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The highest weekly gain since the end of 2008 and the index is approaching the 600 points

2014-01-23

Sahem Weekly Trading Report [19-23/01[ 2014

Palestine Stock Exchange PEX continued to sequentially gain since the beginning of the current year, to end the third week of 2014 with fiery gains of 7%; the highest weekly return since December 2008. In corresponding, Al-Quds Index recorded a new high level that has abandoned since October 2008, to close at the level of 594.45 points, approaching its yearly closing 2006 after surpassing the yearly closings recorded between the years 2007 and 2013. In aggregate, Al Quds Index grew by 9.79% in 2014. This growth contributed in adding up $268.92 million to the PEX’s overall market capitalization, to record a value of $3.52 billion; up by 8.28% compared to the year 2013. The achieved growth was supported by optimistic liquidity within the increase in the investors’ and speculators’ appetite for activity on selective shares, boosted by new fresh liquidity, with the approach of disclosing the preliminary annual financial statements of the listed companies that some are expected to record positive double digits and are witnessing trading momentum. There is no doubt that everyone especially the investors are betting on reaching a shared vision regarding the U.S. Secretary of State John Kerry’s plan.

Regarding the active trading of this week, the share of Palestine Development and Investment Company PADICO witnessed a distinguished performance in terms of trading indicators, when achieved significant gains of 16.78%, to close at the level of $1.74 – its high since November 05, 2008- through intensive transactions of $9.00 million; to constitute around 50.74% from the PEX’s overall trading value during the week. This came due to the increase and accumulation of the purchasing bids on the gradual prices of PADICO that was offset by healthy profit taking by speculators resulting in active circulation to contribute in increasing PADICO’s liquidity’s indicators. PADICO’s share achieved gains of 28.89% in 2014, supported by trading activeness and rapid price movements due to the scarcity of selling offers given the sales conservatism on the recent approached levels near the book value as of September 30, 2013, but the anticipated financial statements dominates more the holding decision amid growing purchasing bids.

The share of Palestine Telecommunications PALTEL achieved gains of 9.27%, to come in the second place in terms of trading value in the PEX, when recorded trading value of $4.95 million; constituting around 27.88% from the PEX’s total trading value. PALTEL closed at the level of JD6.60; the highest level achieved since October 5^th, 2008 due to several cross transactions, while the natural transactions with fast movements dominated in anticipation of a distinguished financial return due to the significant growth of the net income of 9M 2013 in addition to other substantial news that came as a result of expectation or better investment profits of the company. Regarding the activity, the trading value of Bank of Palestine BOP increased to $1.08 million, closing at the level of $3.21; up by 1.90% to. On the other hand, the trading value of Palestine Real Estate Investment Company PRICO significantly grew to $1.00 million, whereby, the share closed at the level of JD0.77; up by 14.93%.

On another context and on the sideline of the Palestine Capital Markets Day in London, Ahmad Aweidah the CEO of the Palestine Exchange described 2014 as a ‘threshold year’ for Palestine’s economy. Speaking at the press conference at London’s Grosvenor House Hotel on 17 January, he described a series of critical factors that could significantly boost Palestine’s economy. “We are now achieving a series of important economic breakthroughs that could see our growth accelerate even more strongly. There is increasing appreciation of the potential presented by our financial services and banking sectors, ICT, infrastructure and high value agricultural sectors. Tourism is also beginning to make strong progress with attractions including Bethlehem, the Dead Sea and Jericho”. Also in the context of Standard & Poors Dow Jones launching a Stand Alone County Index for Palestine, John Davies the Vice President of the Global Exchange Traded Products at S&P Dow Jones Indices said: “The fact that we have built the Palestine Index is an important statement. We don’t build indices simply because we feel they are needed. We build them because our clients are asking for them. The establishment of the new Index is evidence that there is significant demand for investment in Palestine.”  Mr. Davies stated that the stand alone BMI index achieved a 41 percent cumulative returns since inception a year ago which compares favorably with the Pan-Arab composition Index at about 24.5 percent and the S&P500 Composition Index at about 30.2 percent.