transformation services; and Mubasher's high degree of scalability to cater to the enormous number of investors.

Other key features of Mubasher are its multirouting ability, which provides multi-channel options to trade and communicate with financial markets; high availability as Mubasher provides ample back-up to all functions and facilities; high security levels that include multilayer password protection; portability through a wide range of access points such as PCs, PDAs, Mobiles and IVRs; and instant pricing feed with real-time price values.

Mubasher also enables Straight Through Processing (STP) for direct trading with source and not through middle agents; has very high standards of data security; allows multilayer authority; and provides full transparency wherein information is delivered to the traders without any form of manipulation. Additionally, Mubasher is also continuing its series of complementary workshops, providing clients free training on all Mubasher investment tools.

Mubasher is the largest online trading company in the Arab World. It was the first to introduce online stock trading in Dubai Financial Market (DFM) and Abu Dhabi Securities Market (ADSM). Mubasher was likewise introduced the UAE's first bilingual (Arabic and English) real-time stock market information service and online trading engine.
/Al Bawaba/

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Controversy: The Ghost Stocks of the Gulf

The Merriam-Webster dictionary defines the word ghost as "a faint shadowy trace” which brings to mind several stocks that are apparently listed on the Gulf stock markets. There are two kinds of ghost stocks in the Gulf, those that are actually listed but whose equity is so tightly controlled by a single family or two therefore are rarely traded if ever and those that are heavily traded but have a faint shadowy presence in real life.

DFM Blues

Of the 61 stocks with a listing on the Dubai Financial Market (on March 4th) 40 of them did not have a single transaction. That works out to be an enormous 65% of the stock market listings that remains dormant. If one looks at the remaining 35% of the market, many of them have one or two digit trades, and that’s in a good day. The question that one needs to ask is, why bother listing these stocks in the first place? According to the resourceful web portal Zawya.com, one major trade-starved bank listed on the DFM, has a 10% share free float, hence it is controlled and managed by one single prominent family. This share does not trade and it oddly didn’t decline in the 2005 UAE stock market crash unlike almost every other stock.

A strange phenomenon has to be that of GCC cross border listings. On this day for example, Gulf Finance House which is listed in Kuwait, Bahrain and Dubai with the promise of an upcoming listing in London (see Gulf News November 2006) didn’t have a single trade. It seems that the hopes of the bank’s CEO of becoming “one of the proactive companies in the DFM” vanished sometime ago.

Another abnormal occurrence must be those firms that most people have never heard of such as the “Aerated Concrete Industries” company (zero trades), one simply known as “Shop” (apparently they have malls, also zero trades) as well as the interestingly named “United Kaipara Dairies” (you guessed it, zero trades). Pundits can recall the UAE Ministry of Economy’s ultimatum concerning the listing of all public joint stock companies two years ago, but couldn’t that be coupled with a minimum amount of shares being held by non founders?

Some companies in Saudi Arabia present the second type of ghost shares as there are several well publicized cases of companies that exist on paper but not much else. A case in point would be a firm known as Bishah Agricultural Development Company which was suspended from trading in early 2007. According to Tadawul, the official Saudi stock market website, Bishah whose nominal value was 10 Riyals was trading at eight times its multiple and millions of Riyals in value just one day prior to its suspension. One could ask what were these poor unfortunate investors, estimated at 10,000 people, buying and selling other than empty promises.

Keep in mind that this is a firm that was valued by investors at $120 Million the day before its suspension and had nothing to its name except three derelict pieces of land “in a good location”. Please read the following line carefully, as the herd mentality of the region manifests itself fully. In February 2006, Bishah, which reported impressive profits to the tune of 206,000 Riyals ($55,000) and turnover of One Million Saudi Riyals in 2005, was valued by investors at a staggering 489 Riyal per share giving this grand daddy of all fiascos an astronomical value of 2.5 Billion Saudi Riyals ($650 Million). Fortunately, the Saudi Arabian Capital Market Authority was quick to react and intervened only one year later to suspend the stock’s trading[4]. These fantastical figures translate into a PE ratio of 13,000 (plus or minus one thousand) meaning that should you be a lucky investor in Bishah you will be able to recoup your hard earned cash in the year 15,000 AD or so; a great stock for those of us looking for long term investment opportunities.

What must be done is some form of fine tuning with regards to the regulations to at least maintain a façade of tackling the issue of equity, market and index manipulation. Illiquid stocks should not be featured in the primary market, nor should they be used in the calculation of the index. Regulators should also be more proactive and react quicker against firms such as Bishah to protect investor’s interest. Introducing market reforms such as the above two will provide investors with a more realistic picture of the available investment opportunities in terms of both, the liquidity and the quality of the listed equities./By Sultan Al Qassimi/

The author is a Sharjah-based businessman and graduate of the American University of Paris. He is also founder of Barjeel Securities in Dubai.

Source

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Dubai leads Gulf bourses higher

Dubai shares led five out of seven Gulf markets higher yesterday, boosted by banks after a positive Goldman Sachs report on the UAE banking sector. Only Doha and Bahrain markets ended in the red.
Deyaar Development’s shares ended up 1.7% to 2.37 dirhams on the Dubai market, itself up 2.3% to 5711.98 at close.

Deyaar’s shares were up ahead of a board meeting yesterday to appoint a new chief executive after its former CEO was jailed and is being investigated for embezzlement. The board was expected to also look into the resignation of two board members. Deyaar shares were down 0.9% on Thursday and have fallen almost 19% this year till date.

Amlak Finance was the top riser, up 7% to 4.91 dirhams, followed by Tamweel, up 6.8% to 8.36 dirhams.

Goldman Sachs in an April 17 report on UAE banks said real estate represents a substantial opportunity for them, adding that Tamweel and Amlak, two large Islamic mortgage finance companies, control around half of the market.

Abu Dhabi market closed up 1.8% to 5000.07, a near 27-month high.
Banks lead UAE markets higher after the Goldman Sachs report said that earnings growth will remain strong in the medium term as banks continue to benefit from an exceptionally supportive economic environment.

The Saudi market closed up 0.3% to 9521.61, after trading lower intraday.
Samba Financial Group rose 0.9% to 82 riyals and Al Rajhi Bank gained 0.3% to 85.25 riyals.
Bellwether Saudi Basic Industries Corp (Sabic), slid 2.9% to 153 riyals, paring overall gains. Sabic said on Saturday its first-quarter net profit rose 10% to 6.92bn riyals from a year earlier on growth in sales.

The Kuwait market closed up 0.1% to 14783.10, led by service sector shares.
The weighted index ended in the red as investors revalued blue chip companies.
Bahrain shares were down 0.4% to 2853.11 at close, undermined by investment firms.
The Muscat stock market closed up 0.4% to 11140.79, led by industrials. (Zawya Dow Jones)

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Shares in Dubai yesterday dropped 0.8 per cent

Shares in Dubai yesterday dropped 0.8 per cent to close at 5,435.95 while those in Abu Dhabi added 0.5 per cent at 4,760.34 points, with Emirates Telecommunications (Etisalat) Corp leading the gains.

Aramex lost 4.2 per cent to Dh2.73 on the Dubai Financial Market (DFM) General Index while International Financial Advisers, a Kuwaiti shareholding company, slumped 7.2 per cent to Dh11.60 and Salam International fell 14.3 per cent to Dh16.20.

Shares value on DFM reached Dh829.4 million compared with the 50-day average of Dh1.53 billion, based on a report by Bloomberg.

Trading values on the Abu Dhabi Securities Market (ADSM) Index amounted to Dh608.9 million compared with the 50-day average of Dh914 million.

Etisalat surged 1.5 per cent to Dh21 as it cut its stake in Etihad Etisalat Co to 26.25 per cent based on an agreement during the creation of its Saudi Arabian unit. The UAE's biggest telephone company had owned a 35-per cent stake in Etihad Etisalat.

National Bank of Abu Dhabi, the second-largest bank in the UAE by assets, advanced 1.3 per cent to Dh19.80 on plans to open its first branch in the Far East. It picked Hong Kong for this year's first expansion to some of the world's fastest-growing markets.

The UAE-based power and oil producer, Abu Dhabi National Energy Co, fell 2.1 per cent to Dh3.19 as it announced plans to invest at least Dh16.8 billion ($4.5 billion) in power stations in Saudi Arabia and North America. The company has said that it will ask shareholders to approve the sale of Dh4.15 billion worth of convertible bonds.

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Slight improvement on the Dubai Financial Market

The Dubai bourse bounced back on Tuesday, adding 0.64 per cent, but Abu Dhabi made it eight losses out of nine.
Tuesday’s slight improvement on the Dubai Financial Market, which closed on 5,671 points, is probably only a temporary respite, with the index continuing to follow a sideways downward pattern of falling for two sessions then rising for one.
“We are still caught in the global dilemma and the question remains whether we can decouple from international markets,” said Chahir Hosni, EFG Hermes sales manager.
“The dollar is weakening and global exchanges will remain bearish for the foreseeable future, so Gulf investors are pulling this money back into the region with cash deposits at local banks increasing. The money is coming back to the Gulf, but it’s not filtering into our equities markets yet.”

The Abu Dhabi Securities Market (ADSM) slipped 0.51 per cent to 4,578 points. It has now dropped 4.93 per cent this month to erase its early-year gains and is now up just 0.58 per cent in 2008. On March 1, this figure was 5.8 per cent.

“Investors are conservative, still spooked by the move of international markets on Monday, though they are trading higher,” Majdi Mansour, Rasmala Brokerage Chief Executive, told Dow Jones.

Analysts are divided over the immediate fate of the UAE markets, with some expecting a limited rebound, while others believe the downtrend will persist for some time to come. “The rebound will continue today or next week, although this will not be very strong and the market will remain in a 400 point range,” said Hosni.

“We are undoubtedly correlated to global markets, because everyone is affected when the US goes bad, but I don’t see this link lasting. I expect the UAE markets to move in a different direction soon.”

Ganesh Mani, a Waves Investments research analyst, said the spreads between buy and sell orders have been increasing, indicating that investors desperate to offload shares are being forced to reduce their asking price.

He said: “We are watching and waiting and I don’t know what it will take for the markets to move away from the global exchanges. Investors don’t know what’s happening. The market is taking its cue from global events in absence of any other news.”

Gainers outnumbered losers five to one on the DFM, with the likes of du, Tamweel and Air Arabia all recouping some of Monday’s losses. The latter was the best performer of this trio, adding 2.06 per cent to close on Dh1.98. Dubai Islamic Bank endured another testing session, falling three per cent to Dh9.99. It has lost 7.3 per cent in March.

Shuaa Capital was a notable loser, dropping 1.55 per cent to Dh8.24, which is 3.9 per cent below its 52-week high of March 11.

Meanwhile, the ADSM fell despite improved volumes as investors continue to book profits in the real estate sector. Aldar and Sorouh slipped 0.5 and 0.9 per cent respectively. Etisalat was the capital’s key loser however, with the ADSM’s largest cap company falling 1.27 per cent to Dh23.40.

There was better news for energy stocks, with Taqa climbing 1.18 per cent, while Aabar added a modest 0.55 per cent.

“The Sunday news that Aldar received approval to increase its capital through a sukuk conversion is still affecting the share,” said Rasmala’s Mansour.

EMAAR MIRRORS RISE

Emaar mirrored Tuesday’s minor increase on the DFM. The property developer climbed 0.88 per cent to Dh11.45 ahead of its annual meeting on Wednesday.
“Investors are hopeful that Emaar will rethink their proposed cash dividends during tomorrow’s annual general meeting to a higher figure,” Majdi Mansour, Rasmala Brokerage chief executive, told Dow Jones. Source

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Iranian Energy Holding plans listing on DIFX

Iran is planning to list shares in a US$90 billion energy holding company on the Dubai International Financial Exchange (DIFX). The main aim of the listing would be to attract international investment to Iran's struggling hydrocarbons sector.
According to the information, the Iranian firm is considering a simultaneous listing on both DIFX and a European exchange in Frankfurt, in addition to listings in Singapore, Hong Kong or Shanghai, to gain exposure to Asian investors.

Quoting Iranian sources, MEED said discussions between the Iranian Privatisation Organisation (IPO) and DIFX about preparing the initial groundwork for the listing are underway.

It remains however unlikely that under the current regional tensions the Iranian listing would obtain the necessary clearance from the Dubai exchange.

Last Wednesday the Bush administration imposed financial sanctions on Bahrain-based Future Bank. The US alleges the bank is controlled by Iran's Bank Melli, which has been accused of providing support to Iran's nuclear program.

The US administration also has accused Iran of taking steps to evade a range of financial sanctions.

Future Bank was established in 2004 as a joint venture between two Iranian state-owned banks — Bank Melli and Bank Saderat — and a private bank based in Bahrain. Bank Melli and Bank Saderat were put on the United States' blacklist last year to have their financial assets frozen.

According to the MEED report one Iranian executive close to the talks says Dubai appears keen to move forward.

"Talks have begun but no formal deals have been signed," says the executive. "There is a preference on Iran's behalf that the Gulf exchange to host the shares will be in Dubai, but if it does not work out they will look elsewhere."

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Dubai bourse drops 1.6pc ending four days of gains

The Dubai bourse yesterday ended four days of gains as it dropped 1.6 per cent to close at 5,866.91, with Aramex retreating the most in three weeks. Shares in Abu Dhabi lost 0.6 per cent at 4,787.39 points, also on concern that slower economic expansion in the US will hurt profit growth in emerging markets.

“Sentiment is being affected by the drop in international markets,” said Mohammed Al Yasin, managing director of Shuaa Securities, in a Bloomberg report. “Still, fundamentals in the region remain strong.”

Aramex, the biggest courier service in the Middle East, dropped 1.6 per cent to Dh3.13 on the Dubai Financial Market General Index. Its chief executive told a local paper of the Dh734.5-million ($200 million) budget for buyouts, and that Aramex is looking at acquiring companies in Asia and the US.

The largest real-estate developer in the Middle East and Africa, Emaar Properties, and Emirates NBD, the biggest bank in the Gulf region, were also big losers with a slump of 2.4 per cent each to Dh12.15 and Dh14.25 respectively.

Dubai Islamic Bank declined 1.2 per cent to Dh12.25. The bank’s subsidiary in Pakistan saw total assets under management grow 152 per cent to Dh1.2 billion (21 billion Pakistani rupees) in 2007. The “enormous expansion” of Dubai Islamic Bank Pakistan makes it one of the fastest growing banks in that country, according to a statement.

The country’s second-biggest publicly traded property developer, Aldar Properties, slipped 5.2 per cent to Dh11, its biggest one-day drop in weeks while UAE’s Finance House was the biggest loser on the Abu Dhabi Securities Market Index with a fall of 6.7 per cent to Dh9.52.

Aabar Energy, a UAE-based oil and gas explorer, gained 1.5 per cent to Dh4.62. It said in a statement yesterday that its Pearl Energy Ltd unit sold a 20 per cent stake in three Thai offshore concessions to Australia’s Horizon Oil Ltd. Source

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Borse Dubai completes Nasdaq deal

Borse Dubai said yesterday it had completed a multi-billion dollar deal with the US exchange Nasdaq in which the emirates-based firm sold its recently-acquired subsidiary, the Nordic and Baltic stock exchange operator OMX, to Nasdaq.

“Borse Dubai has sold 117.228 million shares in OMX, representing approximately 97.2 per cent of the total number of shares and votes in OMX, to Nasdaq,” the company said in a statement.

In return, Borse Dubai has received 42.9 million newly issued shares in Nasdaq and around 1.8 billion dollars in cash, the statement said.

In addition, 17.66 million newly issued Nasdaq shares have been deposited in an independently managed US-based trust for the benefit of Borse Dubai.

The shares held by the trust are eventually expected to be sold out.

“We are pleased to have successfully concluded this landmark deal,” chairman of Borse Dubai Essa Kazim said.

“The completed transactions constitute a key milestone in establishing Dubai as one of the world’s leading financial centres,” he said.

Under the deal, Nasdaq has invested $50 million (33 million euros) by subscribing to newly issued shares in the Dubai International Financial Exchange (DIFX) to become a holder of 33.3 per cent of DIFX outstanding shares, the statement said.

“Nasdaq and Borse Dubai will together develop DIFX as a global exchange which will bridge the US, Europe and the Middle East and further develop and link mature and emerging markets,” said Kazim.

Kazim said in comments published yesterday by Kuwaiti daily Al Qabas that Borse Dubai will own 28 per cent of Nasdaq OMX Group.

But the official announced that Borse Dubai’s holding in the new group would be 19.9 per cent to ensure that its stake does not exceed 20 per cent, in accordance with the US laws.

The remaining 8.1 per cent is the stake placed in the independent trust, the official added.

He said that Borse Dubai saw the agreement as a “strategic deal” that will eventually yield lucrative investment results.

As part of the transactions, Nasdaq, OMX and Borse Dubai have entered into a technology licence and marketing agreement that gives Borse Dubai access to the technology platforms and proprietary systems of Nasdaq OMX group.

Also, Nasdaq and DIFX have entered into a trademark licence agreement that will grant DIFX a licence to use Nasdaq marks in relation to its business in certain territories. Borse Dubai earlier this month acquired more than 97 per cent of OMX shares. Borse Dubai, the holding company for Dubai International Financial Exchange and Dubai Financial Market, is 60 per cent owned by the ICD and 20 per cent each by Dubai Group and DIFC. (AFP)

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DIB, Tamweel lead gains in Dubai

Dubai shares yesterday gained 0.1 per cent to close at 5,931.66, led by Dubai Islamic Bank (DIB) and Tamweel, the UAE's biggest home-finance provider by market value. The Abu Dhabi bourse dropped 0.2 per cent at 4,830.51 points.

DIB, the country's biggest lender complying with Muslim banking rules, rose 3.8 per cent to Dh12.35 while Tamweel advanced 1.8 per cent to Dh6.88 and Arab Insurance Group topped the Dubai measure with a surge of 13.7 per cent to Dh4.15.

Tamweel has won for the third time the Structured Finance Deal of the Year award, presented at the 2008 Islamic Finance News Awards on Tuesday. The recognition was for its $210 million asset-backed securitisation issue, the world's first Shariah-compliant residential mortgage-backed securitisation transaction.

Dropping 1.8 per cent to Dh1.67, Gulf Navigation Holding was one of the biggest losers on the Dubai Financial Market (DFM) General Index. The oil and chemical shipping company rose to its highest close on Tuesday in over a month on plans to allow stock ownership to non-Gulf Arabs.

DFM shares reached 355.5 million with total value amounting to Dh1.8 billion. It saw 9,097 trades from 26 companies, whose losers outnumbered the winners 14 to 10 while the remaining two companies were unchanged.

Emirates Telecommunications Corp, also known as Etisalat, lost one per cent to Dh25.10 while National Corp for Tourism and Hotels was the biggest loser with a fall of 9.7 per cent to Dh9.35.

Etisalat has started training 200 employees from its Nigerian subsidiary, and plans to train 300 more with an aim to enhance their telecommunications skills.

The Nigerian office plans to start operations in the next few weeks.

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Dubai bourse jumps by 2.5pc on real-estate, financial sector gains

Real-estate and financial companies led yesterday's advance in Dubai bourse to 2.5 per cent at 5,866.83 points, bringing the two-day gain to 2.8 per cent. The Abu Dhabi Securities Market (ADSM) Index grew 0.4 per cent to close at 4,744.31, as Sorouh Real Estate Co jumped to a record.

Meanwhile, global marine terminal operator DP World fell 6.4 per cent to $0.88 on the Dubai International Financial Exchange. The Dubai government-owned company dropped 32.2 per cent in 11 weeks since it listed on DIFX at $1.30 a share on November 26.

Emaar Properties jumped 6.6 per cent to Dh12.10 from an opening price of Dh11.45 with shares value amounting to Dh878.4 million. Shares in Emaar surged after HSBC Holdings Plc set a 12-month share-price estimate of Dh23 for the biggest property developer in the Middle East.

HSBC analysts wrote to clients saying that Emaar is "probably one of the most misunderstood and undervalued" $20 billion market-cap companies that they cover globally. "Most of the negative news that we can think of is already in the price," they said.

Banks also gained following an announcement by London-based Societe Generale Asset Management UK Ltd that it is buying financial and property stocks in the Middle East. Dubai's banking sector rose 1.2 per cent to close at 3,611.77 while real-estate sector jumped 4.6 per cent at 11,88.85 and the investment sector advanced 3.3 per cent at 8,696.71.

Kuwait's Global Investment House topped the Dubai Financial Market (DFM) General Index with a jump of 10.3 per cent to Dh15 from Dh13.60 followed by Gulf Finance House, a Bahrain-based financial services company, which increased 8.2 per cent to Dh15.20.

Sorouh, the property developer controlled by the government of Abu Dhabi, jumped 4.2 per cent to close at Dh10.20 after surging 5.7 per cent to Dh10.35 — the highest on record at one time during trading while Fujairah Cement Industries topped ADSM with a gain of 9.8 per cent to Dh5.71.

National Bank of Abu Dhabi, the UAE's second-biggest bank by assets, and Aldar Properties rose 1.3 per cent each to Dh23.20 and Dh11.70 respectively while Waha Capital gained 2.3 per cent to Dh2.72. Waha said that its investments in various sectors would exceed Dh20 billion over the next three years. Source

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DFM rises for fourth day

The Dubai Financial Market (DFM) General Index rose for a fourth day yesterday, adding 0.3 per cent to close at 5,752.35. Shares in the Abu Dhabi Securities Market (ADSM) Index increased 0.2 per cent at 4,785 points.

Analysts say the rally in Saudi Arabia, the region's biggest stock market, helped boost regional markets, including DFM. That country's 300-point push yesterday boosted investor confidence.

The UAE's only publicly traded stock exchange, DFM Co, also advanced for a fourth day on plans to pay a 2007 cash dividend of 10 fils a share. Shares in DFM Co climbed over one per cent to Dh5.96.

DFM Co's board of directors announced on Saturday a proposed cash dividend of 10 per cent of the nominal value of shares, which is equivalent to Dh800 million. The company recorded a net profit of Dh1.44 billion for 2007.

Shuaa Capital, a Dubai-based investment bank covering the Gulf region, advanced 1.8 per cent to Dh6.69 while Arabtec Holding topped DFM with a jump of 5.3 per cent to Dh11.95. Commercial Bank of Dubai grew 4.8 per cent to Dh14.30.

Emirates Integrated Telecommunications Co, also known as du, slumped 1.7 per cent to Dh6.39 from an opening price of Dh6.54. It said yesterday that Emirati nationals now make up 22 per cent of its workforce.

Arkan Building Materials Co and Aabar Petroleum Investments Co paced ADSM, whose shares value amounted to Dh1.6 billion. Arkan gained 5.7 per cent to Dh4.27 while Aabar climbed 0.6 per cent to Dh4.74.

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Borse Dubai completes OMX offer

Borse Dubai said yesterday that it has completed its offer for OMX AB, the Scandinavian and Baltic stock exchange group, and that the acceptance period had been extended

In a statement, Borse Dubai said that shareholders in OMX holding 82,721,185 shares, which represents approximately 68.6 per cent of the total number of shares, had accepted the public offer. It also said that it expected to hold 97.6 per cent of the total number of shares following settlement of its options.

Prior to the offer, Borse Dubai had acquired 5,880,130 shares in OMX, representing approximately 4.9 per cent of the total number of shares and votes in OMX. A wholly owned subsidiary of Borse Dubai had also entered into options to purchase 29,171,741 shares in OMX, representing approximately 24.2 per cent of the total number of shares and votes in the exchange.

The statement said that the options would be exercised on the first business day following the first day of settlement under the offer. And following settlement of the options, Borse Dubai is expected to hold in aggregate 117,773,056 shares in OMX, representing approximately 97.6 per cent of the total number of shares and votes in OMX.

It is anticipated that settlement will occur and proceeds be remitted to shareholders who accepted the offer prior to 11.59 p.m. New York time on February 12, on or about February 19 in relation to Icelandic shareholders, and on or about February 22 in relation to Finnish, Danish and Swedish shareholders, as set out in Borse Dubai's offer document and the supplement to the offer document. Shareholders who have not yet accepted the offer to tender their shares in OMX, Borse Dubai now have until 11.00am New York time (or 5.00pm Swedish time) on February 29 to do so.

The completion of the OMX-Borse Dubai-Nasdaq deal will bring a complex arrangement between the three exchanges to conclusion.

Once Borse Dubai owns at least 67 per cent of OMX shares, it has agreed to transfer all the stock it owns to Nasdaq.

In exchange Borse Dubai will take a minority stake in Nasdaq, along with a cash consideration, and Nasdaq will complete its investment in DIFX.

"We are very pleased to be the first global exchange to bridge the US, Europe and the Middle East and to further develop and link mature and emerging markets through our new combination. Borse Dubai will be the catalyst for regional market development, bridging east and west, and bringing liquidity and development of the region's financial skill base and capabilities," said Borse Dubai chairman, Essa Kazim in a statement.

And vice-chairman of Borse Dubai, Soud Ba'alawy, said: "We want to build a world class, growth oriented exchange in Dubai and other emerging markets including the Middle East, North Africa and South East Asia.

The Borse Dubai/NASDAQ/OMX Group will become the largest global network of exchanges and exchange customers linked by technology in the world." The Swedish Financial Supervisory Authority also said yesterday that the Swedish government had sold all of its 7.99 million shares in OMX, amounting to a 6.6 per cent stake, to Borse Dubai.

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Shares advance for the third day

UAE shares advanced for the third day yesterday on market sentiment that lower borrowing costs will support earnings. The Dubai bourse climbed 0.2 per cent to close at 5,867.47 while shares in Abu Dhabi ended up 0.3 per cent at 4,752.27 points.

Lower interest rates have boosted confidence among traders, analysts say. "Investors are still anticipating good corporate earnings," said a Bloomberg report, quoting Faisal Hasan, head of research at Kuwait's Global Investment House.

The UAE, along with four other Gulf countries, lowered interest rates in line with the US Federal Reserve's move to slash rates aimed at preventing a further recession. Except for Kuwait, the five other Gulf countries have their currencies pegged to the US dollar. The US economy has been in a slowdown due to the recent subprime mortgage crisis.

Zawya Dow Jones reported yesterday that Oman, the last country in the Gulf region to act, cut its repo rate, or the benchmark deposit rate, 0.18 percentage point to 4.14 per cent. With shares value of Dh2.9 billion, the Dubai Financial Market (DFM) General Index advanced for a sixth day. The Abu Dhabi Securities Market (ADSM) Index brought its three-day gain to four per cent.

Emaar Properties, the largest real-estate developer in the Middle East and Africa, rose 0.8 per cent to Dh12.60 while Emirates NBD, which was created following the merger of Emirates Bank International and National Bank of Dubai, grew 1.3 per cent to Dh15.05.

Aramex, a global provider of total transportation and logistics solutions, topped DFM with a jump of four per cent to Dh3.14 from an opening price of Dh2.95 while the Emirates Integrated Telecommunications Co (du) dropped 2.6 per cent to Dh6.48. In Abu Dhabi, Sorouh Real Estate Co advanced 5.2 per cent to Dh9.08, gaining the most since January 23. Its chief executive announced Monday plans to borrow Dh3.67 billion ($1 billion) for domestic projects this year. Source

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Major brokerage firms take larger chunk of trading in UAE

Statistical figures prepared by Abu Dhabi Securities Market (ADSM) and Dubai Financial Market (DFM) have revealed that 20 major brokerage firms together acquire over 61pc of the total market while the remaining 83 brokerage firms registered in UAE share among them the remaining trading market.

The statistical survey also pointed out that the predominating position of the large firms has pushed smaller firms into tough struggle for survival. They are facing a situation of either reduced profits or emerging losses, the figures showed.

The total value of trading by the 20 major brokerage firms stood at approximately AED 228 billion, representing 65pc of all the trading activities in the Abu Dhabi Securities Market, while in Dubai, the value of trading by these firms stood at AED 433.7 billion representing 50.3pc of all the trading at DFM, the figures proved. (WAM)

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UAE stocks' trading value dropped by 45% to Dh14.5b in a week

The value of trades on UAE stock markets dropped last week by 45 per cent to Dh14.5 billion.

Despite the better than expected results posted by some of the leading shares, especially in the banking sector, investors experienced a bumpy ride, as the high volatility, due to conflicting international and domestic economic conditions, was the norm throughout the week.

Market indices ended the week flat, moving within tight margins.

Dubai's benchmark market index advanced 0.24 per cent to 5,615.95, and Abu Dhabi's general index retreated 0.26 per cent to 4,569.40.

Nevertheless, the Dubai Financial Market's shares defied the stagnant conditions, surging 10.5 per cent to Dh5.78, adding Dh4.4 billion to its market value.

The telecommunication sector was also among the gainers on account of Etisalat's 1.3 per cent worth of gains.

Etisalat ended the week at Dh23.60, increasing its market capitalisation by Dh1.5 billion, compared to an extremely volatile performance for du, which ended the week 0.5 per cent down at Dh5.58.

The real estate sector was the worst hit, on account of Emaar Properties plunge of 7.7 per cent to Dh12.00, wiping Dh6.1 billion in market capitalisation.

Aldar Properties' 3.1 per cent worth of gains were not sufficient to lift up the sector's sub-index which dropped 3.5 per cent.

Strong fundamentals

Market analysts agree that the fundamentals still favour a bullish market, regardless of the interruption due to external factors.

"Lower interest rates and excellent corporate performance for 2007 will eventually strike the chord and get the market back on track," cited an Emirates Securities weekly report.

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Stockholm agrees to sell Nordic exchange to Borse Dubai/Nasdaq

The Swedish government said on Thursday it had agreed to sell its 6.6-percent share in the Nordic and Baltic stock exchange operator OMX to Emirates-based Borse Dubai, and subsequently to Nasdaq.

Borse Dubai's proposed cash offer of 265 kronor per share, made jointly with the US high-tech exchange Nasdaq, values OMX at about 32 billion kronor (4.9 billion dollars, 3.47 billion euros).

"I am very pleased that Borse Dubai and Nasdaq have recognised the potential of Stockholm as a financial hub and the importance of the Nordic securities market," Swedish Financial Markets Minister Mats Odell said in a statement.

"Just as importantly, this combination improves opportunities for listed companies and individual investors," he said, adding that the Swedish state would receive 2.1 billion kronor through the sale.

The decision came as no surprise after several regulatory bodies had already cleared the way for the deal and following a ruling by the Swedish parliament last June that the government could sell a long line of public holdings, including in Absolut vodka owner Vin & Sprit, the Nordea banking group and OMX.

The exchange operator is today mainly controlled by Swedish industrial holding company Investor, which owns a 10.7-percent stake, and the Qatar investment authority QIA, which holds a 10-percent share of the company. Source

Once Borse Dubai owns at least 67 percent of the shares of OMX, it has agreed to transfer all the stock it owns to Nasdaq. At the same time, Borse Dubai will make a minority investment in Nasdaq which in turn will take a minority holding in Dubai International Financial Exchange.

Borse Dubai is the holding company for Dubai International Financial Exchange and Dubai Financial Market, while OMX operates exchanges in Copenhagen, Stockholm, Helsinki, Reykjavik, Riga, Tallinn and Vilnius.

Following Thursday's announcement, OMX's stock price was unchanged at 263.50 kronor on the Stockholm stock exchange, which as a whole was down 1.01 percent. Source

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Dubai shares rise

UAE stocks continued to rise yesterday, helped by prospects of further interest rate cuts by the US Federal Reserve. The Dubai bourse rose 39.34 points or 0.7 per cent to close at 5,533.54 while Abu Dhabi's measure added 0.3 per cent at 4,585.40 points.

Since January 15, however, the Dubai Financial Market (DFM) General Index slumped 12 per cent and the Abu Dhabi Securities Market (ADSM) Index, seven per cent, mainly due to the offloading of UAE shares by foreign investors to make up for losses in the global markets, particularly the US.

Most regional currencies have been gaining sharply against the dollar following the Fed's 75-basis point cut in benchmark interest rates last week and expectations of another cut this week. Lower interest rates in the US - which were done to ward off a recession due to the recent subprime mortgage crisis - drive out global investors to higher-yielding assets in emerging markets such as those in the Middle East and Asia.

DFM Co, the Middle East's only publicly traded stock exchange, paced the Dubai measure with shares value of Dh434.9 billion. Its shares rose 3.3 per cent from Dh5.26 to Dh5.37. Dubai Islamic Bank (DIB) also led the measure's advance with a jump of 3.4 per cent from Dh10.30 to Dh10.65. Source

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Gulf shares gain led by Etisalat, DIB

UAE shares rose led by Etisalat and Dubai Islamic Bank, on speculation companies will report higher earnings this week.
PetroRabigh soared after its initial public offering.

Etisalat announces results on January 29. Dubai Islamic Bank, the biggest bank in the country complying with Islamic banking rules, also may report earnings this week, according to Bloomberg data. Companies in the Gulf are benefiting from oil prices above $90 a barrel.

"Investors expect annual earnings of Etisalat and Dubai Islamic to be quite robust, something in the region of 30 and 50 per cent growth respectively,'' Mohamed Dwaikat, a senior broker at Abu Dhabi-based Al Fajer Securities, said in a phone interview yesterday.

"On top of that, Etisalat is quite cheap at the moment." The Abu Dhabi Securities Market Index added 2.2 per cent to close at 4,683.21, bringing the three-day advance to 8.9 per cent. The Dubai Financial Market General Index increased 1.2 per cent, while Saudi Arabia's Tadawul All Share Index climbed 3.8 per cent.

Etisalat jumped 5.2 per cent to Dh24.5. The stock trades at 18 times estimated earnings, according to data compiled by Bloomberg. That compares with an average of 19 for members of Abu Dhabi's benchmark. Etisalat shares have risen 6.3 per cent this year.

DIB added 1.4 per cent to Dh10.95. (Bloomberg)

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Dubai shares soar 10.5pc

UAE shares rebounded yesterday following the US Fed interest rates cut, with the Dubai measure rallying 544.63 points to its biggest one-day gain for years of 10.5 per cent at 5,755.21 and Abu Dhabi's benchmark jumping 272.61 points or 6.3 per cent to close at 4,575.20.


Analysts describe the Fed's move, which was followed by Gulf central banks, as the driving force in bringing investors back into equities. The US reduced the benchmark rate to 3.5 per cent on Tuesday, the first emergency reduction since 2001, to ward off a recession.

"The sell-off was overdone regionally because economies here are robust with very strong growth rates," said Dubai-based Kamran Butt, head of Middle East equity research at Credit Suisse Group, in a Bloomberg report.

The Dubai Financial Market (DFM) Index, whose 1.34 billion shares posted yesterday amounted to Dh6.3 billion, had dropped 17 per cent in the previous five days. It recorded its one of the biggest single-day declines in four years of 6.2 per cent at 5,210.58 on Tuesday.

The UAE reduced the repo rate by three-quarters of a point while Saudi Arabia, the world's biggest oil producer, cut the reverse repurchase rate by half a percentage point and Kuwait trimmed its benchmark lending cost to lessen the appeal of its dinar.

Analysts also say that the UAE and Saudi Arabia do not face serious market risks due to the US economic slowdown, unless the losses spill over to Asia or there is a drop in oil prices. Asian stocks rebounded yesterday from the biggest two-day drop in 18 years while European stocks gained on Tuesday for the first time in six days.

Saudi Arabia's Tadawul All Share Index gained 6.3 per cent to close at 9,922.20 points in Riyadh following a slide of 9.7 per cent on Tuesday, its steepest one-day decline on record.

Emaar Properties, the largest real-estate developer in the Middle East and Africa, rose for the first time in six days with a jump of 11.1 per cent from Dh12.60 to Dh13.55 following a loss of 20 per cent in the previous five days. The company's chairman, Mohamed Alabbar, told the local TV station Al Arabiya that Gulf stock markets would advance this year vis-a-vis the rapid economic growth in the region. Shares in Emaar posted a value of Dh1.87 billion yesterday.

Amlak Finance, the Middle East's largest publicly listed Islamic finance company, and Al Mazaya Holding Co topped DFM with a surge of 15 per cent each from Dh4.36 to Dh4.77 and from Dh7.70 to Dh8.85 respectively.

There were only two losers, namely Grand Real Estate Projects Co with a slump of six per cent to Dh4.60 and Arab Insurance Group, which declined 0.3 per cent to Dh3.23.

Aldar Properties, Abu Dhabi's largest property developer, surged 9.2 per cent to close at Dh10.40 while the Abu Dhabi Aviation Co topped the Abu Dhabi Securities Market (ADSM) Index with a jump of 9.6 per cent to Dh3.55. National Bank of Fujairah was the biggest loser with a fall of 10 per cent to Dh4.76.

The benchmark in Qatar climbed 4.2 per cent to close at 9,533.27 points, after it tumbled to a three-week low of 7.8 per cent on Tuesday. Oman's main index also rose yesterday, as investors brushed off the previous day's losses across global equity markets.

Egypt's benchmark stock index surged over five per cent in early trading following a five-day loss. Source

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