Jordan Times
Sunday, August 20, 2006
weekly analysis: Amman Stock
Exchange
AMMAN — The Amman Stock Exchange (ASE) index broke the 6000-point barrier at the
beginning of the week. However, selling pressures due to profit-taking
activities resulted in a slight decline of the index by the end of the week.
The ASE index closed at 5977.9 points, up by 0.78 per cent. The market
capitalisation stood at JD22.6 billion.
The United States extended $247.3 million to Jordan with the signing last week
of four grant agreements that represent the US regular economic assistance
package for the fiscal year 2006.
Other news showed that Jordan’s oil bill increased by 24 per cent during the
first half of this year, reaching JD926.2 million compared to JD745 million for
the same period last year.
Domestic exports rose by 13 per cent to JD1,383.9 million during the first six
months of 2006 compared to JD1,224.4 million for the first half of 2005.
At the Amman Bourse, the average daily trading volume increased by 34.5 per cent
to 97.927 million. Overall advancers outnumbered decliners as 87 companies out
of 164 advanced, while 61 companies declined.
A block deal was executed on 312,100 shares of Jordan Steel for a total value of
around JD1.2 million.
The government proposed amending the banking law to allow the participation of
banks in megaprojects by up to 50 per cent of their “regulatory capital”,
instead of the previous 50 per cent of “subscribed capital”.
Bank of Jordan raised its net profit by 19.8% to JD13.3 million during the first
half of this year compared to JD11.1 million during the same period of 2005.
Analysts have upgraded the forecast for the bank’s 2006 net income to JD25.75
million, up by 3.4 per cent from the previous forecast of JD24.91 million which
was based on first quarter results.
The Bank of Jordan stock price closed at JD3. Based on estimates for the bank’s
2006 net income, the shares are trading at a forward P/E multiple of 10.0x.
In the insurance sector, the general assembly of Arab Orient Insurance (AOI)
approved during an extraordinary session an increase in the company’s paid-up-
capital from JD5 million to JD10 million through a private subscription to
shareholders at JD1 per share. AOI’s share price finished the week at JD4.45,
down by 4.3 per cent.
In the services sector, the General Corporation for Housing and Urban
Development signed a memorandum of understanding with the Tameer - Jordan to
build 17,000 housing units, south of Amman, for medium and limited-income people
at a total cost of around $1 billion. Tameer’s share price closed at JD2.86, up
by 6.32 per cent.
The Engineering Union announced its intent to establish a JD100 million real
estate company in order to provide housing units for the local and
limited-income families.
Union Investment Corporation (UIC) is examining the possibility of merging with
another company. UIC is also looking for a non-Jordanian strategic partner that
would add value to the company.
The total trading volume in UIC shares increased by 81.4 per cent last week
reaching around JD28.124 million, compared to JD15.504 million in the previous
week. UIC’s stock price declined by 0.78 per cent closing at JD2.55.
The general assembly of Arab Paper Converting & Trading approved in a
extraordinary session the increase in the company’s paid-up capital from JD5
million to JD25 million, through the allocation of five million to shareholders
and 15 million to strategic Saudi investors.