MSM30: Best weekly per­for­mance

Oman Daily Observer - - INSIDEOMAN -

The MSM30 in­dex posted its best per­for­mance since late March 2016 due to in­creased lo­cal in­sti­tu­tional sup­port to lead­ing stocks such as tele­coms and some banks in ad­di­tion to the strate­gic moves of the fund man­agers ahead of year-end. MSM30 closed the week up by 3.1 per cent at 4,548.72. All subindices closed up led by the Fi­nan­cial In­dex (2.81 per cent) fol­lowed by the In­dus­trial In­dex (1.49 per cent) and then the Ser­vices In­dex (1.17 per cent). The MSM Shariah In­dex also closed up by 2.57 per cent w-o-w.

Gal­far En­gi­neer­ing and Con­tract­ing Co said that it has en­tered into a con­tract worth RO 5.37 mil­lion re­lated to some work at Duqm from Saipem SPA, Oman. The par­ent com­pany’s or­der book at the end of 9M’18 stood at RO 456 mil­lion. The group’s net profit for 9M’18 was RO 2.24 mil­lion com­pared with a net loss of RO 3.76 mil­lion dur­ing the same pe­riod last year.

Ray­sut Ce­ment dis­closed on MSM that it has been awarded a con­tract re­lated to in­stal­la­tion of Waste Heat Re­cov­ery Sys­tem that will use the cur­rently wasted heat to gen­er­ate 9MW of power. The project is ex­pected to take at least 18 months to be com­pleted. As per var­i­ous me­dia sources, the com­pany ex­pects to save up to 30 per cent of its power cost upon com­ple­tion of this project. Such sav­ing is no­table tak­ing into ac­count that the cost of fuel, gas and elec­tric­ity to the rev­enue is about 34 per cent.

Fur­ther­more, Ray­sut Ce­ment dis­closed on the MSM web­site about the news cir­cu­lated in sev­eral lo­cal and in­ter­na­tional me­dia re­gard­ing the ex­pan­sion plans of the com­pany. The com­pany dis­closed that such plans are at a pre­ma­ture stage pend­ing board ap­proval. Dur­ing the week, many news sources have in­di­cated that Ray­sut is in the process of in­vest­ing hun­dreds of mil­lions of dol­lars in ac­qui­si­tions in In­dia and Africa.

Sim­i­larly, Oman Ce­ment dis­closed that its board of di­rec­tors has agreed to set up a new in­te­grated ce­ment plant in Duqm area. The plant will have a clinker pro­duc­tion ca­pac­ity of 5,000 TPD and it is es­ti­mated to cost $212 mil­lion (about RO 82 mil­lion). The new plant ca­pac­ity rep­re­sents about 58 per cent of Oman Ce­ment clinker ca­pac­ity.

In the weekly tech­ni­cal anal­y­sis, as we men­tioned in our last rec­om­men­da­tion that the MSM30 in­dex will reach the level of 4,540 points, which is hap­pened, cur­rently MSM30 in­dex is above the 50day mov­ing av­er­age and the in­dex will move to­wards 4,600 points if MSM30 in­dex closed above 4,540 points. Cur­rently the in­dex have a sup­port level at 4,500 points.

MSM 30 In­dex per­for­mance dur­ing Novem­ber was mod­er­ate and vic­tim to ex­ter­nal fac­tors, de­spite rel­a­tively good re­sults posted by the listed com­pa­nies. The gen­eral in­dex closed down by 0.25 per cent MOM with av­er­age daily turnover and vol­ume of RO 1.88 mil­lion and 15.8 mil­lion shares, no­table down on yearly ba­sis (Nov’17; RO 7.5 mil­lion, 20.2 mil­lion shares). 2018 was not a good year for many GCC fi­nan­cial mar­kets due fac­tors in­clud­ing in­vestors be­ing overly cau­tious and other ex­ter­nal fac­tors. The be­low chart in­di­cates the MSM30 monthly per­for­mance in 2018.

For­eign in­sti­tu­tional in­vest­ments reg­is­tered a net buy of RO 2.16 mil­lion in Novem­ber, which is the sec­ond month in raw to see the en­try of those in­vest­ments. How­ever, for 11M’18, for­eign in­vest­ments were net sellers with RO 113.8 mil­lion due to spe­cial deals.

As per the lat­est Na­tional Cen­ter for Statis­tics and In­for­ma­tion monthly bul­letin, the lo­cal pro­duc­tion and import of nat­u­ral gas reached 34.2 bcm in 9M’18, a yearly in­crease of 11.6 per cent. The us­age rate was 100 per cent with the in­dus­trial projects stood at 58.6 per cent of the total con­sump­tion ver­sus fol­lowed by Oil Fields (21.9 per cent), then Power gen­er­a­tions (18.9 per cent) and fi­nally the In­dus­tries Area (0.5 per cent).

MSM30 topped the gain­ers within GCC re­gion fol­lowed by Qatar Exchange (+2.26 per cent) while Dubai Fi­nan­cial Mar­ket was the big­gest loser clos­ing down by 3.31 per cent.

Within the GCC, an anal­y­sis of listed banks’ fi­nan­cials for 9m’18 earn­ings in­di­cates that Oman’s banks posted the high­est in­crease in net loans at 6.9 per cent YOY, fol­lowed by UAE banks at 6.3 per cent, Kuwait banks at 3.4 per cen­tyoy, Qatar banks at 3.0 per cent, and Saudi and Bahrain banks at 0.4 per cent YOY. The total GCC bank­ing sec­tor grew its total net loans to $1.31 tril­lion in 9M’18, up by 3.3 per cent YOY and 0.9 per cent QOQ, lion’s share of which lies with UAE (30.2 per cent) then Saudi Ara­bia (28.7 per cent).

Total GCC customer de­posits of listed banks stood at $1.45tril­lion at the end of 9M’18, up by 1.0 per cent QOQ and 4.4 per cent YOY. Fastest YOY growth was seen in UAE banks at 8.6 per cent YOY, fl­lowed by Qatar banks at 4.9 per cent YOY, and Oman banks at 3.6 per cent, Kuwait at 2.1 per cent and Saudi Ara­bia at 1.5 per cent and Bahrain at 1.1 per cent YOY. The en­tire bank­ing sec­tor’s Loan-to-de­posit ra­tio stood at 90.7 per cent.

Glob­ally, data compiled by Bloomberg re­gard­ing LNG ves­sel track­ing showed that Aus­tralia over­took Qatar as top LNG seller in Novem­ber 2018 for the first time dur­ing a month. Aus­tralia ex­ported 6.623 mil­lion tonnes of LNG in Nov’18 com­pared to 6.318m from Qatar. His­tor­i­cally, Aus­tralia LNG ex­ports form 22.5 per cent of total World ex­ports as per avail­able data com­pared to 26 per cent for Qatar.

(Cour­tesy: U-cap­i­tal)

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