GCC Equity Market Monitor - 11 June

Transcription

1. GBCM Morning Briefing Contents GCC Equity Markets Monitor MSM Statistics and Indicators MENA , Global markets, Benchmark Indices and Currencies Performance Global Commodities and Petrochemicals Oman News MSM Market Watch Regional News Coverage June 11, 2017 6/11/2017
2. GCC - Equity Market Monitor 20 .0% 15.0% 10.0% 5.0% 0.0% -5.0% -10.0% -15.0% Daily Return Oman -0.4% Saudi -1.2% UAE (DFM) -0.2% UAE (ADX) 0.5% Kuwait - PI -0.5% Kuwait - Wtd 0.0% Qatar 3.0% Bahrain 0.2% YTD Return -7.4% -4.8% -3.7% -1.5% 18.0% 5.3% -11.5% 8.4% MTD Return -1.2% -0.1% 1.8% 1.1% 0.0% -1.0% -6.7% 0.3% QTD Return -3.5% -1.9% -2.3% 0.7% -3.5% -3.2% -11.1% -2.4% Source: Respective Stock Markets, Bloomberg, GBCM Research GBCM Morning Briefing 2
3. MSM - Net Buy /(Sell) Position Top 5 - Turnover Market Share – Previous Week Previous Week Turnover: RO 13.411 million (c. US$ 34.9 million) Figures In RO Value Leaders Sector Turnover (RO) Market Share Raysut Cement Industry 2,041,826 15.22% Ooredoo Services 2,003,972 14.94% Inv Hldg 971,688 7.25% Insurance 928,409 6.92% Services 925,398 6.90% BUY SELL NET 12,193,972 11,014,565 1,179,407 GCC 846,102 411,278 434,824 Gulf Inv Ser Arabs 153,916 92,977 60,938 Al Madina Tak OTHERS 217,055 1,892,225 (1,675,170) OMANIS Omantel MSM - Lead Indicators Value Indicators ** Mkt. Cap (In RO 000s) Daily Market Performance PER (X) P/BV (X) Dividend Yield (%) Indices Monitor Current Closing Previous Closing Daily % MTD % Chg Chg YTD % Chg MSM 30 6,165,854 12.9 1.1 6.0% MSM 30 5,354.77 5,377.17 -0.42% -1.24% -7.40% Financial 3,324,281 8.4 0.9 5.0% Financial 8,005.58 8,028.10 -0.28% -0.69% 4.35% Industrial 897,829 12.8 1.3 5.5% Industrial 7,204.54 7,250.48 -0.63% -1.24% -2.74% Services 2,598,177 60.9 1.7 7.1% Services 2,723.48 2,729.07 -0.20% -1.73% -10.96% MSM Shariah 2,422,290 12.9 1.5 6.8% 787.84 790.29 -0.31% -0.67% -9.34% MSM Shariah 6/11/2017 GBCM Morning Briefing 3
4. MENA Markets Performance Index Global Markets Performance Closing % Chg MENA 13,683.7 0.4 Egypt Jordan Tunis Morocco Palestine Turkey %MTD 2.6 2,161.7 -0.4 -0.6 5,808.2 0.2 1.9 24,491.8 -0.6 1.2 529.7 0.3 0.3 98,942.9 1.0 1.4 MENA Benchmark (S&P/ MSCI) S&P GCC LMC 118.2 0.0 -0.7 S&P GCC (USD) 96.2 0.0 -0.7 985.3 -0.1 -1.6 S&P GCC (40 Index)- Price return S&P GCC (40 Index)- Total return 1,602.9 -0.1 -1.6 MSCI GCC 462.1 0.0 -0.5 MSCI Frontier 564.8 -0.3 0.6 MSCI Frontier ex GCC 876.5 -0.2 1.1 MSCI Arabian Index 505.2 -0.1 -0.4 %QTD %YTD 5.3 -3.9 4.8 2.6 -1.7 11.2 10.8 -0.4 5.8 0.1 -0.1 26.6 -1.8 -2.5 -3.2 -2.3 -2.1 5.2 6.4 -1.7 -2.9 -3.2 -1.8 2.0 -3.1 13.1 16.3 -2.7 Index Closing % Chg Americas S&P 500 Dow Jones Nasdaq Brazil 2,431.8 21,272.0 6,207.9 62,210.6 Index Closing Nikkei Hang Seng Sensex Shanghai Korea Russia % Chg %MTD %QTD %YTD 1,922.8 -0.1 0.6 3.7 9.8 MSCI World -Ex USA 1,882.4 0.0 0.3 5.0 11.3 MSCI Europe- USD 1,678.6 0.0 -0.4 6.9 14.1 MSCI EM Index 1,018.2 -0.1 1.3 6.2 18.1 Dollar Index USD Vs EURO USD Vs Canadian Dollar USD Vs Japanese Yen USD Vs GBP USD Vs Swedish Krona USD Vs Swiss Franc USD Vs Chinese Renminbi USD Vs Hong Kong Dollar USD Vs Indian Rupee USD Vs Aus Dollar USD Vs Indonesia Rupiah USD Vs Turkish Lira Spot USD Vs Omani Riyal USD Vs UAE Dirham USD Vs Saudi Riyal USD Vs Kuwait Dinar USD Vs Qatar Riyal USD Vs Bahrain Dinar Fixed Income (Bloomberg/EFFAS Bond Indices) US 10+ Yr TR 581.9 -0.1 0.2 3.6 5.6 Euro Liquid 10+ Yr TR 231.5 0.1 0.4 1.6 0.1 -3.4 -5.8 Commodity (Bloomberg) Commodity 82.4 0.3 -0.5 Source: Data taken from Bloomberg GBCM Morning Briefing %YTD 0.8 1.3 0.2 -0.8 2.9 2.9 5.0 -4.3 8.6 7.6 15.3 3.3 0.1 0.3 1.6 2.8 3.5 4.1 5.4 9.0 11.6 1.8 1.4 0.4 1.3 1.5 -1.1 5.8 8.0 5.5 -2.0 10.3 -6.5 4.7 18.3 17.4 1.8 17.5 -9.6 Closing % Chg %MTD In Comparison with USD %QTD %YTD -3.1 5.1 -1.1 1.0 1.6 2.9 3.4 1.3 -0.3 0.9 -1.3 0.2 2.8 0.0 0.0 0.0 0.5 -0.4 -0.1 -4.8 6.4 -0.2 6.0 3.3 4.5 5.1 2.2 -0.5 5.7 4.4 1.4 -0.4 0.0 0.0 0.0 0.8 -0.4 -0.1 -0.1 0.4 -1.8 -0.9 Global Currencies Index Global Equity (MSCI) MSCI World – USD %QTD Europe 7,527.3 1.0 5,299.7 0.7 12,815.7 0.8 Asia Pacific 20,013.3 0.5 26,030.3 -0.1 31,262.1 0.2 3,158.4 0.3 2,381.7 0.8 1,041.5 0.3 FTSE 100 CAC 40 DAX Global Benchmark Indices %MTD 4 97.274 1.120 1.347 110.320 1.275 8.715 0.969 6.798 7.797 64.254 0.753 13,291.000 3.537 0.385 3.673 3.751 0.303 3.657 0.377 0.4 -0.2 0.3 -0.3 -1.6 -0.1 -0.2 0.0 0.0 -0.1 -0.3 0.1 -0.4 0.0 0.0 0.0 -0.1 0.0 0.0 0.4 -0.4 0.2 0.4 -1.1 -0.3 -0.2 0.3 -0.1 0.4 1.3 0.2 -0.3 0.0 0.0 0.0 0.0 -0.4 0.0
5. Commodities Performance Index Closing Petrochemical Performance % Chg %MTD %QTD %YTD Index Benzene Aromatics Rotterdam Benzene FOB Korea Spot 765.0 740.0 Benzene CFR Japan Spot Benzene CFR India Spot NYMEX Crude 45.8 0.4 -5.2 -10.9 -19.3 ICE Brent Crude 48.2 0.6 -5.1 -10.8 -18.1 Crude Oil, Oman 47.1 0.4 -5.6 -9.1 -13.1 NYMEX Natural Gas 3.0 0.4 -1.0 -8.4 -15.3 150.2 0.7 -5.9 -10.9 -18.8 Precious Metals Gold Spot 1,266.6 -0.9 -0.2 1.4 9.9 Silver Spot 17.2 -1.4 -0.8 -5.8 8.1 Platinum Spot 940.3 0.3 -1.0 -1.1 4.1 Palladium Spot 856.2 1.1 4.9 7.2 24.9 Base Metals LME Aluminium-Spot 1,901.3 0.1 -1.3 -2.6 11.6 LME Copper-Spot 5,779.5 1.3 2.2 -0.6 4.6 LME Zinc-Spot 2,515.0 2.7 -2.8 -8.6 -1.7 LME Lead-Spot 2,077.3 0.3 -1.0 -10.9 3.9 LME Nickel-Spot 8,924.0 1.9 0.0 -10.4 -10.4 Steel US - Hot Roll Coil Steel 600.0 1.5 4.3 -1.6 -1.3 Agriculture Corn - Active Contract 387.8 0.5 4.2 4.3 6.5 Wheat - Active Contract 445.8 -0.8 3.8 1.5 2.6 CBOT - Soya bean 941.5 0.4 2.8 -1.6 -7.6 Shipping Baltic Dry Index 849.0 3.0 %QTD %YTD -6.1 -2.0 -6.7 -8.1 -10.0 -10.8 745.0 -2.0 -8.0 -10.8 750.0 -2.0 -8.0 -10.7 %MTD Aromatics (in USD/ MT) Energy NYMEX Gasoline Closing -3.3 -34.5 -11.7 Condensates (in USD/ MT) European Naptha 405.7 -6.7 -11.7 -12.4 Naphtha C&F Japan 416.8 -4.5 -11.1 -16.1 Naphtha CIF NWE Cargo 407.3 -5.0 -13.1 -16.2 Naphtha fob Singapore Spot 45.1 -4.6 -11.2 -16.0 Olefins (in USD/ MT) Ethylene Spot 1,125.0 1.4 -5.5 21.6 Ethylene FOB Korea Spot 925.0 -5.6 -15.5 -16.3 Ethylene FOB Japan Spot 920.0 -5.6 -15.6 -16.4 Propylene FOB Korea Spot 855.0 -0.6 2.4 -1.2 8.6 Intermediate (in USD/ MT) 2EH CFR Far East Asia 945.0 -1.1 -8.3 2EH CFR South East Asia 965.0 -1.0 -8.1 8.4 DOP CFR Far East Asia 975.0 -1.0 1.0 -1.0 Polymers (in USD/ MT) LLDPE Future Contract (CNY/ MT) Film Grd Poly HDPE Far E Spot 8,930.0 1,090.0 -2.3 0.0 -2.4 -4.4 -8.6 -6.8 Film Grd Poly HDPE SE Asia 1,120.0 0.9 -3.5 -4.3 Film Grd Poly HDPE India Spot 1,130.0 0.0 -3.4 0.0 Urea (in USD/ MT) Urea Price (RMB/ MT) 1,630.0 0.6 -1.8 5.2 UREA Cornbelt 220.0 -2.2 -12.0 -20.0 UREA Middle East 205.0 -2.4 -3.3 -16.3 US Urea Avg. Retail Price 338.1 -3.6 -8.7 -2.1 Source: Data taken from Bloomberg 6/11/2017 GBCM Morning Briefing 5
6. Oman News Oman Fisheries plans ‘end-to-end’ hub in Muscat (Source: Oman Observer)  Oman Fisheries Co says it plans to establish an integrated fisheries hub at Ghala in Muscat Governorate that will serve as an ‘iconic destination’ for the fisheries industry in Oman and the wider Gulf region.  The ambitious initiative is a key part of the company’s strategy to build on an impressive turnaround in its financial and operational performance that has seen Oman Fisheries turning a profit for the first time after four successive years in the red.  Net profit for the financial year ended March 31, 2017 soared to RO 1.652 million versus a loss of nearly RO 0.455 million posted a year earlier.  “The turnaround has been quite commendable considering the global and regional economic downturn due to oil price volatility, which has affected most of the companies in Oman and also to a great extent the agricultural sector,” commented Oman Fisheries CEO Dr Khalid Mansoor al Zadjali, in a management review of the company’s 2016-2017 performance.  In the review, Dr Al Zadjali outlined his vision for positioning OFC, currently in the final year of a three-year Strategic Growth Plan, for profitability over the long term. Notable is a proposal to develop its Ghala facility into an integrated end-to-end destination for fish processing. The proposed project is part of a raft of initiatives envisaged for “rapid implementation”.  At the same time, OFC is ramping up its processing, refrigeration and storage capacity in line with its growth ambitions. A shuttered plant in Buraimi has been reopened and is slated to come into commercial operation later this month.  Similarly, the warehousing capacity of its wholly owned subsidiary, Al Ameen Refrigeration, is being expanded to 9,000 metric tonnes, up from 6,000 metric tonnes presently. The expanded facility is due to be commissioned next month.  Additionally, the size of the company’s fishing fleet, deployed in the seas off Oman’s southern coast, has been boosted to 13 vessels, he stated. GBCM Morning Briefing 6
7. Oman News Petrofac secures 10-year services agreement from PDO (Source: Oman Observer)  Petrofac has secured a long-term Framework Agreement (FA) with Petroleum Development Oman (PDO) for the provision of Engineering, Procurement and Construction Management (EP+Cm) Support Services for major oil and gas projects.  The agreement, which is for ten years with an additional five-year option, builds upon a three-year programme of EP+Cm support contract delivery Petrofac has undertaken on behalf of PDO.  Future projects undertaken through the FA will be supported by Petrofac’s Muscat office for technical delivery and to ensure sustainable in-country value is generated. OETC raises $500m from international markets (Source: Times of Oman)  Following a successful road show, which covered core fixed income investors in the United States and the United Kingdom, the Oman Electricity Transmission Company (OETC) announced it has raised a $500 million from the international bond market recently.  The bonds are listed on the Irish Stock Exchange and the issuance was managed by OETC and Nama Holding, along with J P Morgan and Bank Muscat; acting as joint bookrunners.  The bonds, which will expire in 2027, are a 10-year Reg S / 144A bond issued at a fixed interest rate of 5.196%. The issuance is rated Baa1 (stable) by Moody’s and BBB (stable) by Fitch.  Given the strong indications of interest received from the market after the initial price thoughts at mid-swap plus 300 bps (basis points), the bond received an oversubscription of eight times, and therefore, the pricing was tightened by 15 bps to Mid-swaps + 285 bps.  At the issuance stage, it was oversubscribed by 6.5 times reflecting a positive market perception for OETC’s credit and Oman Government. GBCM Morning Briefing 7
8. Oman News Bank Sohar successfully raises $250 million syndicated loan (Source: Times of Oman)  Bank Sohar successfully closed a $250 million three-year syndicated term loan facility, in line with current strategies to maintain good credit capacity.  The facility will be used for general funding purposes and to extend maturities of liabilities profile. Acting as the sole bookrunner and coordinating bank is Bahrain-based Bank ABC.  Prior to general syndication, the Abu Dhabi Commercial Bank, Axis Bank Limited and Commerzbank Aktiengesellschaft had joined the facility as initial mandated lead arrangers.  The facility was significantly oversubscribed, with a total of 13 banks participating from the Gulf Cooperation Council (GCC), Europe and Asia. GBCM Morning Briefing 8
9. MSM - Market Watch Source : Bloomberg, GBCM Research Market Outlook – Volatility in the markets to continue… During the last trading week, we saw mixed closing among the GCC markets with the underperformance seen in Qatar and Oman. Saudi, Abu Dhabi and Bahrain closed the week almost flat while DFM closed in a positive territory. We expect the MSM and the regional equities to open on a flat note for the week on volatile oil prices and to see stock specific activity. We recommend investors to stick to the frontline stocks which provides comfort and also anticipate the overall market participation to remain dull. GBCM Morning Briefing 9
10. UAE News UAE hotel industry on a roll (Source: Khaleej Times)  The UAE's hospitality sector is gearing up for one of its busiest periods, with the country's hotel construction pipeline forecast to peak in 2017, and experts noting that the momentum will carry over into 2018.  According to the Ventures GCC Hotel Market Overview, the value of the GCC hotel sector's projects expected to be completed in 2017 is worth $9.51 billion - an increase of $8.24 billion over 2016. The growth is driven by a robust pipeline of hotel construction projects.  The UAE demonstrates the largest market in terms of construction projects lined up for completion, followed by Saudi Arabia and Qatar.  The report found that at $4.05 billion, the UAE is likely to take the lead in expected projects to be completed in 2017, followed by Saudi Arabia at $3.32 billion and Qatar at $1.04 billion.  The UAE's hotel construction pipeline is forecast to peak in 2017 and 2018 as the country gears up for the Expo 2020. Experts forecast 2017 and 2018 to be the busiest years, with 56 project openings in 2017 and 58 openings in 2018.  Dubai and Abu Dhabi will continue to lead in hotel construction across the UAE. In the hotels sector, a further 28,900 rooms are predicted to be delivered in Dubai over the next two years as capacity expands in the run-up to the event.  The hotels market is expected to pick up pace, with three-and four-star hotels likely to compete with the luxury hotel segment. With a slew of new hotel projects, refurbishment of existing structures has gained prominence. DEWA inks $460m power stations deal (Source: Arabian Business)  Dubai's state utility company has signed a AED1.7 billion ($460 million) operating plant service agreement with Siemens to maintain vital power services in the emirate. Dubai Electricity and Water Authority (DEWA) said in a statement that it has signed a 12-year deal with the German company.  The contract includes providing maintenance, spare parts and gas turbine rehabilitation for the second phase of K-Station at Jebel Ali Power and Desalination Station, and the third phase of H-Station at the Al Aweer Power Station.  DEWA also said it has extended the long term maintenance plan for seven more years, for the second phase of L-Station. GBCM Morning Briefing 10
11. GCC News SABIC ’s Ibn Sina POM plant to go operational in Q3 (Source: Argaam)  Saudi Basic Industries Corp.’s (SABIC) Ibn Sina Polyoxymethylene (POM) Project in Jubail Industrial City is expected to launch commercial operations in the third quarter of this year, SABIC said in a statement to Tadawul.  The project’s performance and operational capacity is still being tested, but this will not have any financial impact, the statement said, adding that the impact is expected to show after commercial operation. Zain Saudi acquires additional spectrum for SAR 844 mln (Source: Argaam)  Zain Saudi has acquired 10 megahertz (MHz) of the 1800 MHz spectrum band for SAR 844 million, as per Tadawul discloure. This will increase the company’s spectrum in the 1800 MHz band to 20 MHz.  The first payment of SAR 253 million, representing 30 percent of the total value, will be made this year. The remaining amount will be paid over a 10-year period as annual payments of 7 percent.  The new spectrum will boost Zain Saudi’s LTE network capacity by 50 percent, and would also enhance services’ quality. STC buys additional spectrum for SAR 2.5 bln (Source: Argaam)  Saudi Telecom Co. obtained mobile phone licenses in the 700 megahertz (MHz) and 1800 MHz frequency bands for a total value of SAR 2.51 billion, the telecom operator said in a statement to Tadawul .  STC acquired a 2x15 block in the 700 MHz spectrum band and a 2x8 block in the 1800 MHz band for 15 years, starting Jan. 1, 2018. The company will pay SAR 752 million, or 30 percent of the total value, this year. The rest will be paid in equal installments over ten years, starting from 2019.  The payment will be financed from internal resources, STC said, adding that it is not expected to have a material impact on financial results.  The new spectrum will boost STC’s broadband services and help it improve service quality, the statement added. GBCM Morning Briefing 11
12. GCC News Mobily buys additional spectrum for SAR 422 million (Source: Argaam)  Etihad Etisalat Co. (Mobily) has acquired additional spectrum for SAR 422 million, which will be available to the company available early in 2018, the telco said in a statement to Saudi bourse, Tadawul.  The telco acquired 2x5 MHz block in the 1800 MHz spectrum band in an auction conducted by the Communications and Information Technology Commission (CITC) from May 23, the results of which were announced by the regulator on June 6.  Of the total cost, 30% will be paid in 90 days after the conclusion of the auction. The remainder would be paid in equal annual installments over a 10 year period.  The acquisition, which is expected to boost Mobily’s network capacity and improve customer experience, will be funded from the company’s cash flows and available facilities. Etihad Atheeb acquires additional spectrum for SAR 2.1 bln (Source: Argaam)  Etihad Atheeb Telecommunication Co. (Atheeb Telecom) has acquired additional spectrum for SAR 2.1 billion in an auction conducted by the Communications and Information Technology Commission (CITC), the company said in a statement to Tadawul.  The firm will pay 30%, or SAR 619 million of the total value in 2017, and the remainder would be paid in equal annual installments over a 10-year period. The company will finance the deal through facilities that will be announced later.  Atheeb acquired 2x10 MHz block in the 700 MHz spectrum and 2x10 MHz block in the 1800 MHz spectrum, for 15 years starting Jan. 1, 2018.  The new spectrum is expected to boost the company’s performance, the statement said. Saudi economic growth forecast to slow to 0.6% in 2017 (Source: Arabian Business)  The World Bank said in its June 2017 Global Economic Prospects report that the adverse impact of Organisation of the Petroleum Exporting Countries production cuts on oil exporters outweighs modestly improving conditions in oil importers.  The World Bank said growth in Saudi Arabia is anticipated to ease to 0.6% as a result of the production cuts, before accelerating to a 2% pace in 2018. GBCM Morning Briefing 12
13. | Institutional Sales - Hunaina Banatwala, (+968) 2235 0717 |Institutional Brokerage - Talal Al Balushi, (+968) 2235 0725| | Equity Research - Kanaga Sundar, (+968) 2235 0727 | Vijay Sridharan, (+968) 2235 0728 | Disclaimer: This document has been prepared and issued by Gulf Baader Capital Markets SAOC ("the Company") on the basis of publicly available information, internally developed data and other sources believed to be reliable. While all care has been taken to ensure that the facts stated are accurate and the opinions given are reasonable, neither Gulf Baader Capital Markets SAOC nor any employee shall be in anyway responsible for the contents of this report. The Company may have a position and may perform buying/selling for itself or its clients in any security mentioned in this report. This is not an offer to buy or sell the investments referred therein. 6/11/2017 GBCM Morning Briefing 13