Jordan Times
Monday, December 5, 2005
Primary market issues
hit JD916 million this year
By Khaled Nuaimat and Mahmoud Al Yahya
Amman — The value of shares and bonds issued at
the primary market of the Amman Stock Exchange (ASE) totalled JD916 million this
year, a senior ASE official said Sunday.
According to ASE Chief Executive Officer Jalil Tarif, share issues amounted to
JD482 million followed by treasury bonds at JD400 million and corporation bonds
by JD34 million.
The total this year compares to JD732 million in 2004 and JD614 million in 2003.
Attributing the surge to the growth in the local and foreign investments in
Jordan, Tarif pointed out that “primary market issues contributed to the 113 per
cent growth in the ASE market value this year,”
Noting that primary market issues reflect the healthy investment environment,
the ASE chief stressed that new investments would definitely have a positive
impact on the macroeconomic indicators including inflation rate, unemployment
and poverty.
Tarif highlighted the JD1.1 billion of profits achieved by companies listed on
the first market and indicated that, along with the primary market issues,
profits have lifted the total market value to JD29 billion.
He emphasised that most companies with investment portfolios generated their
profits from core operational business.
“Profits in the industrial sector are mostly operational and do not come as a
result of portfolio investment in the stock exchange market,” explained Tarif.
“However, insurance companies, which represent two per cent of the total market
value, rely on their investment portfolios when generating profits.”
The average daily trading volume at the ASE exceeds JD100 million, reflecting
the depth of the market. As such, Tarif remarked, “the market cannot be
controlled by few investors or funds regardless of their weight in the market.”
Since the beginning of this year, trading volume at the Amman Bourse reached
JD15.7 billion surpassing last year's JD3.2 billion total. Non-Jordanians
accounted for 43 per cent of the total market capitalisation whereas Jordanian
investments stood at 57 per cent.
Tarif announced last week that the ASE has adopted a new pricing scheme for
companies that raise their capital through private placements.
The decision would speed up trading operations as well as preserve the market
liquidity, he said.
He saw the market's trend for next year depending on the current year-end
results of companies.
Asked about future projects, Tarif mentioned ASE's plan for constructing a new
building for the capital market institutions.
He stressed that ASE and the Jordan Securities Commission will continue to
monitor listed companies to ensure corporate governance.
“ASE will revise the current sectors' division for next year operations,” he
concluded.