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PEX within the Frontier Markets of the Financial Times Group

2016-09-29

Sahem Weekly Trading Report (25-29)-09-2016

In a week filled with fundamental news, Al-Quds Index traded in medium price range without any wide or significant price movements. This performance came on varied price trends of the stocks with the heaviest weights in the Index. The leading stocks were solely trading with unique performance depending on the price movement drivers on one hand and liquidity drivers on another hand. In terms of news, some general announcement supported what the Palestinian financial market is waiting for, while other news was related to some companies in execution to some taken strategic decisions.

This week, the announcement by the Financial Times Financial Indicators Group (FTSE Indices) to upgrade Palestine Exchange PEX from the list of markets on the "Watch List" to a Frontier Market after a long waiting time, has contributed in adding another positive factor for what was built and is still being built by all parties of the financial market since years. According to this upgrade, the PEX passed all the adopted market classification criteria by FTSE, to open the door for the listed companies to be included in FTSE indices based on the specific standards of each index alone. Undoubtedly, these indices importantly drag several international investors including the investment funds that follow specific indicators within the investment policies related to them.

On another hand and after the extraordinary general assembly meeting decision of Bank of Palestine BOP, and based on the latest disclosure regarding the merger between Palestine Commercial Bank PCB and BOP, the PEX announced executing the merger process through allocating every three shares in PCB equivalent to one share in BOP. Accordingly, subscribed capital of BOP increased to 195 million shares with market capitalization worth $501.17 million as for the end of the week and with contribution worth 15.13% from PEX market capitalization. On another hand, Palestine Investment Fund sold a new stake in the Arab Palestinian Investment Company APIC, to decrease its ownership in the company from 17.17% to 14.14%.

Regarding the market and following executing institutional transaction on the stocks of the Arab Palestinian Investment Company APIC, whereby it topped the PEX by 58.95%, to close below its highest historical recorded level at $1.83; significantly up by 3.39%. The stocks of BOP followed with transactions that contributed 10.71% from PEX total trading value. BOP declined by 1.15% to the level of $2.57. While the transactions of Palestine Telecommunications PALTEL contributed 6.89% from PEX total trading Value, to decline by 1.35% and close at the level of JD5.12. However, the price movement of Palestine Development and Investment Company PADICO was slow, to close at the level of $1.17; down by 2.50% and with transactions worth 4.09% from total transactions.