Jordan Times
Sunday, November 26, 2006
weekly analysis
Amman Stock Exchange
AMMAN — The index of the Amman Stock Exchange
(ASE) fell to its lowest level since the beginning of the year closing last week
at 5631.3 points, down 2.73 per cent from the previous week. The drop, due to
diminishing investor confidence, was in line with other contractions in Arab
bourses. The market capitalisation stood at JD21.5 billion.
According to the World Investment Report for 2006 issued by the United Nations
Conference on Trade and Development, Jordan ranked 19th in an index of 141
countries showing performance in terms of direct investment flow in 2005. Jordan
obtained $1.53 billion last year, and was listed among the countries that have
favourable facilities and abilities to attract these investments.
In other news, the chairman of the Aqaba Development Corporation said ADC will
be licensing offshore banking units in Aqaba after an anti-money laundering law
is passed by parliament, and negotiations in this regard are finalised with the
Central Bank of Jordan.
On the trading floor, the average daily trading volume was down by 24.86 per
cent to JD31.08 million. Overall, decliners outnumbered advancers as 123
companies out of 172 declined, while 39 companies advanced.
The index of the banking sector dropped to 10,956 points at the end of last
week, down by 3.3 per cent from the previous week.
Arab Bank’s share price fell 2.89 per cent finishing the week at JD22.20. The
bank’s shares are trading at a forward P/E multiple of 17x.
Under an agreement signed with the Housing and Urban Development Corporation,
Jordan Ahli Bank will provide credits to those seeking the corporation’s
services and facilities. The bank’s share price, trading at a forward P/E of
11.4x, closed at JD2.65 down by 4.33 per cent.
According to president of the Jordan Insurance Federation, there is more than
one new Islamic insurance company that is going to start operating in the
country. He saw no threat or burden from these firms on existing commercial
insurance companies or the market due to the unique client base that their
operations will target.
Trading-wise, several block deals worth JD2.28 million were executed on around
1.8 million shares of Arab American Takaful Insurance whose share price closed
at JD1.80, up by 3.45 per cent.
In the services sector, the government is expected to resell another one per
cent of its stake in Jordan Telecom to the Joint Investment Telecommunication
Company, a fully-owned subsidiary of France Telecom. The share price of Jordan
Telecom closed at JD4.15, slightly down by 0.72 per cent.
The Telecommunications Regulatory Commission decided to grant a fifth general
telecommunication licence in a step to further liberalise the fixed line
industry.
The Jordan Securities Commission authorised the listing of three million shares
of Arab Investors Union for Real Estate Developing in the second market as of
November 23, 2006. The share price opened at JD1.80, and finished the week at
JD1.71 down by 5 per cent.
The Gulf General Investments, an Emirati company, had recently expressed
interest in raising its equity in Arab Real Estate Development (ARED) by five
million new shares, a move that will increase ARED’s paid up capital to JD25
million. ARED will propose these intentions to its general assembly. The
company’s share closed at JD2.19, down by 9.5 per cent.
In the industrial sector, the share price of Middle East Complex for Engineering
(MECE) closed at JD1.93, down by 2.12 per cent amid active trading that captured
27.13 per cent of the sector’s total trading volume.