Friday, March 29, 2024 | Ramadan 18, 1445 H
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EDITOR IN CHIEF- ABDULLAH BIN SALIM AL SHUEILI

MSM30 ends the week down on ex-dividend trades

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The local financial market witnessed pressure last week — which was limited to three trading days due to ‘Al Isra’a Wal Miraj’ holidays, ex-dividends trades, investor cautiousness and investor movements before the end of March.


The MSM30 ended the week down by 1.65 per cent at 3,939.54. The Industrial Index was the only survivor as it went up by 1.39 per cent while both the Services Index and the Financial Index went down by 1.5 per cent and 1.34 per cent respectively. The MSM Shariah Index closed up by 0.62 per cent w-o-w.


During last week, Ubhar Capital SAOC updated its “Ubhar Capital Oman20 Index”. The index witnessed the addition of Ahli Bank and Bank Dhofar and the deletion of Oman Fisheries and Al Jazeera Steel Co. Accordingly, the market cap of this index is about RO 5.11 billion (representing 75.1 per cent of the total market capitalisation at the end of 2018).


In the weekly technical analysis, as mentioned earlier last week, the MSM index crossed down the level of 4,040 points registered the lowest level since 2005. Currently the index will towards the level of the strong support level at 3,800 points in the next period.


Last week, Capital Market Authority of Oman issued detailed guidelines for mandatory health insurance. Some of the salient features of them are:


n The insurance scheme will cover 2 million workers in the private sector and visitors to Oman, including the spouse of the workers and their children.


n The employer is responsible for the payment of the premium.


n The insurance term is one year initially with legal residents of Oman eligible to be included in the policy


n The expenditure limit for the treatment of an inpatient is RO 3,000, including hospital stay, doctors’ fees and diagnosis, medicines, ambulance expenses and patient care.


n The expenditure limit at outpatient clinics is RO 500, the cost of consultation, diagnostics, laboratory and medication fees.


We believe this is a vital project and it will contribute in attracting international private health institutions to invest in the Sultanate and as well as in spreading private healthcare in various governorates across the Sultanate.


With the dividend season almost completing, the performance of MSM30 Index is quite different from MSM total return Index (MSMTR). MSM30 performance is majorly affected because of companies going ex-dividend while MSMTR, depicts the changes in performance constituent companies by reflecting the stock prices along with the reinvestment of cash dividends declared by those companies. The comparison would be fair as both the index constituents are same companies. Overall, MSM30 is down 7.9 per cent till the end of 1Q19 while MSMTR is up 0.6 per cent (MSMTR index base value as of December 31, 2018: 4,166.47).


Imports stood at RO 9.4 billion in 11M’18, up by 2 per cent on annual basis. Key imports in terms of share, came from UAE, China with 13.3 per cent each, then India at 7.0 per cent and US at 6.7 per cent. It is key to note that Oman imports in 2017 stood at RO 10.1 billion and during 2006-2017 CAGR is 9.3 per cent.


Dubai Financial Market topped the gainers up by 5.51 per cent while Muscat Securities Market was the weakest market down by 1.65 per cent.


Foreign inflows and index inclusion has been the story since the start of the year in GCC. Saudi Arabia and Kuwait in particular are two market, which has been riding on this wave and has witnessed sizeable foreign buying this year. Following table illustrate, net foreign buying in five stock exchange across GCC.


Saudi Arabia plans to issue SAR 118 billion ($31.5 billion) in debt this year to help finance the national budget deficit, according to the country’s Debt Management Office (DMO). Saudi Arabia has borrowed extensively over the past few years. At the end of 2018, it had around $150 billion in outstanding government debt, 54 per cent of which was in local currency and the rest denominated in US dollars. By the end of 2019, Saudi Arabia plans to have around $181 billion in outstanding debt, corresponding to 21.7 per cent of gross domestic product. Saudi Arabia’s deficit funding requirements for this year are estimated at $35 billion, which will be funded with an approximate net debt issuance of $31.5 billion, while the rest will come from government deposits at the central bank.


Kuwait’s public works ministry announced last week that it has put out to tender some 125 development projects across the country, as part of its plan for the fiscal year 2019/2020. Some of the salient projects amongst them are: Construction of aircraft parking stands, transport corridors for Kuwait International Airport’s new Terminal 2, new private school complex in Kuwait’s southern commercial hub of Egaila, children’s hospital and a volunteer center in a country known for its philanthropic endeavours etc. Grouping the projects into different categories, 23 of them belong to the healthcare engineering sector, while 51 are classified as maintenance engineering projects, in addition to renovation deals including road repair.


(Courtesy: U-Capital)


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