Market trades improve on good dividend announcements

Trading activities improved on good dividend announcements of some companies, higher prevailing dividend yields and good investments opportunities. Despite that, the MSM30 closed the week down by 0.35 per cent at 4151.97. All key sub-indices ended down led by the Financial Index (-0.79 per cent), then the Industrial Index (-0.42 per cent) and the Services Index (-0.08 per cent). The MSM Shariah Index closed up by 0.31 per cent w-o-w.
Galfar disclosed that it has been awarded a subcontract worth RO 0.753m, bringing the total value of contracts assigned to the company since the beginning of this year to RO 30.2m.
In the weekly technical analysis, according to our last week recommendation that MSM index may support the market or keep it at least within current levels in the short-term. Currently the index will cross up the moving average 10 days the index have a resistance level at 4,200 points and support level at 4,090 points. MACD curve crossed the signal line from the bottom to the top; this movement gives a positive signal to build positions at these levels.
Latest CBO data for conventional banks indicates that the weighted average interest rate spread (lending rate minus deposit rate) on Omani Rial softened by 5bps on year-on year basis (YoY), at 3.488 per cent for the month of Nov’18, as weighted average deposit rate growth slightly outpaced lending rate growth. On month-on-month (MoM) basis, the spread remained flat as both deposit and lending rate increased by 7bps. Weighted average FCY spread rose by 1.1bps in Nov’18 (at 3.885 per cent) over the previous month. The spread is higher by 104.2bps when compared to Nov’17 rate, and has been rising steadily over time. Weighted average interest rate on private sector RO time deposits increased by 5.8bps MoM and declined by 0.3bps YoY, to 3.595 per cent, which is almost the average of 3.55 per cent over Jan-Oct’18. Weighted average interest rate on ALL private sector deposits (RO), however, increased to 1.351 per cent (+0.9bps MoM and +5.4bps YoY) in Nov’18 when compared to an average of 1.288 per cent over Jan-Oct’18.
MSM30 performance in Jan’19 was generally in sync with its historical trend but with more severity in decline which can be attributed to multiple factors such as GCC institutional selling, overall cautious sentiment, selective profit booking and weak annual results of some companies. The index closed down by 3.64 per cent during the month to 4,166.47, one of its lowest levels in more than 14 years. In terms of trading activities, the average daily volumes and values stood at RO 3.3 million and 11.4 million shares respectively, which are weak and reflect cautious sentiment.
Data published by the National Centre for Statistics and Information with respect to major importers of non-oil Omani exports showed that UAE topped the importers during 9M’18 with market share of 19.8 per cent followed by Saudi Arabia (13.2 per cent). Qatar on the other hand, came as key importer for non-oil Omani exports as its share of the total exports went up to 9.6 per cent in 9M’18 from 5.5 per cent in 9M’17. The non-oil Omani exports stood at RO 2.95 billion in 9M’18, up by 25 per cent YoY.
Various news related to development and participation by the private sector were announced during the week. Seeking to build on its success in attracting private investment in the development of its fishery harbours in Taqah (Dhofar Governorate) and Barka (South Al Batinah Governorate), Oman’s Ministry of Agriculture and Fisheries is now offering up four additional fishing ports for investment under the Public-Private-Partnership (PPP) model. Fishery harbours in Liwa and Al Khabourah (North Al Batinah Governorate), Musannah (South Al Batinah Governorate) and Seeb (Muscat Governorate) are now available for development on a PPP basis. Investments in all four fishery ports are estimated in the order of RO 150 million, according to the ministry.
Additionally, government also announced that in 2019, Samayil Industrial City will be officially inaugurated and the development of Phase 7 in Sohar Industrial City will be completed. All such announcement will facilitate in bringing in foreign investment, diversification, increase in public private partnership and increase the job opportunities within the Sultanate.
Bahrain Bourse was the best performer in the previous week as it closed up by 1.92 per cent on weekly basis while Qatar Exchange was the worst as it closed down by 2.01 per cent
Foreign holding in Kuwaiti banks has been on the rise ever since the country was classified as emerging markets by FTSE in 2017 and a potential upgrade of the country by MSCI expected to materialize in 2019. Important capital reforms that led to Kuwait’s inclusion included the segmentation of stocks according to market capitalization and liquidity. More recently, Kuwait started the publication of foreign ownership data for Kuwaiti banks for the first time. This was required by index providers to assess foreign ownership limits. Kuwait bourse started publishing such data in August 2018 and following table illustrates the current foreign ownership within local banks.
The year has started on a very positive note for Saudi Arabia and currently the Saudi market is ranked at the top amongst local as well as various developed markets around the world. Although many sectors have been doing well but the performance of the cement sector has been very exceptional.  (Courtesy: U-Capital)