send to a friend by email

Al-Quds Index at its highest level since 2005

2021-12-30

 Sahem Weekly Trading Report (26-30)-12-2021

With the end of the year 2021, Palestine Stock Exchange PEX witnessed, in the last trading session of this year, price movements not only for the blue-chips, but for the other listed companies’ stocks as well. And if we exclude the last trading session of the year, the PEX trading was characterized with relative quietness and lack of normal liquidity. While trading on the stock of the largest investment company by market capitalization – Palestine Development and Investment Company PADICO- in the last trading session of the year witnessed rapid activity. While 2021 closing was the highest since 2005, to close at the level of 608.45 points at the end of the year 2021; up by 29.11% compared to its 2020 closing, and by 0.76% compared to its previous weekly closing level. Whereby, the performance of the PEX varied over the past 10 years, to record the highest closing of the Index at 608.45 points in this year 2021, and the lowest at 471.26 points by the end of 2020; with a compound annual growth rate CAGR of 2.47% since the year 2011. However, in another context and despite the varied behavior of investors in building their portfolios based on their investment strategies, the anticipation increases among all investors’ segments towards the disclosed annual financial statements of the listed companies, to predict the financial returns from the distributed dividends from one hand and the capital gains from another hand.

Regarding the economic indicators and according to a report by the Palestinian Central Bureau of Statistics PCBS and Palestine Monetary Authority PMA, the Palestinian economy began to recover gradually in light of the breaking of the epidemiological curve of the COVID-19 pandemic and despite the almost complete cessation of external support. The Palestinian economy recorded an increase of 6% during the year 2021 driven by the improvement in the level of aggregate demand, consumption and investment, while remaining below its pre-pandemic level, which led to an increase in the GDP per capita by 3.5%.  As for the quarterly level, where the first quarter of 2021 witnessed a decline in GDP by 6% compared to the same period of 2020, and as a result of easing the severity of the measures resulting from the pandemic, the second quarter recorded a remarkable increase of 19%. Such increase will continue during the third quarter of 7%. It is also estimated that this recovery will continue through the fourth quarter of the same year.

Also, according to a forecasting reports by the Palestinian Central Bureau of Statistics PCBS and Palestine Monetary Authority PMA, economic forecasts indicate that the Palestinian economy will a possibility for achieving a real growth during 2022 approximately by 3%, compared to estimate growth of 6% in 2021, with a slight increase in GDP per capita during 2022 compared to 2021, provided that this performance will be driven by the continued recovery of components on both the demand and supply sides. On the demand side, it is expected that overall consumption levels will continue to improve, to contribute by 2.2% to the expected growth, and investment by 2.3%. As for the external sector, it is expected that exports will contribute by 0.8%, and it is expected that the levels of demand for imports will rise in light of the improvement in consumption levels. Therefore, imports are likely to contribute to dampening the growth rate by about 2.1%.