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Monday, June 20, 2016 Ramadan 15, 1437 AH EGYPT’S EXPENSIVE GRAIN: Page 3 World’s biggest GULF TIMES wheat buyer seen sowing confusion, BUSINESS reaping higher costs Gradual increase in QCB overnight QCB may postpone 100% deposit rate is ‘assumed’: MDPS loan-deposit compliance By Pratap John Chief Business Reporter

Given the expected rate hikes by the Federal Reserve in the near term and the nature of the monetary policy under the Qatar Central Bank’s deadline amid liquidity (QCB) commitment to the exchange rate peg, a gradual increase in the QCB overnight deposit rate is assumed, the Ministry of Development Planning and Statistics (MDPS) has said. As Qatar’s currency is pegged to the US dollar, it has appreciated in both nominal and real effective terms since the middle of 2014, reducing imported shortfall issues: MDPS inflationary pressures, MDPS has said in its latest Qatar Economic Outlook (QEO) 2016-18. By Santhosh V Perumal The report said the nominal effective exchange rate Business Reporter (NEER) captures movements in bilateral exchange rates, weighted by respective volumes of trade flows. The NEER provides an accurate measure of iquidity issues may force the Qa- how the Qatari riyal is valued against the currencies tar Central Bank (QCB) to postpone of its major trading partners. The real effective Lthe deadline for compliance to 100% exchange rate (REER) adjusts for differential inflation loan-to-deposit ratio by one year to the end among its counterparts. of 2018, according to the Ministry of Devel- Qatar’s import bill declined in 2015 in part because opment Planning and Statistics (MDPS). the cost of goods and services diminished, MDPS “The deadline for compliance may be said. But the 12.7% REER appreciation from postponed until end-2018, given liquidity January 2014 to December 2015 has cut into the issues faced by Qatar’s banks, MDPS said in competitiveness of Qatari exporters with the Qatar Economic Outlook 2016-18. country’s primary trading partners, QEO said. The QCB had announced in early 2014 According to MDPS, the QEO’s forecasts are that local lenders should adhere to a new derived from an internally consistent numerical loan-to-deposit requirement of 100% by Liquidity issues may force the QCB to postpone the deadline for compliance to 100% loan-to-deposit ratio by one year to the end of 2018, representation of Qatar’s economy, based on the end of 2017. according to the Ministry of Development Planning and Statistics. PICTURE: Nasar TK standard economic accounting and consistency Highlighting that currently the deposit checks. The framework is based on a flow-of-funds side of the ratio includes only customer demand from the real estate and public sec- six GCC (Gulf Cooperation Council) bank- trols to bring them closer in line with the US model of the economy in which all sources of funds deposits and not long-term wholesale tors, MDPS said. ing markets, the ministry observed. Federal Reserve’s current rate: the deposit from the various sectors equal their total uses of funds, which have recently been the pri- “This shortfall in domestic financing Finding that in tandem the cost of fund- rate (0.75%), the loan rate (4.5%) and the funds. mary source of funding, MDPS said banks has taken the net foreign liability position ing has increased, MDPS said the Qatar repo rate (4.5%). The framework has been calibrated and updated are still in negotiation with the regulators of Qatar’s banking system to QR121.7bn as Interbank Off ered Rate (QIBOR) – a daily Additionally, the QCB could continue with known outcomes for 2015 and data revisions for to amend the loan-to-deposit formula to of March 2016, or 10.7% of the system’s reference point for banks borrowing unse- suspending Treasury bond issuances and 2012, 2013 and 2014. include long-term wholesale funds in the asset base, up from 4% a year earlier,” it cured funds from other fi nancial institu- reinstate the suspension of treasury bills. All GDP data forecasts are made on the basis of denominator. said. tions – has risen sharply over the past year. (After a four-month pause starting in early 2013 prices, following the current practice of the Lower oil and gas revenues have caused Tightening liquidity and fi scal concerns The overnight QIBOR increased by two- December 2015, QR1.5bn worth treasury Statistical Directorate of MDPS. public sector deposits in the domestic have pushed interbank rates and credit de- fi fth y-o-y as of May 11, when the three- bills – traditionally issued on a monthly ba- The main forecast assumptions are based on the banking system to shrink, tightening li- fault swaps upwards, it said, adding with month QIBOR climbed by a third. sis – was issued on April 5, 2016.) best assessment of the future made by MDPS and quidity and driving banks to raise funds strong demand for credit from the private Qatari banks’ eff orts to raise funds abroad Moreover, the QCB could also adopt un- draw on expert opinion as published in a wide range abroad, it said. and public sectors, banks have sought to have in part been due to falling public sector conventional measures akin to those used by of sources. Resident deposits – commercial banks’ furnish loans to clients amid slowing de- deposits, but also to meet Basel III require- central banks elsewhere, including the di- “Those on Qatar’s interest rates are based on the single largest domestic liability and fund- posit growth, helping to maintain the rise in ments, MDPS said. rect purchase of commercial bonds and the declared policy of the Qatar Central Bank (QCB) and ing source – dropped 2% year-on-year (y- the loan-to-deposit ratio. Stressing that the QCB has a range of acceptance of commercial bank liabilities expert opinion about the future trajectory of US o-y) in March 2016, when total domestic In April 2016, the ratio for domestic tools to tackle these issues, the ministry as collateral for QCB extraordinary loans or dollar interest rates,” QEO said. credit expanded by 13.9% y-o-y, driven by banks stood at 130%, the highest among the said it could reduce the three rates it con- equity injections in individual banks. NBAD, FGB in talks to form top Mideast bank

State-controlled banks confirm they’re studying a combination; Bank stocks add $4bn in a each bank has formed working day aft er merger talks group of senior managers for deal Plans to create one of the Middle East’s largest lenders by assets spurred Bloomberg more than $4bn of gains in Abu Dhabi Dubai/London banking stocks in one day, Bloomberg reported. National Bank of Abu Dhabi and First ational Bank of Abu Dhabi and Gulf Bank led the surge yesterday after First Gulf Bank said they’re the lenders said in a joint statement Nin talks to merge in a deal that they’ve formed working groups to would create the largest lender by as- explore a potential merger. Financial sets in the Middle East. institutions including Abu Dhabi Com- A group of senior executives from mercial Bank and Union National Bank each of the banks is reviewing the com- joined the rally amid speculation the mercial, structural and legal aspects of move may be the start of a new phase a potential transaction, according to a of consolidation in the UAE’s banking fi ling to the Abu Dhabi stock exchange industry. yesterday. Bloomberg News was fi rst to Abu Dhabi-listed banks added 15.96bn report the two lenders were consider- dirhams ($4.35bn) to their market ing a merger on June 16. value, according to Bloomberg calcula- A deal would create a lender with as- tions. NBAD, as the bank is known, led sets of about $170bn and mark the fi rst the way with a 15% surge – the most major banking merger in the UAE since allowed in a single day – increasing its A merger deal of National Bank of Abu Dhabi and First Gulf Bank would create a lender with assets of about $170bn and mark the fi rst major National Bank of Dubai and Emirates market value by 6.25bn dirhams. FGB banking merger in the UAE since National Bank of Dubai and Emirates Bank International combined in 2007 to create Emirates NBD Bank International combined in 2007 rose 11%, boosting its worth by 6.08bn to create Emirates NBD. The country’s dirhams. NBAD is the UAE’s second-biggest build investment banking businesses of syndicated loans in the six-nation velopment is the biggest shareholder fragmented banking industry is ready bank by assets, while FGB is fourth- to compete with bigger foreign rivals. Gulf Cooperation Council last year, in FGB with a 7% stake. The bank’s for consolidation and a deal could ranked. A combination would help them “We assume the merger is motivated while FGB ranked seventh, according market value is about $14.4bn, accord- prompt further transactions among will help them to lend to larger entities overtake Emirates NBD as the country’s by the complementary balance sheets to data compiled by Bloomberg. NBAD ing to data compiled by Bloomberg. lenders, according to investment bank and take up a greater share of the syn- largest lender and represent nearly a and the scope for economies of scale in was also the second-largest arranger The news is “a surprise consider- EFG-Hermes Holding. dicated loan book.” quarter of the system’s loans and de- a crowded UAE banking sector,” Fahd of bonds and sukuk sales last year. The ing, they have a very contrasting style “There’s no doubt it will lead to syn- Credit Suisse Group is advising state- posits, according to EFG-Hermes. Iqbal, head of Middle East research at loan league tables are dominated by of management and business strategy,” ergies and would give them a competi- controlled NBAD while UBS Group is The UAE is home to about 9mn peo- Credit Suisse, said in an e-mail yester- foreign lenders including HSBC Hold- Ghosh at SICO said. “One is a public- tive edge, considering there are more working with FGB, people familiar with ple and has about 50 banks, includ- day. NBAD would benefi t from FGB’s ings, Citigroup and Sumitomo Mitsui. sector focused bank, while FGB is an than 40 banks in the UAE,” Chiradeep the matter said, asking not to be identi- ing the local units of Citigroup, HSBC “focused and profi table retail fran- NBAD, with a market value of about aggressive private sector bank, with Ghosh, a banking analyst at Securities fi ed because the information is private. Holdings and Standard Chartered. chise,” while FGB would benefi t from $11.3bn at the end of Thursday, is 69% reasonable focus in consumer lend- & Investment Co in Bahrain, said by NBAD, FGB and Credit Suisse declined Both NBAD and FGB have pushed to NBAD’s liquidity and low funding owned by sovereign wealth fund Abu ing. FGB primarily operates within the phone yesterday. “The combined enti- to comment, while UBS wasn’t imme- expand in other countries to beat the costs, he said. Dhabi Investment Council. State- UAE, while NBAD is looking to expand ty will have a bigger equity book. That diately available to comment. limitations of a small home market and NBAD was the fi fth-biggest arranger owned investment fund Mubadala De- outside the UAE.” Pages 2, 12 Gulf Times 2 Monday, June 20, 2016 BUSINESS

FGB may pay 14% premium in deal

Abu Dhabi merger seen Bloomberg Dubai/London

First Gulf Bank could pay a premium of as much as 14% to buy National Bank of Abu Dhabi in a deal that would combine two of the biggest banks in the Middle East, just the start as banks according to a report by Arqaam Capital Ltd. NBAD, which is 69% owned by sovereign wealth fund Abu Dhabi Investment Council, would play the role of a junior partner in a deal, analyst Jaap Meijer said in a research report. Meijer said a combination between the two may also pressure other banks in the country to merge. face slower growth In what would be the country’s first major banking merger in almost a decade, National Bank of Abu Dhabi Middle East banks facing and First Gulf Bank said yesterday that they’re in talks declining asset quality, slow on a potential deal. Senior executives from the two growth; about 50 banks are banks are reviewing the commercial, structural and serving country of 9mn people legal aspects of a possible combination, according to a statement. The deal would create a lender with assets Bloomberg of about $170bn, surpassing those of Qatar National Dubai Bank. At a 14% premium to NBAD’s current market price, FGB would pay about $12.9bn for its rival. potential merger between “We see strong merits for a potential transaction, two of Abu Dhabi’s biggest notably better diversification, cost optimisation, Abanks may just be the start increased single party exposures and substantial of consolidation in the industry. funding advantages,” Meijer said in the note. That’s according to analysts A deal would mark the UAE’s first major banking- from EFG-Hermes Holding and industry merger since National Bank of Dubai Emirates NBD, which say the UAE and Emirates Bank International combined to needs more tie-ups because too create Emirates NBD in 2007. Emirates NBD chief many banks are serving a rela- executive off icer Shayne Nelson has called for further tively small population of 9mn consolidation, saying too many banks are serving a and growth prospects are limited. relatively small population. About 50 local and international lenders face declining government spending, slowing economies and falling asset quality after a slump in oil, the region’s principal export. In what would be the country’s fi rst major banking merger in al- Credit Suisse, UBS most a decade, National Bank of Abu Dhabi and First Gulf Bank said yesterday that they’re in talks on said to work with a potential deal. Senior executives from the two banks are reviewing the commercial, structural and le- Abu Dhabi banks gal aspects of a possible combina- tion, according to a statement. “This merger could pave the way Bloomberg for more consolidation in the sec- London/Dubai tor – Abu Dhabi Commercial Bank, Union National Bank and Abu Dhabi Islamic Bank,” EFG-Hermes redit Suisse Group and UBS Group, which have Holding analyst Shabbir Malik said scaled back from the Gulf since the fi nancial crisis, in a note yesterday. “The UAE’s Care advising on the potential merger of Abu Dhabi’s banking space is quite crowded, two largest banks, according to people with knowledge of credit penetration is high at about the matter. 100% of gross domestic product, create Emirates NBD in 2007. The GCC governments may rack up a “The current tightening li- day and FGB advanced 11% to 13.1 Credit Suisse is advising National Bank of Abu Dhabi while the credit and macro growth Dubai bank’s chief executive of- combined budget defi cit of about quidity in the banking sector due dirhams. Both banks reported a on the combination while UBS is working with First Gulf outlook is soft.” fi cer Shayne Nelson has called for $140bn this year if crude prices re- to lower oil price revenues has decline in fi rst-quarter net in- Bank, said the people, asking not to be identifi ed because The banks confi rmed a Bloomb- further consolidation, saying too main in the mid-$40s, according heightened the possibility of con- come. the information is private. Credit Suisse, NBAD and FGB erg News story on June 16 that said many banks are serving a relatively to Emirates NBD estimates. solidation, particularly as the in- “Consolidation would be posi- declined to comment, while a spokesman for UBS was not they were in talks on a potential small population. In the UAE, banks’ loans-to- dustry is seen to be too fragmented tive for UAE banks from a return immediately available for comment. merger. Bank liquidity in the six-na- deposit ratio worsened to 101.1% at present,” said Anita Yadav, head generation perspective,” said National Bank of Abu Dhabi and First Gulf Bank said A combination of NBAD and tion Gulf Cooperation Council, in April from 98.6% a year earlier, of fi xed-income research at Emir- Goldman Sachs Group analyst they’re in talks to merge in a deal that would create the FGB would mark the country’s fi rst which also includes Saudi Ara- according to central bank data. The ates NBD. Waleed Mohsin. “This is especially largest lender by assets in the Middle East. A working major banking merger since Na- bia, is tightening as the oil slump three-month interbank interest rate Shares of NBAD rose by the daily true given the fragmented na- group of senior executives from each bank is reviewing the tional Bank of Dubai and Emirates slows deposit growth and pushes earlier this month climbed to the limit of 15%, the most in more than ture of the market and the current commercial, structural and legal aspects, according to a Bank International combined to governments to boost borrowing. highest in more than three years. two years, to 9.2 dirhams yester- challenging macro environment.” fi ling to the Abu Dhabi stock exchange yesterday.

Saudi regulator Why Saudi’s Libor-like rate is in focus bars Deloitte from Regulator told banks to stop lowballing rate, sources said; rate jumps after banks audit work for said to get letter from regulator Bloomberg two years over Dubai/London During the 2008 global financial crisis, MMG case regulators discovered some banks had routinely manipulated their contributions to the London interbank off ered rate to disguise Reuters their real cost of funding, aff ecting the value Riyadh of trillions of dollars of loans and derivatives. The scandal resulted in more than $9bn in fines. Fast forward eight years and benchmark audi Arabia’s market regulator said it had interest-rate accuracy is again an issue, this barred the local unit of New York-based time in Saudi Arabia, where the regulator Saccountancy fi rm Deloitte & Touche from is said to have told banks there to stop providing accounting services in the kingdom lowballing submissions. Here we examine the for two years for breaching rules on accumu- Saudi interbank off ered rate, why it matters lated losses. and what to expect. The move by the Capital Market Authority’s The regulator hasn’t commented publicly on (CMA) Committee for the Resolution of Se- the matter and there has been no accusation curities Disputes stepped up penalties already of wrongdoing. The 15 banks that participate imposed on Deloitte over a long-running case in setting the rate declined to comment or involving its work for troubled Saudi contrac- didn’t respond to requests for comment when tor Mohammed Al-Mojil Group (MMG). contacted by Bloomberg. The CMA previously suspended Deloitte What is the SAIBOR and how is it from doing auditing work for listed fi rms in calculated? the kingdom for two years while the case was pending, beginning June 1, 2015. The Saudi Interbank Off ered Rate is a Is the situation in Saudi Arabia The judicial committee did not yet specify benchmark interest rate used to price loans denominated swaps and other derivatives, So which banks are on the panel comparable with Libor? the date when the new and more extensive sus- and derivatives in riyals. Each morning, 15 although hard estimates of the volume of that set the rate? pension would begin. banks are asked to estimate their borrowing derivatives priced using SAIBOR are diff icult Yes and no. When credit markets dried up at Deloitte did not respond to requests for costs for periods ranging from one month to to find. The 15 banks on the panel are: Arab National the time of the financial crisis, regulators found comment. 12 months, including what they need to pay to More broadly, SAIBOR is an important Bank, Bank Aljazira, Banque Saudi Fransi, that banks were lowballing their submissions The committee had on Thursday also sen- attract large deposits from customers. The top barometer of the creditworthiness of Saudi Hollandi Bank, Emirates NBD, Gulf to avoid the perception they were in trouble tenced three MMG executives to prison terms, and bottom two quotes for each duration are individual institutions and the market, International Bank, National Bank of Kuwait, and also to favour their derivatives positions. including founder Mohammad al-Mojil and excluded, and an average is taken of the rest. particularly in periods of stress. National Commercial Bank, Riyad Bank, Saudi While the lower submissions also appear to be his son Adel al-Mojil, the fi rm’s chairman, for The resulting rates are supposed to reflect the How is the slump in oil aff ecting British Bank, Samba Financial Group, Saudi an issue in Saudi Arabia, it’s not clear what is misrepresenting the company’s value. Both interest rates banks charge each other in the the banks? Investment Bank, Alinma Bank, Bank Albilad, behind the lowballing of rates alleged by the men are to serve fi ve years in prison, it said. A interbank market. Bank Muscat. regulator. third executive received a three-year sentence, What’s drawing attention to the Bank liquidity is tightening after a halving of The banks were all contacted by Bloomberg Has anything happened since the but was not named. The committee had further rate? oil prices over the past two years caused the and either declined to comment or didn’t regulator sent the letter? ordered MMG to pay 1.6bn riyals ($427mn) for growth in deposits to slow. The government return calls and e-mail requests for comment. “illegal profi ts” and imposed a separate fi ne of The Saudi Arabia Monetary Agency has is also draining cash from the system as it Where are the SAIBOR rates now? Publicly, at least, it’s been radio silence from 2.7mn riyals, according to the statement. written to banks instructing them to only seeks to plug the highest budget deficit since the regulator, banks and commentators. MMG has not traded on the Saudi bourse submit levels to SAIBOR at which they’re 1991. Last year, it raised 98bn riyals ($26bn) SAIBOR reflects liquidity conditions in the Dubai-based investment bank Arqaam Capital since July 2012, when the CMA suspended it willing to lend, after some banks were found from selling bonds to local institutions and banking system, with higher rates indicating a has been one of the few to comment on the shares over the losses after it over-extended to be lowballing interest rate submissions, will probably sell about 120bn riyals of debt tightening of credit conditions as banks charge news. In a note to investors, it said that it itself trying to take advantage of a construction according to people with knowledge of the in 2016, according to Saudi Fransi Capital. more to lend to their peers. Three-month doesn’t expect the Saudi Arabian Monetary boom in the kingdom. matter. The country has also eased some rules on Saibor now stands at 2.2% - its highest in seven Agency to levy any fines, without saying why. In an e-mailed statement on Friday, the Any misrepresentation matters because its banks to help alleviate the liquidity issue, years - and has increased 5 basis points since Still, it’s advising investors to keep away from Mojil family denied wrongdoing and said they SAIBOR determines interest payments on allowing them to lend the equivalent of 90% the regulator sent its demand to banks earlier investments in Saudi Arabian banks because would appeal the committee’s decision, calling an estimated 900bn riyals ($240bn) to 1.1tn of their deposits, up from an earlier limit of this month. of a slowing economy, tighter liquidity and the investigative process “defective from the riyals of loans. It is also used to price riyal- 85%. rising interbank rates. start.” Gulf Times Monday, June 20, 2016 3 BUSINESS

Egypt Orange off ered 4G licence for $400mn in spectrum shake-up

Reuters Cairo

range Egypt said yes- terday that Egypt’s tel- Oecommunications regu- lator had asked it to pay 3.54bn Egyptian pounds ($399mn) for a licence to off er fourth-genera- tion mobile phone services. The regulator had asked it to pay 100mn Egyptian pounds to acquire a fi xed-line licence and 1.8bn pounds to off er interna- tional calls, Orange Egypt said in a statement. Orange Egypt said it was look- ing into the licence off ers and had yet to make a decision. People queue for subsidised bread at a bakery equipped with a smart card system in the Suez Canal city of Port Said, 170km northeast of Cairo (file). Egypt buys local and imported wheat for subsidised bread for Egypt is selling the 4G licenc- its citizens. es as part of a long-awaited plan to reform the country’s telecoms sector and the regulator has con- fi rmed that it approached the three companies that currently off er mobile services about buy- ing them. Telecom Minister Yasser al- Qadi told television channel CBC last month that Egypt was Biggest wheat buyer is planning to off er high-speed 4G licences to companies already operating in Egypt. The reforms will allow Egypt’s land-line monopoly Telecom Egypt (TE) to enter the mobile phone market directly while al- lowing mobile operators to of- seen sowing confusion fer fi xed line services, ending its domination of the sector. TE, which is majority owned by the government, said yester- day it had also been granted a 4G licence. It was not clear how much TE, which does not off er its own and reaping higher costs mobile services but does own a stake in Vodafone Egypt, would Bewilderment returns over import Egypt’s international tenders earlier the biggest French cooperative, said in ‘ergot-free’ stance will make their contrast with the past two years when pay for the new spectrum. policy after fungus finding; import this year after similar rejections, and an interview in Paris recently. “We need next tender of great interest, if they purchases for the new marketing sea- “This move will enable TE to buying for the new season is due to confl icting statements on what level of a clear position from Egypt to be able to receive any off ers at all given the cur- son had already begun, according to fulfi l our long awaited goal of pick up soon the naturally occurring ergot fungus it do normal business.” rent weather outlook,” UK-based Bloomberg records. Its farmers are becoming a total telecommu- allowed. The Agriculture Ministry on June 12 trader Gleadell Agriculture, owned by wrapping up the harvest and govern- nications operator, by off ering Bloomberg The latest events, just weeks before confi rmed it will apply zero tolerance France’s Invivio and Archer-Daniels- ment purchases of local wheat are mobile services,” TE CEO Tamer London/Cairo the new marketing season starts on July for ergot, which can be toxic in large Midland Co, said in a report e-mailed above target. Gadalla said in a statement. 1, mean traders may again balk at join- amounts, until the government com- on June 9. “It will be harder for Egypt to buy It was not clear what would ing tenders, or charge premium prices pletes a study of risks. State-run grain Export prices for wheat have climbed and they will need to pay more” unless happen to the Vodafone Egypt gypt looks set for another season because of the higher risk, said Alex- buyer General Authority of Supply in recent weeks in both France and Rus- it clarifi es its policy on ergot soon, Ag- stake if TE begins off ering mo- of expensive grain. andre Boy, an analyst at Agritel in Paris. Commodities on the other hand said it sia, two major exporters, amid concern ritel’s Boy said in an interview in Paris bile services directly. E Traders are casting a wary eye “Today, I wouldn’t take the risk of will accept 0.05% ergot in shipments. that excess rain in both countries will on June 9. After the ergot issues earlier Under previous reform plans, on the largest wheat importer after it selling a 60,000 tonnes vessel and Egypt buys local and imported wheat erode crop quality or hurt yields. this year, only a few companies were which have since been scrapped, again turned away cargoes because of guarantee zero ergot,” Philippe de Ray- for subsidised bread for its citizens. Egypt hasn’t issued an international participating in the tenders, he said. TE would have had to dispose of fungus in shipments. Many boycotted nal, chief executive offi cer of Axereal, “News that Egypt will keep their tender for wheat since mid-April, a “We will have the same issue.” its stake.

Kurds ready for new oil deal with Baghdad if Iran in talks with China, Russia they get $1bn a month

Reuters Baghdad and then to the market, lenders on fi nance hub plan Erbil, Iraq it doesn’t make any diff erence,” he said.”We are ready to enter dialogue with Baghdad.” Bloomberg Iraq’s Kurds are ready to strike The KRG stopped delivering crude Dubai an agreement with the central oil to the central government a ‘Contract signed with Boeing to purchase 100 planes’ government in Baghdad on a year ago, a decision taken when deal to increase oil exports, if it Baghdad’s payment fell under ran plans to set up a fi nancial centre Bloomberg guarantees them a monthly rev- $400mn a month, according to on the free zone at Qeshm island as it Dubai enue of $1bn, a spokesman for the Dizayee. Iseeks to attract fi nancial institutions Kurdistan Regional Government The Kurdish region exported an to a market of 80mn people. (KRG) said. average of 513,041 barrels in May Chinese and Russian banks are seek- Iran has signed a historic agreement Iraq’s central government in through the pipeline to Turkey, ing to set up representative offi ces in the with Boeing Co to purchase 100 March stopped oil exports generating about $391mn, of area, Farhad Taghizadeh-Hesary, senior jetliners, concluding several stages of through a Kurdish pipeline to which about $75mn was paid to adviser to the Qeshm Investment and negotiations, an Iranian newspaper has pressure the local authorities to oil companies that produce the Development Co, said in an interview. reported. resume talks about an oil revenue crude, according to KRG off icial One of Japan’s largest banks is also ne- The plane maker has applied for a sharing agreement. estimates. gotiating with offi cials on establishing a licence from the US Treasury to permit Iraq’s state-run North Oil Com- “The companies have been as- presence, he said, declining to identify the deal and the final details will be pany normally exported 150,000 sured that certain amounts will the banks. revealed once government approvals bpd through the pipeline that be made on a monthly basis,” said “The aim for this fi nancial centre isn’t are obtained, Ali Abedzadeh, director of comes out at the Mediterranean Dizayee, referring to the three to look onto Qeshm, but to be a window Iran’s Civil Aviation Organisation, said in port of Ceyhan, in Turkey. The foreign oil producers in the KRG onto the mainland.” he said by phone. an interview with the Iran newspaper. pipeline also carries oil produced region: DNO, Gulf Keystone and “There is much interest to enter Iran.” The transaction would be the Chicago- in the Kurdish region in northern Genel. Iran’s economy has traditionally re- based plane maker’s first in Iran since Iraq and sold independently from “We have started to pay some of lied on oil revenue and consumption sanctions were lifted from the nation in the central government. it, at least it has rebuilt that confi- by the internal market. That market January and follows a $27bn agreement KRG spokesman Safeen Dizayee dence between the government provides opportunities for retail bank- with Airbus Group for 118 planes, said in an interview in the Iraqi and the IPCs (oil companies,” he ing and project fi nance as the country including the A380 and A350 models. Kurdish capital Erbil last week said, referring to arrears owed to vies to overhaul its infrastructure and Iran’s eff orts to upgrade its ageing air that the Kurdish authorities would the companies. spend billions of dollars expanding air- fleet may be complicated by regulatory be willing to sell the oil through The KRG in February said it ports, transportation links and its en- hurdles, with manufacturers required Baghdad if they get a share from will be paying international oil ergy sector after the lifting of economic to obtain licences from the US Treasury The transaction would be Chicago-based Boeing’s fi rst in Iran since the federal budget amounting to a companies in 2016 according to sanctions in January. The International Department and some remaining sanctions were lift ed from the nation in January $1bn a month. the terms of their contracts, after Monetary Fund expects Iran’s economy sanctions making it diff icult to arrange “If Baghdad comes and says ok, making ad-hoc payments last to expand 4% in the 12 months to March financing. days as the plane maker has received a Fakhrieh Kashan, deputy minister for give me all the oil that you have year. 2017. Iran expects to finalise a contract with “promise” from the US Treasury that it roads and urban development, told Fars and I’ll give you the 17% as per the The foreign operators have been “We have lots of feasible projects in European plane maker Airbus within 30 will get its licence within 10 days, Asghar News in an interview. budget, which equals to 1bn, I think, reluctant to invest and further de- diff erent sectors that are interesting to logically it should be the thing to velop assets in the region without foreign investors,” Taghizadeh-Hesary accept,” he told Reuters, specifying the promise of regular payment, said. “However, one of the bottlenecks is ternational capital,” said Payam Afzali, economy for a prolonged time, so they vestors and international companies to later that the amount referred to a while the cash-strapped KRG the lack of access to cheap fi nance. The managing director and head of invest- are under pressure,” he said. help lift his country’s economy, which monthly payment in dollars. needs production to increase as fi nancial centre can help us access cheap ment banking at Kian Capital, a Tehran- Iranian President Hassan Rouhani, still suff ers from infl ation and chronic “Whether this oil goes to the it struggles to avert an economic fi nance,” he said. based investment banking and asset who made the lifting of sanctions his top youth unemployment. At stake is his international market or first to collapse. Iran’s banks are fi nancially under pres- management fi rm. “They’ve had to take pursuit during his fi rst term ending next ability to win a second term in the 2017 sure because of the lack of access to in- the burden of fi nancing the country’s year, is betting on an infl ux of foreign in- presidential election. Gulf Times 4 Monday, June 20, 2016 BUSINESS

Pressure mounts on prime minister Who will replace Rajan? to fi nd a successor

Bloomberg ministration saw the consultations New Delhi between Rajan and Jaitley over his second term as still ongoing, and India searches for new it has no obvious successor lined Raghuram Rajan will exit India’s up, the person said. central bank after unnerving political Now with Rajan heading out the leaders with calls for free speech door, pressure may rise on Modi’s and religious expression. The focus government for an accelerated now shifts to whether Prime Minister timetable. When a local newspa- Narendra Modi can find a successor per reported that Rajan had told central bank governor able to command credibility both Modi he didn’t want another term, with investors and his party. it prompted the rupee to retreat Bloomberg The man who captured interna- - showing the potential impact New Delhi tional attention with a prescient Rajan’s weekend news might have 2005 speech warning about a on the financial markets when buildup of global financial risks trading opens today. ith Indian central bank gover- on Saturday declared he’ll leave Jaitley moved swiftly to address nor Raghuram Rajan heading the Reserve Bank of India at the risks over the lack of a succession Wback to academia after his term end of his term in September. The plan, saying in a Facebook post af- ends in September, the search for his re- outgoing governor made clear ter Rajan’s letter that “a decision on placement has begun. that he was ready to continue: “I his successor would be announced Finance Minister Arun Jaitley said on was open to seeing these develop- shortly.” In the three-sentence Saturday that a successor would be an- ments through,” he said of his statement, Jaitley said the govern- nounced shortly. India’s central bank work on reining in inflation and ment “respects his decision.” chiefs are appointed by the prime minister addressing bad loans in the bank- Finance Ministry spokesman in consultation with the fi nance minister. ing system. DS Malik declined to comment on Below are potential candidates to suc- As someone who spent several the deliberations, while Jagdish ceed Rajan as governor in the world’s fast- decades overseas, Rajan became Thakkar, a spokesman in the est growing major economy, according to a key target of hardliners in Prime Minister’s Off ice, didn’t Ambit Capital and media reports. Modi’s party who don’t always answer two calls to his mobile Urjit Patel, deputy governor, cheer educated Indians who build phone. Reserve Bank of India their careers abroad. The former Rajan’s announcement left Urjit Patel, like Rajan, has spent several International Monetary Fund chief economists and private-sector years overseas and has about 25 years of economist wasn’t shy in speaking players scratching their heads. experience in economic policy making. out on topics outside monetary The broad consensus had been With a doctorate in economics from Yale policy. He used his post as a bully that the government would even- University, Patel has been a key architect pulpit to advocate for going after tually give Rajan a second term of reforms at the Reserve Bank of India, tycoons he described as crooked, despite the political noise, due including the establishment of an infl a- liberating the poor from “venal” largely to the wide respect that tion targeting framework. politicians and calling for toler- Rajan commands among indus- A panel headed by Patel, 52, had pro- ance in a nation vulnerable to trialists, investors and economic posed a shift to consumer-price infl ation religious violence. leaders around the globe. to anchor monetary policy. As part of this, Dealing with Rajan, 53, present- Lawrence Summers, a former the government agreed last year to adopt a ed a challenge for Modi, who built US Treasury secretary who 4% infl ation target with a band of plus or a pro-business, pro-deregulation criticised Rajan as “Luddite” for his minus two percentage points, and to have record as chief minister of Gujarat 2005 warning of a financial crisis a monetary policy committee set interest state yet also relied on national- at the elite Jackson Hole annual rates. ists to secure the historic win that economic gathering, on Saturday “Urjit Patel appears to be best placed as swept him to off ice in the 2014 said he was “one of the few central he possesses the appropriate skills from national election. In recent weeks, bank governors who has changed a macroeconomics perspective besides the prime minister and his finance the regime in a major country.” holding the promise of independence,” chief, Arun Jaitley, did little to rein “I wonder what precipitated Ambit analysts Ritika Mankar Mukherjee in pointed attacks by Subrama- him to take this action,” Deepak and Sumit Shekhar wrote in a report in nian Swamy, an outspoken law- Parekh, chairman of Housing April. maker with a large Twitter follow- Development Finance Corp, India’s Rajan raised borrowing costs after he Rajan: Search on for his replacement as RBI chief. ing who said Rajan was “mentally largest mortgage lender, told took over in 2013, citing the Patel Com- not fully Indian” and kept interest Bloomberg Quint, Bloomberg’s mittee report as a road map to ease one of was one of the only two state-controlled Prime Minister Narendra Modi initially In his current job, Subramanian gives rates unnecessarily high. India television and digital ven- Asia’s highest infl ation rates. Patel joined banks among 28 that expanded loans by brought Das into the fi nance ministry to input on the economy and authors the As recently as June 7, Rajan told ture. DS Rawat, secretary-general the central bank in 2013 from The Boston more than 10% in the year to March 31, head revenue department, which was bat- Economic Survey, an annual report card reporters to watch for statements of the Associated Chambers of Consulting Group, where he served as an data compiled by the fi nance ministry tling perceptions of “tax terrorism.” In of the fi nance ministry. He is also a mem- from Modi and Jaitley regarding his Commerce and Industry of India, adviser. He worked with the International shows. that role, Das proposed lowering the cor- ber of the fi nance minister’s expert group future, joking that it would “be cruel expressed hope that Rajan would Monetary Fund for fi ve years until 1995, She is also credited with ushering in porate tax rate, and led government eff orts on the Group of 20. He prepared a report for me to spoil the fun the press is reconsider the decision. and also served in India’s fi nance minis- technology in the 200-year-old institu- in curbing black money by negotiating a on potential rates for India’s long-delayed having with all this speculation.” “Once again messy politics gets try as a consultant in the economic aff airs tion. Bhattacharya has demanded more deal with Switzerland for more disclosure goods-and-services tax, which is still Modi’s administration repeatedly the better of good economics,” division. power for bankers to tackle bad loans, and and announcing an amnesty programme. stuck in parliament. said a decision on the RBI governor Mohamed El-Erian, chief economic Patel didn’t immediately respond to an pushed for the merger of State Bank with Das has been a key fi gure in putting Modi’s appointment of Subramanian would be made in August, weeks adviser at Allianz, said on Twitter. e-mail seeking comment. fi ve subsidiaries. together India’s budget, often acting as was seen as a surprise because he was before the end of Rajan’s term. Rajan’s announcement marked Arundhati Bhattacharya, After Rajan’s announcement on Satur- a crucial link between the fi nance min- critical of the government’s move to block Yet in the past few weeks, Rajan a clear political win for the nation- chairman, SBI day, she said: “Dr Rajan is a person of very istry and other departments. He also ac- a World Trade Organisation deal and was disappointed that Modi’s gov- alist elements in Modi’s Bharatiya Arundhati Bhattacharya, 60, took over high calibre, who has built ably on the tively promotes government initiatives on called some of its budget numbers “im- ernment was dragging its feet on Janata Party. Swamy cheered the as head of India’s largest lender in 2013 reputation of our central bank and given it Twitter, a trait Modi appreciates among plausible.” After taking up the post, Sub- giving him a second term and failing decision, saying on Twitter that his and revamped its operations. If appoint- a very large measure of credibility.” his ministers and bureaucrats. Das, due to ramanian said it was a “great honour” to to back him publicly against attacks, admiration for Modi “has gone up ed, she would be India’s fi rst female cen- Shaktikanta Das, economic aff airs retire in February 2017, didn’t answer two serve in a government that has a mandate according to a former top off icial hugely” because “he did not bend” tral bank governor. secretary, fi nance ministry calls to his mobile phone on Saturday. for “reform and change.” familiar with the deliberations over to pressure to extend Rajan’s term. In 2014, Bhattacharya was ranked Shaktikanta Das, 59, is a career bureau- Arvind Subramanian, chief eco- A senior fellow on leave from the Center Rajan’s extension. In discussions with Modi triggered Rajan’s exit among the 50 Most Infl uential people crat with almost four decades of service. nomic adviser, fi nance ministry for Global Development and the Peterson the government, Rajan wasn’t given with a campaign of “insinuations, in global fi nance by Bloomberg Markets His job requires him to closely coordinate Arvind Subramanian, 57, replaced Rajan Institute for International Economics, assurances over a second term, the baseless allegations and puerile magazine. She was also ranked as the with the central bank, and he’s involved as chief economic adviser in the fi nance Subramanian has expertise on topics in- former off icial said. attacks” on the governor, accord- fi fth-most powerful woman in fi nance by with discussions on setting up a new ministry in October 2014. The Oxford cluding growth, trade, oil and intellectual Rajan’s letter on Saturday ing to Palaniappan Chidambaram, the Forbes magazine. monetary policy committee. University-educated economist is a pro- property. He has also served as an assist- caught Modi’s government by sur- a former finance minister in the Bhattacharya has overseen State Bank’s As a director on the board of the Reserve ponent of lower interest rates and has ant director in the International Monetary prise, according to another person previous Congress party-led expansion to about 17,000 branches, Bank of India, he understands how the in- supported an easier budget defi cit goal to Fund. He declined to comment when con- familiar with the situation. The ad- government. 330mn customers across 36 countries. It stitution functions. boost public expenditure. tacted on Saturday. Australia taxes foreign home buyers as affordability bites China Resources opposes Vanke share sale plan Bloomberg AFP such as New Zealand and Canada. “It is very bad. Beijing Sydney Without the Chinese nothing would ever get built,” the country’s richest man and head of prominent developer Meriton, “high-rise” Harry Triguboff told hina Vanke Co Chairman Wang Shi’s Sydney is imposing new taxes on foreigners buying The Australian Financial Review this week. bid to fend off a takeover has been homes as concerns grow that a flood of mostly “Never mind the bullshit stories, sales volumes have Cthrown into doubt after the property Chinese investors is crowding out locals and killing already dropped and prices are coming down steadily. developer’s second-largest shareholder, Chi- the “Great Australian Dream” of owning property. The Chinese buyers are already disappearing.” na Resources (Holdings) Co, said the proposal Ownership rates across the country are among Analysts say Australia is an appealing market par- failed to get enough votes from the board. the highest in developed nations, with having your ticularly after Hong Kong and Singapore introduced Vanke’s 45.6bn yuan ($6.9bn) plan to buy own house long viewed as a key aspect of Austral- a 15% property tax on non-local buyers and as the assets from Shenzhen Metro by issuing new ian identity. local dollar weakened against other currencies. shares didn’t pass the board because it needs But as prices rise to record levels — Sydney is The proposed tax in Sydney’s New South Wales approval from two-thirds, or eight, of the 11 ranked only second to Hong Kong as major cities state to be announced this week would be only 4%, members, China Resources said on Saturday with the world’s least-aff ordable housing — new in Queensland it is 3% and in Victoria 7%. in a statement on its offi cial WeChat account. potential homeowners have been increasingly The island continent experienced an average Shenzhen-based Vanke said on Friday its forced out of the market with foreigners blamed as 7.25% annual housing growth over the past three board voted 7-to-3 in favor of the plan after a key factor. decades according to the central bank, attracting one director chose to abstain, citing a confl ict Pedestrians walk past the China Vanke headquarters in Shanghai. Vanke chairman Wang Shi’s bid “The governments want to respond to a percep- Chinese investment into commercial and residential of interest. to fend off a takeover has been thrown into doubt after the property developer’s second-largest tion about housing aff ordability and the impact real estate. The opposition from a long-term major shareholder, China Resources, said the proposal failed to get enough votes from the board. of foreign investment on that,” KPMG Australia’s Chinese invested Aus$4.2bn in 2011-12, rising shareholder adds uncertainty to Wang’s ef- indirect tax specialist Michelle Bennett told AFP. to Aus$24.3bn in 2014-15 according to Australia’s fort to counter little-known Baoneng Group, Resources, which owns 15.24% of Vanke. The The proposal doesn’t give Vanke ownership “(Politicians) are raising money from people who Foreign Investment Review Board, making them the which overtook China Resources as the com- proposed price of 15.88 yuan per A share im- in Shenzhen Metro itself and won’t secure aren’t voting, so superficially you can understand largest overseas buyers. pany’s largest shareholder last year in what plies a discount of 24% to Vanke’s net assets, cooperation opportunities in other projects that it’s possibly not bad politics,” she added, but But foreign investment — including in local firms Vanke management labelled as a “hostile and the land being bought, which wouldn’t with the subway builder, China Resources warned the measures could be a “blunt instrument” and agricultural land — is politically sensitive and takeover.” If the current proposal goes ahead, contribute profi t for the next two to three said. The land price also doesn’t include tax- that could hurt the market. last year the national government forced some Baoneng’s shareholding in mainland China’s years, would dilute earnings, it said. es, which would signifi cantly push up even- Last year, leading apartment developer Lend off shore owners to sell properties after tightening largest listed property developer would be Zhang Liping, an independent director on tual costs for Vanke, it said. Lease sold out more than Aus$600mn ($445mn) regulations. Housing aff ordability, and the role of diluted to 19.27%, while Shenzhen Metro Vanke’s board who’s currently employed by Vanke defended the proposal in a sepa- worth of new units in Sydney’s Darling Harbour property investors, has also been a key battle- would own 20.65%, according to Friday’s ex- Blackstone Group, didn’t vote on the pro- rate statement, saying it expected the deal to in under five hours, with The Australian Financial ground ahead of national elections on July 2. change fi ling. posal because the two companies are in talks bring “continuous quality project resources” Review reporting that one-third of buyers were But with housing prices appearing to be coming “If Vanke doesn’t reconsider the problems about a commercial property project, ac- in key Chinese cities at “reasonable” prices, foreign. Lend Lease said the sale broke local records off the boil and the economy transitioning away in the restructuring proposal and submits the cording to the exchange fi ling. Only mem- and that becoming a major Vanke share- but such reports have also fuelled calls for govern- from a mining boom, analysts say the state taxes same plan for a vote at board or shareholder bers directly affi liated with the companies holder, was the only consideration Shenzhen ment action to protect Australian buyers. could backfire. meetings in future, China Resources would involved in the resolution being voted on - in Metro would accept. In response, the New South Wales, Victoria and “It’ll have ramifications down the track when the continue to vote against it in order to protect this case, Shenzhen Metro - should be ex- The two projects being acquired were the Queensland state governments have introduced market goes through a pretty significant downturn the interests of all shareholders,” the state- cluded from voting, China Resources said. “best two land sites in Shenzhen” - a city or are set to slap new property and land taxes on in terms of construction and developers are finding owned conglomerate said in the statement. The three directors from China Resources where developers are fi nding it increasingly foreign buyers, sparking an outcry from develop- it hard to get projects going,” BIS Shrapnel’s manag- Vanke has a low debt burden and can use voted against the deal, although the company diffi cult to obtain land - and would become ers fearful that they will flee to other markets ing director Robert Mellor told AFP. either cash or debt to fi nance the deal and agreed the assets being bought could benefi t an important source of profi t for Vanke, doesn’t need to sell new shares, said China Vanke’s business, according to its statement. board secretary Zhu Xu said in the statement. Gulf Times Monday, June 20, 2016 5 BUSINESS

S&P 500 posts worst week since April as Visium to shut down four of global stress burns anew

Bloomberg its remaining hedge funds New York Bloomberg a professor at the University of Michi- New York gan Ross School of Business. Visium rices fell and volume will suspend withdrawals from the surged in a week of height- Balanced Fund in order to treat inves- Pened anxiety for US inves- acob Gottlieb’s Visium Asset Man- tors fairly and intends to start returning tors, whose dreams of reaching a agement, the once high-fl ying money to investors by the end of July, record high anytime soon all but Jhedge fund fi rm that at its peak Gottlieb said in the letter. faded away. managed $8bn, is shutting down four The fi rm estimates that between 3% A streak of six weeks with- of its remaining hedge funds after one and 5% of the assets will be withheld out a 1% drop was broken as the of its star managers was arrested and to establish a reserve for the fund’s li- S&P 500 Index dropped 1.2% to accused of insider trading. abilities. He said specifi c details on the 2,071.22, the worst retreat since The New York-based fi rm will liqui- timeline will be provided to aff ected April. Shares slid on four of the date the main Balanced Fund, as well as investors. According to the indictment, fi ve days, including a 30-minute its Institutional Partners Fund, Equity Valvani hired a consultant to get infor- plunge on Wednesday that fol- Alpha Fund, and Equity Alpha UCITS mation about the approval status of a lowed testimony from Federal Fund, according to a letter to investors generic drug. Reserve Chair Janet Yellen that seen by Bloomberg News. Visium earli- Valvani is accused of using the infor- fanned apprehension about er struck an agreement to sell its multi- mation to trade in stocks, and passing prospects for economic growth. sector hedge fund to AllianceBernstein. the information to Plaford, who over- Pain was worse below the sur- The decision follows months of tur- saw the credit fund, prosecutors said. face, with the S&P 500 Banks moil at Visium that began in March Plaford and Lumiere were charged Index dropping 3% for its third when Gottlieb told investors his fi rm over separate allegations that they used straight decrease. The Nasdaq was under federal investigation for sham broker quotes to mismark the Biotech Index fell 4.1%, extend- some trades. value of securities, infl ating returns, ing its losing streak to nine days, On June 15, US prosecutors said and generated more than $5.9mn in the longest in two decades. The they arrested Sanjay Valvani, a Visium extra fees for the credit fund, the US gauge has lost more than 10% partner and money manager, who the said. Lumiere helped Plaford oversee during the skid. government claims reaped more than the fund, which was called the Credit Anxiety fl ared globally as con- $32mn from trades in drug compa- Opportunities fund and peaked at cerns ranging from Japanese nies using secret tips. Already before $470mn, according to court papers. It stimulus to Britain’s referendum the news, clients had asked to pull at returned 32% in 2010 before fi zzling on secession from the European least $2bn from the fi rm in the second out and closing in 2013, according to Union pushed the Chicago Board quarter, people familiar with the mat- people with knowledge of the matter. Options Exchange Volatility In- ter said. The expertise of Gottlieb, a trained dex up 14% after a 26% increase a “These were very diffi cult decisions medical doctor, drew interest in the week earlier. Volume on American for me and the Visium team but given Balanced Fund, a long-short equity exchanges averaged 7.5bn shares, the uncertainty relative to the fi nal fund that invests in healthcare compa- the most since March. Ten-year outcome of the recent regulatory de- nies. The strategy, which includes per- Treasury yields fell a third straight velopments, the negative impact of the formance before Gottlieb started Vi- week by a cumulative 24 basis resulting publicity, and the substantial Gottlieb: Assuring to treat investors fairly. sium, gained an annual average of 13% points, the biggest three-week investor withdrawals, it became clear since its 2001 inception through the plunge since February. that maintaining the status quo was cused of infl ating the value of a now- Street. FrontPoint Partners liquidated transition all that fund’s operations fi rst quarter of this year, and oversaw “US yields have moved down increasingly untenable for the fi rm,” closed credit fund. in 2011 amid client withdrawals af- in the following 90 days. The Global about $4bn, according to an investor very sharply, and the question is Gottlieb said in the letter. Visium, which had $7bn under man- ter former healthcare money manager Fund’s investment staff and some sup- letter obtained by Bloomberg. whether that’s just in sympathy As of last year, the fi rm managed fi ve agement as of March 31, and its founder Chip Skowron was charged with secu- port staff will also join the asset man- Gottlieb started his career after with Europe and Japan or some- hedge funds and a mutual fund, and Gottlieb weren’t accused of wrongdo- rities fraud. He was sentenced to fi ve ager, Gottlieb said, adding he won’t join medical school as a buyside analyst at thing more troublesome - like a was seeking to raise $500mn for a pri- ing. Visium is the biggest hedge fund in years in prison. AllianceBernstein but will stay invested Sanford C Bernstein, which was bought sign the US economy is starting vate equity vehicle. The letter didn’t the industry to have employees linked Diamondback Capital Management in the fund. in October 2000 by Alliance Capital to to weaken more broadly,” said discuss the private equity fund. to criminal wrongdoing since the gov- shuttered in 2012 after former money The Global strategy returned an an- form AllianceBernstein. Charlie Bilello, director of re- Valvani, who had been with the fi rm ernment set its sights on billionaire manager Todd Newman was accused of nual average of 18.9% since its incep- He was there from 1998 until 2000, search at New York-based Pen- since it was started in 2005, ran a por- Steve Cohen’s SAC Capital Advisors. insider trading. tion in 2007, two years before it became according to his LinkedIn profi le. He sion Partners. “The uncertainty tion of Visium’s main fund, the Visium That fi rm pleaded guilty to federal in- Newman was found guilty, but his a standalone vehicle. More than $2bn joined Balyasny Asset Management around Brexit is also probably Balanced Fund. sider-trading charges in 2013, agreed conviction was overturned and Dia- was invested in the fund as of the end of in 2001. The healthcare strategy was adding to the volatility in the US prosecutors also revealed that, in to pay $1.8bn and was forced to shut its mondback was refunded a penalty it March, according to an investor docu- spun out of Balyasny, where Gottlieb past week and people are posi- addition to Valvani, two former Visium doors. paid to the government in connection ment obtained by Bloomberg. worked as a portfolio manager until tioning for that.” employees were charged with securi- Gottlieb’s fi rm joins several funds with the case. “The assets are worth more in some- 2005. Gottlieb soon started to expand US shares have now fallen on ties fraud. Chris Plaford was charged that have closed after employees were Gottlieb said in the letter that Visium one else’s hands, but not for long be- the fi rm beyond healthcare stocks. In six of seven days after closing with trading on illegal stock tips, and ensnared in the government’s multi- expects to fi nalise the transaction with cause redemptions reduce their value 2009, Visium launched Visium Global within 1% of a record on June 8, Plaford and Stefan Lumiere were ac- year probe of insider trading on Wall AllianceBernstein within 30 days and to potential buyers,” said Erik Gordon, and a credit pool. pushed down by concern over valuations, a four-quarter de- cline in corporate earnings and perceptions the Fed’s grip on the economy has loosened. The S&P 500 came within ‘Brexit’ fl ips script on bonds as economic signals muddied points of erasing its 2016 ad- vance on Thursday before ral- lying, then slipped again in the Bloomberg Some investors read falling Treas- look very attractive.” Bonds have staged curity due in May 2026 was 100 5/32. annualised growth rate in the second week’s fi nal session. New York ury yields as a signal of US economic a worldwide rally that pushed yields The yield touched 1.52% on June 16, the quarter, up from a 0.8% rate in the pre- Investor worries over Brexit weakness. Yet doing so confuses the in Japan, Germany and Switzerland to lowest since August 2012. vious three months. and future monetary policy, relationship between economic funda- record lows this week as central banks “Ten-year yields have been off ering “The markets seem to be less sensi- along with the quarterly expira- s opposing domestic and global mentals and market moves, economists maintain or boost stimulus programs to more value compared to other sover- tive to the economic data,” said Stephen tion of options and contracts, forces vie for infl uence in the at Deutsche Bank said last week. In combat fl agging economic growth and eign bonds,” said Steve Kang, a US rates Stanley, chief economist in New York spurred a resurgence in volume ATreasuries market, the story of fact, today’s ultra-low yields represent infl ation. strategist at Citigroup in New York. at Amherst Pierpont Securities. “The last week. After three weeks of the US economy may be getting lost in a departure from the traditional link The Federal Reserve on June 15 held “The global factor has been the deter- markets are so infl uenced at this point depressed trading activity, aver- translation. between these forces, they said. rates steady and lowered its projec- minant factor for the 10-year yield for by some of the global distortions that age daily volume this week was US 10-year notes gained for a third “I talk to so many clients who say, tions for the path of policy tightening, the past couple of months - more so the domestic data don’t have the in- the highest since March 18 when week, with yields touching the lowest ‘rates are very low so you can see that even as it left forecasts for US economic than the US economic surprises.” fl uence they might have had in a more US shares were emerging from a since 2012, as investors sought alter- the US economy is unhealthy,’ and I growth and infl ation little changed. Fed A measure of core infl ation that ex- normal monetary policy environment.” correction. natives to more than $8tn in negative- immediately have to remind them that Chair Janet Yellen cited the risk posed cludes volatile food and fuel costs rose The latest drop in yields will test in- On Wednesday, the Fed sig- yielding sovereign debt worldwide. we are nowhere near a recession,” said by next week’s Brexit vote as one reason in May at a 2.2% annual rate, accord- vestor demand when the Treasury is- nalled a cautious approach to Concern ahead of the UK’s June 23 vote Torsten Slok, chief international econ- to stand pat. Benchmark 10-year Treas- ing to Labor Department data released sues $88bn of fi xed-rate notes in three further raising borrowing costs, on whether to remain in the European omist at Deutsche Bank in New York. ury yields fell three basis points, or 0.03 June 16. auctions next week. Elevated demand with fi ve more offi cials seeing Union also boosted haven demand. US “I tell them that 50% of Treasuries percentage point, last week to 1.61% The Fed targets a 2% infl ation rate for US securities left primary dealers, only one rate increase this year yields declined even as US growth esti- are held by foreigners, who look in their in New York Friday, data compiled by based on a separate gauge. The Atlanta which are obligated to bid at debt sales, compared with the previous mates rose and data signalled an uptick own backyard and see nothing but neg- Bloomberg show, a third straight week- Fed on Friday said its model for gross with record-low awards at a pair of forecasting round in March. in infl ation. ative rates, so even US yields at 1.60% ly decline. The price of the 1.625% se- domestic product projected a 2.8% note sales last month.

SPOTLIGHT ON COMMODITIES Looming Brexit vote to cast shadow over market activity

By Ole Hansen elevated ahead and in the case of Leave, such as precious metals. Demand for back above $1,300/oz is required in order fell. These developments were drowned afterwards too. exchange-traded products backed by gold to change sentiment back to bullish from out by the need to reduce risk and signs Corn remains supported by the outlook and silver remain strong. consolidation. that supply disruptions from Canada is Market activity has increasingly been for dry weather and a “flash drought” this Even during the correction in May The multi-week crude rally ran has fading while Iran has managed to increase dictated or distracted by the uncertainty summer. Wheat, meanwhile, has reversed demand continued to climb. Tactical trad- run out of steam following the failure to production and exports much faster than surrounding the UK referendum vote on most of the gains from early June on a ers using futures were the main culprits gain a firm foothold above $50/b. Raised expected. June 23. Opinion polls indicating rising strong US harvest and the emergence of behind the May selling where hedge funds uncertainty related to the UK referendum Demand growth, especially for diesel in support for the Leave camp sent investors a big crop in Australia. Wheat’s premium reduced bullish bets on gold by one third. on June 23 combined with the oil market India, have been very strong this year but looking for cover with stocks falling and over corn (new crop for December deliv- With the sharp reversal seen this month, being increasingly overbought helped according to Reuters this could change bonds rising. ery) has as a consequence collapsed to they have been busy rebuilding long posi- send it lower. over the coming months. Drought during This was followed on Wednesday by a just $70 from an average of $112 during tions and during the week ending June 7 Following a week-long selloff crude oil the past year has increased demand for distinctively dovish statement following the past six months. they added 20%. managed to find support after retracing diesel for irrigation pumps and genera- the latest Federal Open Market Committee Gold has experienced a strong rebound The big question remains what kind 61.8% of the supply disrupted rally seen tors. But with the monsoon expected to meeting. The FOMC lowered its projec- this month, not least after the FOMC’s of impact the vote will have on the yel- during May. Oil was hurt, not by worsening dump above average rainfall, this demand tion of its own interest rate path with six attempt to introduce a more hawkish low metal. We view the risk/reward as fundamentals but by the need from specu- may now fade and once again turn India members now only seeing one rate hike mindset in the market was quashed. The being skewed to the upside. A vote to lative traders to reduce a near-record into a net exporter of diesel. in 2016. weaker-than-expected US jobs report leave the European Union would almost exposure during a week where investment Supply disruption risks in Nigeria, Libya Commodities got caught up in these on June 3 sent rate expectations lower certainly ensure a prolonged period of sentiment was hurt by Brexit worries. and Venezuela will continue to support developments with the risk-off sentiment reached a new record while hedge funds once again and this was followed up on uncertainty where stocks could suff er The monthly Oil Market Report from the rebalancing process. US producers helping send the Bloomberg Commodity trading gold futures continued to increase Wednesday with the above mentioned do- and bonds continue to be sought. It might the International Energy Agency released meanwhile will need oil well above $50 Index (BCOM) lower for the first time in bullish bets following a one-third reduc- vish outcome of the latest FOMC meeting. also support the dollar thereby creating on June 14 said that the global oil market for an extended period of several months six weeks. tion during May. While equities have suff ered, sovereign some headwind, but given the negative would almost balance next year with before it will begin having an impact on Oil was especially hurt, not by worsen- The tragic murder of Jo Cox, a Labour bond yields have continued to contract correlation we see an increased risk that demand continuing to rise faster than reversing the production decline. ing fundamentals but by the need from member of the UK parliament and a with the yield on German 10-year bunds gold could be propelled towards $1,400, production. We maintain the view that crude oil speculative traders to reduce a near- Remain supporter helped trigger a being the latest to hit zero earlier this the 2014 high. It did, however, also say that the will be trading within a $45 to a low $50’s record exposure following the failure to strong market reversal led by a weaker week. Once the dust settles after the ref- A Remain result would initially trigger a “enormous inventory overhang” would range over the coming months. The big- gain a foothold above $50/barrel. dollar. There is no doubt that the UK erendum investors will be still be left with major relief rally across global stocks but take time to clear and should limit any gest uncertainty right now is the UK refer- Gold and silver meanwhile spiked with referendum on June 23 is one of the most a world where positive yielding bonds with the dollar also likely to weaken and significant increase in prices. endum and the impact a potential Leave the yellow metal hitting a near two-year important events in the UK – and for that continue to disappear. with global bond yields remaining com- The weekly US inventory report was will have on the speculative positioning. high on continued demand from both matter Europe – in a generation. With the This combined with a dovish outlook pressed we see the downside risk limited. generally price friendly with production paper and physical metals investors. Hold- outcome too close to call, volatility across from the FOMC will in our opinion con- Gold will be looking for support reversing gains from the previous week „ Ole Hansen is head of commodity ings of silver in exchange-traded funds markets and asset classes will remain tinue to support alternative investments between $1,271 and $1,258 with a break while both crude and gasoline inventories strategy at Saxo Bank. Gulf Times 6 Monday, June 20, 2016 BUSINESS

SAUDI ARABIA KUWAIT OMAN

Company Name Lt Price % Chg Volume Company Name Lt Price % Chg Volume Company Name Lt Price % Chg Volume

Saudi Re For Cooperative Rei 6.37 1.92 1,544,479 Boubyan Intl Industries Hold 31.50 8.62 6,536,279 Areej Vegetable Oils 3.68 0.00 - Solidarity Saudi Takaful Co 9.87 0.00 - Gulf Investment House Ksc 27.00 0.00 1,865,190 Aloula Co 0.53 0.00 - Amana Cooperative Insurance 9.35 0.00 897,352 Boubyan Bank K.S.C 395.00 0.00 70,706 Al-Omaniya Financial Service 0.30 0.00 - Alabdullatif Industrial Inv 17.95 -0.22 381,830 Ahli United Bank B.S.C 192.00 1.05 46,108 Al-Hassan Engineering Co 0.08 0.00 - Saudi Printing & Packaging C 19.76 0.36 279,973 Osos Holding Group Co 110.00 3.77 459,660 Al-Fajar Al-Alamia Co 0.75 0.00 - Sanad Cooperative Insurance 15.23 0.00 - Al-Eid Food Ksc 98.00 0.00 7,000 Al-Anwar Ceramic Tiles Co 0.27 0.00 - Saudi Paper Manufacturing Co 12.38 0.81 777,985 Qurain Petrochemical Industr 206.00 0.00 96,529 Al Suwadi Power 0.22 0.00 - Alinma Bank 13.37 -0.07 35,317,813 Advanced Technology Co 0.00 0.00 - Al Shurooq Inv Ser 1.04 0.00 - Almarai Co 54.25 0.07 53,325 Ekttitab Holding Co Sak 37.00 1.37 828,636 Al Sharqiya Invest Holding 0.14 -2.16 31,000 Falcom Saudi Equity Etf 25.40 -1.17 290,714 Kout Food Group Ksc 0.00 0.00 - Al Maha Petroleum Products M 1.50 0.00 - QATAR United International Transpo 36.49 -0.27 36,655 Real Estate Trade Centers Co 21.00 13.51 27,000 Al Maha Ceramics Co Saoc 0.45 0.00 1,718 Hsbc Amanah Saudi 20 Etf 24.75 0.00 - Acico Industries Co Kscc 295.00 -3.28 13,010 Al Madina Takaful Co Saoc 0.07 0.00 - Company Name Lt Price % Chg Volume Saudi International Petroche 13.90 0.58 251,077 Kipco Asset Management Co 79.00 0.00 33,966 Al Madina Investment Co 0.06 0.00 110,000 Falcom Petrochemical Etf 21.70 0.00 100 National Petroleum Services 730.00 0.00 3,281 Al Kamil Power Co 0.31 0.00 - Zad Holding Co 83.50 0.00 8 Saudi United Cooperative Ins 13.25 0.45 343,154 Alimtiaz Investment Co Kscc 69.00 0.00 4,500 Al Jazerah Services -Pfd 0.55 0.00 - Widam Food Co 60.80 -0.65 3,361 Bank Al-Jazira 12.80 0.23 1,719,362 Ras Al Khaimah White Cement 91.00 -3.19 152,151 Al Jazeera Steel Products Co 0.21 0.97 120,439 Vodafone Qatar 10.53 0.29 304,316 Al Rajhi Bank 58.06 -0.57 2,148,857 Kuwait Reinsurance Co Ksc 190.00 0.00 60,267 Al Jazeera Services 0.22 0.00 - United Development Co 19.05 0.79 42,526 Samba Financial Group 20.65 -0.43 130,344 Kuwait & Gulf Link Transport 47.50 0.00 50,800 Al Izz Islamic Bank 0.06 0.00 421,344 Salam International Investme 11.21 -0.71 37,129 United Electronics Co 26.90 -0.19 138,712 Human Soft Holding Co Ksc 1,440.00 0.00 127,400 Al Buraimi Hotel 0.88 0.00 - Qatar & Oman Investment Co 11.00 0.92 32,870 Allied Cooperative Insurance 14.60 -1.68 457,920 Automated Systems Co Kscc 390.00 1.30 307,500 Al Batinah Power 0.21 0.00 - Qatar Navigation 85.90 0.47 17,872 Malath Cooperative & Reinsur 15.01 -0.20 500,425 Metal & Recycling Co 59.00 0.00 5,000 Al Batinah Hotels 1.13 0.00 - Qatar National Cement Co 85.00 0.00 673 Alinma Tokio Marine 18.89 -0.58 689,454 Gulf Franchising Holding Co 34.00 0.00 500 Al Batinah Dev & Inv 0.09 0.00 - Qatar National Bank 138.50 0.95 47,901 Arabian Shield Cooperative 23.06 -0.22 38,172 Al-Enma’a Real Estate Co 51.00 0.00 2,660,000 Al Anwar Holdings Saog 0.19 -1.07 70,867 Qatar Islamic Insurance 58.00 -1.69 1,006 Savola 36.63 -0.62 406,940 National Mobile Telecommuni 1,180.00 3.51 228 Ahli Bank 0.17 0.00 - Qatar Industrial Manufactur 41.00 0.99 404 Wafrah For Industry And Deve 25.91 1.85 420,061 Al Bareeq Holding Co Kscc 0.00 0.00 - Acwa Power Barka Saog 0.70 0.00 - Qatar International Islamic 61.60 -0.48 7,300 Fitaihi Holding Group 15.99 0.88 256,678 Housing Finance Co Sak 31.50 1.61 1,885,978 Abrasives Manufacturing Co S 0.05 0.00 - Qatari Investors Group 47.60 0.42 27,300 Tourism Enterprise Co/ Shams 34.22 1.39 337,703 Al Salam Group Holding Co 41.00 0.00 6,684,447 A’saff a Foods Saog 0.86 0.00 - Qatar Islamic Bank 95.50 -1.04 278,795 Sahara Petrochemical Co 10.63 -0.19 1,235,626 United Foodstuff Industries 0.00 0.00 - 0Man Oil Marketing Co-Pref 0.25 0.00 - Qatar Gas Transport(Nakilat) 23.18 0.13 65,948 Herfy Food Services Co 79.50 0.08 8,962 Al Aman Investment Company 49.50 -1.00 686,885 Qatar General Insurance & Re 48.80 0.00 - Mashaer Holdings Co Ksc 0.00 0.00 - Qatar German Co For Medical 11.45 0.44 10,679 Manazel Holding 15.00 0.00 3,081,352 Qatar Fuel Qsc 151.60 -0.20 17,660 Mushrif Trading & Contractin 67.00 1.52 49,520 Qatar First Bank 11.65 0.09 345,168 KUWAIT Tijara And Real Estate Inves 0.00 0.00 - Qatar Electricity & Water Co 200.90 0.85 1,901 Kuwait Building Materials 250.00 0.00 115,500 Qatar Cinema & Film Distrib 32.50 0.00 - Company Name Lt Price % Chg Volume Jazeera Airways Co Ksc 910.00 1.11 31,557 Qatar Insurance Co 72.00 0.70 33,712 Commercial Real Estate Co 76.00 1.33 578,850 Ooredoo Qsc 90.00 1.12 121,136 Securities Group Co 82.00 0.00 14,806 Future Communications Co 100.00 0.00 10,000 National Leasing 17.90 0.28 265,290 Sultan Center Food Products 59.00 0.00 60,315 National International Co 57.00 0.00 20,250 Mazaya Qatar Real Estate Dev 13.30 -1.26 38,276 Kuwait Foundry Co Sak 188.00 5.62 492,205 Taameer Real Estate Invest C 23.00 4.55 52,000 UAE Mesaieed Petrochemical Holdi 18.91 0.59 149,170 Kuwait Financial Centre Sak 86.00 1.18 28,000 Gulf Cement Co 77.00 5.48 300,298 Al Meera Consumer Goods Co 206.00 -0.96 3,653 Ajial Real Estate Entmt 138.00 0.00 1,000 Heavy Engineering And Ship B 164.00 5.13 678,721 Company Name Lt Price % Chg Volume Medicare Group 94.10 -0.32 3,884 Gulf Glass Manuf Co -Kscc 285.00 0.00 800 Refrigeration Industries & S 305.00 0.00 44,000 Mannai Corporation Qsc 87.70 -2.34 292 Kuwait Finance & Investment 39.00 5.41 551,000 National Real Estate Co 89.00 1.14 671,000 Waha Capital Pjsc 1.99 -1.00 1,173,665 Masraf Al Rayan 33.60 0.00 - National Industries Co Ksc 210.00 -0.94 3,000 Al Safat Energy Holding Comp 0.00 0.00 - United Insurance Company 2.00 0.00 - Al Khalij Commercial Bank 16.11 0.06 188 Kuwait Real Estate Holding C 25.50 2.00 1 Kuwait National Cinema Co 1,700.00 0.00 200 United Arab Bank Pjsc 2.57 0.00 - Industries Qatar 99.00 0.10 24,966 Securities House/The 40.50 0.00 3,270,857 Danah Alsafat Foodstuff Co 124.00 0.00 2,431,004 Union National Bank/Abu Dhab 3.84 6.96 6,663,294 Islamic Holding Group 61.00 0.49 1,598 Boubyan Petrochemicals Co 510.00 2.00 1,307,591 Independent Petroleum Group 335.00 0.00 2,671 Union Insurance Co 1.43 0.00 - Gulf Warehousing Company 59.00 1.55 20,772 Al Ahli Bank Of Kuwait 335.00 1.52 258,649 Kuwait Real Estate Co Ksc 56.00 1.82 2,713,143 Union Cement Co 1.20 0.00 - Gulf International Services 37.40 0.54 212,683 Ahli United Bank (Almutahed) 405.00 1.25 231,000 Salhia Real Estate Co Ksc 360.00 0.00 2,000 Umm Al Qaiwain Cement Indust 0.85 0.00 - Ezdan Holding Group 17.60 -0.96 117,076 National Bank Of Kuwait 630.00 3.28 8,014,194 Gulf Cable & Electrical Ind 425.00 4.94 926,406 Sharjah Islamic Bank 1.56 0.65 451,042 Doha Insurance Co 19.10 -2.05 6,128 Commercial Bank Of Kuwait 430.00 2.38 36,390 Al Nawadi Holding Co Ksc 0.00 0.00 - Sharjah Insurance Company 3.85 0.00 - Doha Bank Qsc 34.90 -0.29 10,885 Kuwait International Bank 196.00 1.03 295,946 Kuwait Finance House 465.00 1.09 792,500 Sharjah Group 1.50 0.00 - Dlala Holding 20.20 0.50 17,567 Gulf Bank 236.00 4.42 4,951,500 Gulf North Africa Holding Co 36.50 7.35 412,500 Sharjah Cement & Indus Devel 0.96 0.00 - Commercial Bank Qsc 37.30 0.54 16,108 Al-Massaleh Real Estate Co 44.00 0.00 20,000 Hilal Cement Co 142.00 0.00 90 Ras Al-Khaimah National Insu 4.10 0.00 - Barwa Real Estate Co 32.30 1.25 87,498 Al Arabiya Real Estate Co 31.50 -1.56 533,000 Osoul Investment Kscc 45.50 0.00 24,351 Ras Al Khaimah White Cement 1.17 0.00 - Al Khaleej Takaful Group 24.60 -0.36 1,417 Kuwait Remal Real Estate Co 34.50 0.00 80,350 Gulf Insurance Group Ksc 700.00 0.00 250 Ras Al Khaimah Ceramics 3.27 0.62 40,000 Alkout Industrial Projects C 650.00 3.17 373 Kuwait Food Co (Americana) 2,100.00 0.00 101,145 Ras Al Khaimah Cement Co Psc 0.80 0.00 - A’ayan Real Estate Co Sak 63.00 0.00 55,000 Umm Al Qaiwain Cement Indust 0.00 0.00 - Ras Al Khaima Poultry 2.80 0.00 - Investors Holding Group Co.K 22.50 2.27 7,420,607 Aayan Leasing & Investment 36.00 1.41 7,658,720 Rak Properties 0.61 0.00 1,881,764 Al-Mazaya Holding Co 122.00 1.67 814,750 Ooredoo Qsc 81.15 0.00 - SAUDI ARABIA Al-Madar Finance & Invt Co 14.00 0.00 27,000 Oman & Emirates Inv(Emir)50% 1.17 0.00 - Gulf Petroleum Investment 42.50 -1.16 1,785,517 Nbad Oneshare Msci Uae Etf 6.26 0.00 - National Takaful Company 0.00 Company Name Lt Price % Chg Volume Mabanee Co Sakc 780.00 2.63 20 OMAN 0.98 - City Group 600.00 0.00 416,597 National Marine Dredging Co 4.91 0.00 - National Investor Co/The 0.64 0.00 - United Wire Factories Compan 24.83 6.52 419,973 Inovest Co Bsc 55.00 1.85 55,272 Company Name Lt Price % Chg Volume Etihad Etisalat Co 27.70 1.54 1,683,724 Kuwait Gypsum Manufacturing 0.00 0.00 - National Corp Tourism & Hote 4.50 0.00 - Dar Al Arkan Real Estate Dev 6.09 3.40 41,929,524 Al-Deera Holding Co 40.00 1.27 46,100 Voltamp Energy Saog 0.42 0.00 6,622 National Bank Of Umm Al Qaiw 3.15 3.28 10,000 Saudi Hollandi Bank 11.95 -0.42 92,776 Alshamel International Hold 0.00 0.00 - United Power/Energy Co- Pref 1.00 0.00 - National Bank Of Ras Al-Khai 5.10 0.00 379,807 Rabigh Refining And Petroche 11.77 0.60 544,251 Mena Real Estate Co 22.50 0.00 1,400 United Power Co Saog 3.40 0.00 - National Bank Of Fujairah 4.79 0.00 - Banque Saudi Fransi 23.55 0.00 103,229 National Slaughter House 0.00 0.00 - United Finance Co 0.15 0.00 - National Bank Of Abu Dhabi 9.20 15.00 4,216,696 Saudi Enaya Cooperative Insu 11.60 0.69 334,297 Amar Finance & Leasing Co 49.50 0.00 1,000 Ubar Hotels & Resorts 0.13 0.00 - Methaq Takaful Insurance 0.80 -1.23 502,357 Mediterranean & Gulf Insuran 20.95 -0.48 418,114 United Projects For Aviation 690.00 0.00 981 Takaful Oman 0.12 0.00 505,000 Manazel Real Estate Pjsc 0.54 -1.82 394,000 Saudi British Bank 20.68 -2.45 241,794 National Consumer Holding Co 0.00 0.00 - Taageer Finance 0.13 0.00 - Invest Bank 2.20 0.00 - Mohammad Al Mojil Group Co 12.55 0.00 - Amwal International Investme 23.00 2.22 613,700 Sweets Of Oman 1.34 0.00 - Intl Fish Farming Co Pjsc 1.55 -3.13 15,000 Red Sea Housing Services Co 26.48 1.85 55,301 Jeeran Holdings 72.00 0.00 200 Sohar Power Co 0.30 0.00 - Insurance House 0.81 0.00 - Takween Advanced Industries 24.46 1.66 1,040,532 Equipment Holding Co K.S.C.C 62.00 0.00 1,070,000 Sohar Poultry 0.21 0.00 - Gulf Pharmaceutical Ind Psc 2.24 0.00 - Sabb Takaful 25.48 -0.20 223,660 Nafais Holding 174.00 0.00 250,000 Smn Power Holding Saog 0.72 0.00 - Gulf Medical Projects 2.43 -10.00 1,000 Saudi Arabian Fertilizer Co 61.41 -1.65 604,713 Safwan Trading & Contracting 305.00 0.00 49,695 Shell Oman Marketing - Pref 1.05 0.00 - Gulf Cement Co 0.88 -2.22 164,108 National Gypsum 14.10 0.79 320,763 Arkan Al Kuwait Real Estate 90.00 0.00 5,100 Shell Oman Marketing 1.86 0.00 - Fujairah Cement Industries 1.02 0.00 - Saudi Ceramic Co 37.38 -0.03 168,096 Gfh Financial Group Bsc 69.00 -1.43 390,500 Sharqiyah Desalination Co Sa 4.70 0.00 - Fujairah Building Industries 1.14 0.00 - National Gas & Industrializa 27.38 3.48 2,420,039 Energy House Holding Co Kscp 52.00 0.00 143,225 Sembcorp Salalah Power & Wat 0.25 0.00 - Foodco Holding Pjsc 4.01 0.00 - Saudi Pharmaceutical Industr 36.90 0.22 118,248 Kuwait Slaughter House Co 0.00 0.00 - Salalah Port Services 0.65 0.00 - First Gulf Bank 13.10 11.49 12,960,445 Thimar 32.02 0.69 229,259 Kuwait Co For Process Plant 178.00 0.00 1,200 Salalah Mills Co 1.48 0.00 - Finance House 1.81 -0.55 104,000 National Industrialization C 12.93 1.81 1,344,979 Al Maidan Dental Clinic Co K 0.00 0.00 - Salalah Beach Resort Saog 1.38 0.00 - Eshraq Properties Co Pjsc 0.78 0.00 7,782,097 Saudi Transport And Investme 52.88 1.34 420,833 National Ranges Company 26.00 1.96 10,338,918 Sahara Hospitality 2.50 0.00 - Emirates Telecom Group Co 18.75 0.00 528,609 Saudi Electricity Co 20.27 -2.36 9,237,656 Al-Themar Real International 0.00 0.00 - Renaissance Services Saog 0.30 0.00 60,000 Emirates Insurance Co. (Psc) 6.05 0.00 - Saudi Arabia Refineries Co 35.39 3.87 697,487 Al-Ahleia Insurance Co Sakp 475.00 0.00 10,000 Raysut Cement Co 1.32 0.00 - Emirates Driving Company 7.00 1.45 20,000 Arriyadh Development Company 17.86 0.34 100,105 Wethaq Takaful Insurance Co 31.00 -1.59 14,209 Port Service Corporation 0.25 0.00 5,000 Dana Gas 0.54 0.00 4,744,544 Al-Baha Development & Invest 13.50 0.00 - Salbookh Trading Co Kscp 73.00 1.39 137,490 Phoenix Power Co Saoc 0.16 1.30 433,511 Commercial Bank Internationa 1.99 0.00 - Saudi Research And Marketing 42.93 0.87 206,646 Aqar Real Estate Investments 0.00 0.00 - Packaging Co Ltd 0.53 0.00 - Bank Of Sharjah 1.26 0.80 10,000 Aldrees Petroleum And Transp 34.70 0.58 132,908 Hayat Communications 47.50 1.06 5,131 Ooredoo 0.74 0.00 - Axa Green Crescent Insurance 0.87 0.00 - Saudi Vitrified Clay Pipe Co 91.03 -0.96 31,958 Kuwait Packing Materials Mfg 0.00 0.00 - Ominvest 0.57 0.00 - Arkan Building Materials Co 0.94 6.82 16,000 Jarir Marketing Co 118.75 -0.19 12,642 Soor Fuel Marketing Co Ksc 110.00 0.00 7,458 Oman United Insurance Co 0.25 0.00 5,000 Alkhaleej Investment 1.89 0.00 - Arab National Bank 19.65 -0.25 46,220 Alargan International Real 148.00 1.37 10,500 Oman Textile Holding Co Saog 0.32 -5.88 1,000 Aldar Properties Pjsc 2.78 2.21 10,096,725 Yanbu National Petrochemical 41.60 0.10 129,139 Burgan Co For Well Drilling 100.00 2.04 500 Oman Telecommunications Co 1.61 -0.31 87,006 Al Wathba National Insurance 4.40 0.00 - Arabian Cement 49.47 -1.36 499,369 Kuwait Resorts Co Kscc 86.00 -2.27 504,166 Oman Refreshment Co 2.20 0.00 - Al Khazna Insurance Co 0.36 0.00 - Middle East Specialized Cabl 7.54 1.75 1,103,950 Oula Fuel Marketing Co 110.00 1.85 3,086 Oman Packaging 0.30 0.00 - Al Fujairah National Insuran 300.00 0.00 - Al Khaleej Training And Educ 28.07 1.67 92,767 Palms Agro Production Co 100.00 0.00 5,000 Oman Orix Leasing Co. 0.11 -1.75 12,120 Al Dhafra Insurance Co. P.S. 5.00 0.00 - Al Sagr Co-Operative Insuran 35.76 2.94 506,923 Ikarus Petroleum Industries 41.00 1.23 114,321 Oman Oil Marketing Company 1.88 0.00 - Al Buhaira National Insuranc 2.25 0.00 - Trade Union Cooperative Insu 13.69 0.07 132,630 Mubarrad Transport Co 61.00 1.67 193,532 Oman National Engineering An 0.20 0.00 - Al Ain Ahlia Ins. Co. 60.00 0.00 - Arabia Insurance Cooperative 9.82 0.20 364,372 Al Mowasat Health Care Co 200.00 0.00 95,000 Oman Investment & Finance 0.20 0.00 18,000 Agthia Group Pjsc 7.45 -0.13 10,000 Saudi Chemical Company 43.92 -0.36 86,362 Shuaiba Industrial Co 285.00 3.64 6,250 Oman Intl Marketing 0.52 0.00 - Abu Dhabi Ship Building Co 2.85 0.00 - Fawaz Abdulaziz Alhokair & C 47.50 -1.17 508,177 Hits Telecom Holding 37.50 -1.32 4,629,711 Oman Hotels & Tourism Co 0.49 0.00 - Abu Dhabi Natl Co For Buildi 0.46 -2.13 135,000 Bupa Arabia For Cooperative 141.28 0.90 16,555 First Takaful Insurance Co 50.00 0.00 2,000 Oman Foods International 0.00 0.00 - Abu Dhabi National Takaful C 5.05 0.00 - Wafa Insurance 17.42 0.06 586,069 Kuwaiti Syrian Holding Co 35.50 7.58 211,279 Oman Flour Mills 0.55 0.00 - Abu Dhabi National Insurance 2.00 0.00 - Jabal Omar Development Co 62.04 1.29 304,058 National Cleaning Company 39.50 0.00 245,550 Oman Fisheries Co 0.06 0.00 56,500 Abu Dhabi National Hotels 3.00 0.00 - Saudi Basic Industries Corp 81.80 0.41 4,336,497 Eyas For High & Technical Ed 0.00 0.00 - Oman Fiber Optics 4.57 0.00 - Abu Dhabi National Energy Co 0.54 0.00 889,133 Saudi Kayan Petrochemical Co 6.38 0.00 14,024,452 United Real Estate Company 90.00 0.00 17,614 Oman Europe Foods Industries 1.00 0.00 - Abu Dhabi Islamic Bank 3.90 4.56 3,370,759 Etihad Atheeb Telecommunicat 3.96 -0.25 1,486,433 Agility 490.00 3.16 1,978,000 Oman Education & Training In 0.16 0.00 - Co For Cooperative Insurance 94.72 1.97 183,748 Kuwait & Middle East Fin Inv 0.00 0.00 - Oman Chromite 3.64 0.00 - National Petrochemical Co 17.35 -0.29 35,869 Fujairah Cement Industries 74.00 1.37 2,055,000 Oman Chlorine 0.50 0.00 - BAHRAIN Gulf Union Cooperative Insur 11.25 -1.40 375,033 Livestock Transport & Tradng 194.00 3.19 89,316 Oman Ceramic Com 0.45 0.00 - Gulf General Cooperative Ins 15.36 -1.03 218,230 International Resorts Co 32.50 1.56 208,815 Oman Cement Co 0.47 0.00 54,467 Basic Chemical Industries 30.75 -0.58 72,884 National Industries Grp Hold 122.00 8.93 13,342,629 Oman Cables Industry 1.82 0.00 27,000 Company Name Lt Price % Chg Volume Saudi Steel Pipe Co 2.19 Marine Services Co Ksc 0.00 19.64 2,823,655 100.00 270 Oman Agricultural Dev 0.00 0.00 - Zain Bahrain Bscc 0.12 0.00 200,000 Buruj Cooperative Insurance 0.11 Warba Insurance Co 0.00 17.51 243,500 104.00 38,324 Oman & Emirates Inv(Om)50% 0.14 -0.71 20,427 United Paper Industries Bsc 0.00 0.00 - Mouwasat Medical Services Co 1.38 Kuwait United Poultry Co 0.00 129.00 1,270 178.00 659 Natl Aluminium Products 0.25 0.00 - United Gulf Investment Corp 0.00 0.00 - Southern Province Cement Co -1.13 First Dubai Real Estate Deve 2.99 74.16 17,896 69.00 452,955 National Securities 0.17 0.00 - United Gulf Bank 0.37 0.00 12,666 Maadaniyah 6.51 Al Arabi Group Holding Co 0.00 27.14 1,472,412 58.00 39,700 National Real Estate Develop 5.00 0.00 - Trafco Group Bsc 0.23 -1.71 40,000 Yamama Cement Co 0.07 Kuwait Hotels Sak 0.00 27.00 465,458 0.00 - National Pharmaceutical 0.11 0.00 - Takaful International Co 0.00 0.00 - Jazan Development Co 0.17 Mobile Telecommunications Co 0.00 11.91 604,844 345.00 2,871,143 National Mineral Water 0.06 0.00 - Taib Bank -$Us 0.00 0.00 - Zamil Industrial Investment 0.36 Al Safat Real Estate Co 0.00 27.80 162,167 0.00 - National Hospitality Institu 0.53 0.00 - Seef Properties 0.19 0.00 5,220,468 Alujain Corporation (Alco) -0.08 Tamdeen Real Estate Co Ksc 10.00 13.14 315,389 550.00 3,944 National Gas Co 0.52 -0.38 72,951 Securities & Investment Co 0.00 0.00 - Tabuk Agricultural Developme 0.96 Al Mudon Intl Real Estate Co 0.00 11.60 2,010,201 28.50 4,285,750 National Finance Co 0.14 0.00 - National Hotels Co 0.00 0.00 - United Co-Operative Assuranc -1.44 Kuwait Cement Co Ksc 4.00 10.94 401,825 390.00 20,000 National Detergent Co Saog 0.65 0.00 - National Bank Of Bahrain Bsc 0.60 0.00 16,367 Qassim Cement/The 0.63 Sharjah Cement & Indus Devel 0.00 63.90 32,863 79.00 90,000 National Biscuit Industries 3.75 0.00 - Nass Corp Bsc 0.10 0.00 981,047 Saudi Advanced Industries 1.10 Kuwait Portland Cement Co -1.00 11.07 718,665 990.00 81,500 National Bank Of Oman Saog 0.25 0.00 - Khaleeji Commercial Bank 0.06 0.00 401,081 Kingdom Holding Co 0.99 Educational Holding Group 0.00 11.20 1,360,702 190.00 10 Muscat Thread Mills Co 0.11 0.00 - Ithmaar Bank Bsc 0.12 -7.69 4,250,000 Saudi Arabian Amiantit Co -0.25 Bahrain Kuwait Insurance 0.00 8.08 795,580 0.00 - Muscat National Holding 1.80 0.00 - Investcorp Bank -$Us 6.50 0.00 37,000 Al Jouf Agriculture Developm 0.07 Asiya Capital Investments Co 0.00 29.24 39,725 0.00 - Muscat Gases Company Saog 0.75 0.00 - Inovest Co Bsc 0.00 0.00 - Saudi Industrial Development 1.04 Kuwait Investment Co -1.18 9.70 426,815 84.00 253,447 Muscat Finance 0.12 0.00 - Gulf Monetary Group 0.00 0.00 - Bishah Agriculture 0.00 Burgan Bank 3.28 69.75 - 315.00 627,215 Majan Glass Company 0.19 0.00 - Gulf Hotel Group B.S.C 0.65 0.00 60,111 Riyad Bank 0.00 Kuwait Projects Co Holdings 2.00 11.00 317,605 510.00 921,687 Majan College 0.51 0.00 2,000 Gfh Financial Group Bsc 0.22 0.00 30,000 The National Agriculture Dev 0.47 Al Madina For Finance And In -5.10 21.53 239,611 46.50 5,163,600 Hsbc Bank Oman 0.10 -0.99 2,734,191 Esterad Investment Co B.S.C. 0.19 0.00 24,102 Halwani Bros Co 0.68 Kuwait Insurance Co 0.00 62.00 21,672 300.00 887 Hotels Management Co Interna 1.25 0.00 - Delmon Poultry Co 0.00 0.00 - Arabian Pipes Co 0.91 Al Masaken Intl Real Estate 0.00 10.00 927,549 71.00 309,400 Gulf Stone 0.11 0.00 - Bmmi Bsc 0.82 0.00 11,000 Eastern Province Cement Co 0.10 Intl Financial Advisors 1.69 30.12 85,629 30.00 3,241,540 Gulf Plastic Industries Co 0.39 0.00 - Bmb Investment Bank 0.00 0.00 - Al Qassim Agricultural Co 0.80 First Investment Co Kscc 5.26 10.02 751,935 50.00 639,000 Gulf Mushroom Company 0.34 0.00 - Bbk Bsc 0.33 0.00 139,033 Filing & Packing Materials M 9.90 Al Mal In 8.77 43.50 1,466,146 vestment Company 31.00 1,970,363 Gulf Investments Services 0.12 -0.86 50,000 Bankmuscat Saog 0.00 0.00 - Saudi Cable Co 0.28 2.90 7.24 869,169 Bayan Investment Co Kscc 35.50 1,594,762 Gulf Invest. Serv. Pref-Shar 0.11 0.00 - Banader Hotels Co 0.07 0.00 48,308 Tihama Advertising & Public 0.12 5.26 33.20 335,886 Egypt Kuwait Holding Co Sae 120.00 171,000 Gulf International Chemicals 0.25 0.40 55,530 Bahrain Tourism Co ` 0.00 - Saudi Investment Bank/The -1.19 5.95 12.45 258,975 Coast Investment Development 44.50 846,495 Gulf Hotels (Oman) Co Ltd 10.50 0.00 - Bahrain Telecom Co 0.31 0.00 4,263,000 Astra Industrial Group 1.14 0.00 16.03 1,134,403 Privatization Holding Compan 47.50 554,280 Global Fin Investment 0.14 0.00 - Bahrain Ship Repair & Engin 0.00 0.00 - Saudi Public Transport Co 1.89 0.00 14.03 1,058,727 Kuwait Medical Services Co 0.00 - Galfar Engineering&Contract 0.11 0.00 236,580 Bahrain National Holding 0.42 0.00 743,902 Taiba Holding Co 1.34 1.37 34.15 137,105 Injazzat Real State Company 74.00 8,690 Galfar Engineering -Prefer 0.39 0.00 - Bahrain Kuwait Insurance 0.00 0.00 - Saudi Industrial Export Co 0.57 -8.00 40.35 916,403 Kuwait Cable Vision Sak 23.00 2 Financial Services Co. 0.17 0.00 - Bahrain Islamic Bank 0.12 0.00 35,610 Saudi Real Estate Co -0.36 0.00 19.35 101,694 Sanam Real Estate Co Kscc 32.00 2,030,000 Financial Corp/The 0.11 0.00 - Bahrain Flour Mills Co 0.00 0.00 - Saudia Dairy & Foodstuff Co 0.17 0.00 152.75 3,829 Ithmaar Bank Bsc 37.50 2,247,049 Dhofar University 1.49 0.00 - Bahrain Family Leisure Co 0.00 0.00 - National Shipping Co Of/The -3.76 0.97 40.41 2,791,414 Aviation Lease And Finance C 208.00 95,147 Dhofar Tourism 0.49 0.00 - Bahrain Duty Free Complex 0.78 0.00 125,000 Methanol Chemicals Co 2.19 3.13 6.99 618,119 Arzan Financial Group For Fi 33.00 177,100 Dhofar Poultry 0.18 0.00 - Bahrain Commercial Facilitie 0.69 0.00 44,600 Ace Arabia Cooperative Insur -3.73 0.00 38.45 253,150 Ajwan Gulf Real Estate Co 26.50 52,500 Dhofar Intl Development 0.40 0.00 - Bahrain Cinema Co 1.00 0.00 22,086 Mobile Telecommunications Co 0.25 1.25 8.01 1,503,075 Kuwait Business Town Real Es 40.50 1,275,432 Dhofar Insurance 0.21 0.00 - Bahrain Car Park Co 0.00 0.00 - Saudi Arabian Coop Ins Co -0.07 0.00 15.08 260,711 Future Kid Entertainment And 112.00 5,000 Dhofar Fisheries & Food Indu 1.28 0.00 - Arab Insurance Group(Bsc)-$ 0.00 0.00 - Axa Cooperative Insurance 0.13 0.00 15.88 319,762 Specialities Group Holding C 76.00 50 Dhofar Cattlefeed 0.23 0.00 - Arab Banking Corp Bsc-$Us 0.38 0.00 3,767,620 Alsorayai Group 1.73 2.17 11.15 516,854 Abyaar Real Eastate Developm 23.50 2,439,600 Dhofar Beverages Co 0.26 0.00 - Aluminium Bahrain Bsc 0.28 0.00 1,475,453 Weqaya For Takaful Insurance 0.00 0.00 19.39 - Dar Al Thuraya Real Estate C 158.00 100 Construction Materials Ind 0.03 -3.13 95,962 Albaraka Banking Group 0.45 0.00 1,980,143 Bank Albilad 0.00 0.00 18.14 272,728 Al-Dar National Real Estate 11.00 9,165,068 Computer Stationery Inds 0.26 0.00 - Al-Salam Bank 0.09 0.00 30,800 Al-Hassan G.I. Shaker Co 1.08 0.00 25.20 70,657 Kgl Logistics Company Kscc 79.00 945,094 Bankmuscat Saog 0.39 0.51 45,000 Al-Ahlia Insurance Co 0.27 0.00 189,724 Wataniya Insurance Co -0.22 0.00 46.34 349,063 Combined Group Contracting 780.00 9,970 Bank Sohar 0.18 0.57 1,295,725 Ahli United Bank B.S.C 0.64 -0.78 40,000 Abdullah Al Othaim Markets 100.00 -0.02 15,453 Zima Holding Co Ksc 41.50 1.22 1,355,426 Bank Nizwa 0.08 0.00 379,198 Hail Cement 12.51 0.32 182,527 Qurain Holding Co 0.00 0.00 - Bank Dhofar Saog 0.23 0.00 - LATEST MARKET CLOSING FIGURES

Gulf Times 10 Monday, June 20, 2016 BUSINESS

Sun Valley More challenges ahead for Ford’s showdown looms for crown jewel, F-150, after overhaul Redstone, Bloomberg effi ciency.” GM — which is bashing Chicago the durability of F-150 aluminium beds in new ads — will be forced to Dauman join Ford in using more aluminium ord Motor Co executives to save weight in components in- spared no expense in over- cluding engine blocks, transmis- Bloomberg Fhauling the crown jewel of sion cases, fenders and doors, Los Angeles their empire, the F-150. They gave said Mark Stevens, a retired GM the truck a new aluminum body, vice-president for engineering and smaller turbocharged engines and manufacturing. Sparks might fly at this year’s annual Allen & a lighter and stronger steel frame — The new technologies save fuel Co conference in Sun Valley, Idaho, where both all with an eye to appease US regu- but add thousands in consumer Viacom rivals Shari Redstone and Philippe lators demanding cleaner vehicles. costs, including for features such as Dauman, chief executive off icer of the media The initiative took six years and cost 360-degree cameras. Between 2011 conglomerate, are on the guest list. Ford more than $1bn. and May 2016, the average price of Shari Redstone, along with her father Viacom The problem, though, is that full- size pickups jumped 24% — al- chairman Sumner Redstone, have been locked some versions of the new F-150 still most triple the pace for all new ve- in a public battle against Dauman over the fate don’t meet the government’s 2016 hicles — to $41,606, according to JD of a company that owns MTV and Nickelodeon. emission and fuel-economy man- Power & Associates. Shari’s 93-year-old father isn’t well and is being dates. What’s more, the hurdles get Regulators measure fuel economy manipulated by his daughter, Dauman has higher from here: By 2025, the tar- and emissions by setting separate said. Both rivals are on a list of invitees seen by gets will be much more stringent. car and truck targets for each size Bloomberg News. The stakes for Ford couldn’t be vehicle, then using sales-weighted Shari Redstone and Dauman had yet to confirm greater. Ford’s F-Series, America’s formulas to determine a corpo- their attendance at the annual Sun Valley best-selling truck line, accounts for rate average. They give credits for event, which draws top executives from the 31% of the company’s North Ameri- eco-friendly technologies, includ- entertainment, sports, media and technology can sales and half of its profi t in the ing aerodynamic design, then fi ne industries together with some of Hollywood’s region, according to Barclays ana- companies whose fuel-economy most powerful celebrities for discussions and, in lyst Brian Johnson. average is still too low. some cases, dealmaking. In weeks leading up to Ford is trying to safeguard this Detroit faces an uphill battle for the summit, the Redstones, Dauman, and other profi t centre as global regulators pickup relief because it already ex- Viacom board members, have been in courtroom push harder than ever for clean air. tracted a huge compromise: Obama battles from Massachusetts to California over In the past year, Volkswagen, Mit- agreed in 2011 to keep SuperCab- control of the media company’s future. subishi Motors Corp and Suzuki size truck mandates relatively fl at Dauman, formerly a Sumner Redstone Motor Corp admitted to manipu- for a decade and then accelerate confidante within the company, has lost the lating emissions and fuel-econo- them as fast as those for cars. support of the chairman, who is also the my tests. Hyundai Motor Co, Kia Automakers now want more controlling shareholder. The CEO is supporting Motors Corp and Ford have had to A row of Ford Motor’s F-150 trucks are displayed at a dealership in Louisville, Kentucky. Ford’s F-Series, America’s time to reach the 2025 targets, even a plan to sell a stake in the company’s apologise for misstating fuel econ- best-selling truck line, accounts for 31% of the company’s North American sales and half of its profit in the region. if they can’t change the direction Paramount Pictures unit, a move Redstone has omy on window stickers. regulators are heading. Within nine signalled he opposes. The chairman recently “Not meeting the standards is SuperCab-size trucks will have increase in the corporate average surge and now need to push manu- years, the US, European Union, changed Viacom bylaws to prohibit any action not really an option, especially on jumped by a third to 33.3 and the fuel-economy requirement — to facturers to equip them with the China and Japan are scheduled to involving Paramount without unanimous your most profi table product,” said CO2 limit will fall by the same per- 54.5 mpg in 2025 from 35.5 in 2016. same fuel-saving technologies as require fuel economy of 45.9 mpg approval of the board on which he and his Gopal Duleep, president of H-D centage. The fuel-economy num- He also mandated a cut in average cars, including aerodynamic de- or more and CO2 emissions of 122 daughter sit. Systems, a Washington research bers refer to test results; real-world greenhouse-gas emissions to 163 signs and more gas-electric hy- grams per kilometre or less. Hitting The retreat, usually shrouded in secrecy, company. “On fuel economy, the driving and window-sticker dis- grams of CO2 per mile from 250. brids, especially in small trucks the CO2 target in the US means a takes place in early July. This year’s invitees regulators allow you to pay a fi ne if plays can be 20% lower. The fi rst step in the evaluation is used for personal transportation. 53% reduction since 2000, accord- include Apple’s Tim Cook, Facebook’s Mark you fall short. But on greenhouse Detroit automakers don’t know a technology assessment the En- Sergio Marchionne, chief execu- ing to the International Council on Zuckerberg and Walt Disney’s Bob Iger, all gas, they don’t. You either meet the if they can comply with the regula- vironmental Protection Agency, tive offi cer of Fiat Chrysler Auto- Clean Transportation. frequent attendees of the event. Other Disney standard or they shut you down.” tions at an acceptable cost to cus- National Highway Traffi c Safety mobiles, has said his 2018 model Automakers also are pressing figures are on the list including former COO Cutting fuel consumption re- tomers and shareholders, according Administration and California Air Ram will save fuel with a bigger US regulators to expand credits for Tom Staggs and board member Maria Elena duces greenhouse gases, so Ford to people familiar with the situa- Resources Board are scheduled to battery that lets the engine shut off eco-friendly technologies, the peo- Lagomasino. James Murdoch, CEO of 21st and other manufacturers are racing tion. publish this month. at stoplights ple familiar with the situation say. Century Fox is on the list along with his father to incorporate new technologies in “The question is, do consumers Progress on clean air has stalled Thirty percent of Ford’s F-150s These include more for self-driving Rupert and brother Lachlan. Oprah Winfrey their pickups, including gas-elec- pay for this technology or just get because low gasoline prices boosted already have this type of battery, vehicles, which could save fuel by and Jerry Seinfeld are also invited. Seinfeld will tric hybrids and 10-speed trans- it for free?” said Warren Gibbon, a the popularity of pickups, minivans and the share will rise to 60% next improving traffi c fl ow, and for big not attend, said a spokesman for the comedian. missions. They also may plead for portfolio manager for Standard Life and sport utility vehicles, which year. By 2020, Ford will have a hy- vans like Ford’s Transit, which can Winfrey’s spokesman could not be reached relief during a so-called midterm Investments in Boston, who helps tend to pollute more than cars. As brid pickup with batteries powerful haul a dozen or more passengers. immediately for comment. evaluation of the US requirements manage $373bn and sold his hold- a result, average greenhouse-gas enough for daily driving, CEO Mark Regulators express limited appe- The event, traditionally heavy on executives from beginning this month. Just retool- ings in big Detroit car companies emissions from new models were Fields has said. tite for more compromise. media and entertainment, has leaned toward ing the factories that produce the in 2012. “If it’s the latter, it will be six percentage points higher in Ford also is testing a diesel-pow- “Increased fuel effi ciency costs technology in recent years and has become F-150 cost $1.2bn, according to Ford tough for automakers to make a March than in August 2014, and the ered F-150, according to a video consumers much less than the sav- recognised as a potential hotbed of deal making, spokesman Mike Levine. good return on their investment.” fuel economy of models sold in May posted on Autoblog.com, and may ings they get over the life of the such as the 2013 sale of the Washington Post to Ford is scrambling because about Concerns about the standards — was down 0.4 mpg from the same add a 4-cylinder engine for the vehicle,” said Dan Sperling, a Cali- Amazon.com founder Jeff Bezos. 40% of its new aluminium-body and the head start Alphabet’s Goog- month, according to the University fi rst time in the US, a person fa- fornia air-board member and pro- There are also representatives from sport that F-150s don’t comply with the 2016 le unit has grabbed in technologies of Michigan Transportation Re- miliar with the plans said. That fessor of civil engineering and envi- could turn up including Major League Baseball mandates, according to Duleep. such as self-driving — have helped search Institute. may be a hard sell on the farms and ronmental science at the University commissioner Robert Manfred, Lawrence The four-wheel-drive, 3.5-litre Su- depress auto stocks. While F-Series Pickups face inherent disadvan- construction sites where Ford has of California at Davis. In 2012, the Probst, chairman of the US Olympic Committee perCab — a high-volume variation sales have risen this year and Ford tages: Towing, payload and off -road championed big, powerful V-8s for EPA and NHTSA projected buy- and Casey Wasserman, who heads the sports — falls 1 mile per gallon short and reported record profi ts, its shares capabilities customers want mean decades. ers would spend $1,800 to meet agency Wasserman Media Group, and has emits 15 grams of CO2 per mile more fell 8% through June 15. General they weigh 12% to 15% more than “Every upgrade we made to the new standards but save at least advocated for the city of Los Angeles to host than allowed, he said. Motors Co sagged 15% and Toyota comparable cars, plus they have the F-150 is to improve how custom- $5,700 on gasoline during their ve- the 2024 summer Olympics. Since most two-wheel-drive Motor Corp dropped 27%. aerodynamic effi ciency of bricks, ers use their truck,” Ford’s Levine hicle’s lifetime. Allen & Co was founded in the 1920s by models with smaller engines do All this increases the importance Duleep said. said. “Lighter materials help F-150 “This is one of the smartest and brothers Herb and Charles Allen. A call to Allen comply, the F-150 programme as of the standards evaluation. Presi- Mary Nichols, chairman of the tow and haul more than any other best things our country can be do- & Co’s New York off ices was unanswered after a whole meets the targets. But by dent Barack Obama agreed to it in California board, said regulators light-duty truck, while also pro- ing for the economy and the cli- usual business hours. 2025, the MPG requirement for July 2011 when he announced a 54% were caught off guard by the truck viding best-in-class gasoline fuel mate,” Sperling said. Gulf Times Monday, June 20, 2016 11 BUSINESS Brexit battle gets bitter with polls showing ‘Leave’ holds lead

Bloomberg of the Conservative membership that are volatility have soared this month, suggest- strates a fundamental misunderstanding raising their probability of a Brexit to 45% ropean President Donald Tusk. Four days London Eurosceptic will never forgive Cameron,” ing investors are concerned, other gauges of central-bank independence,” said from 30%. “The result is on a knife edge,” before Britons vote on whether to exit the said Jon Davis, a professor at King’s Col- paint a more sanguine view. The pound Carney. The governor has previously Jacob Nell and Melanie Baker wrote in a European Union, Schaeuble — a strong lege London. “Even though the Conserva- has risen 1.6% since the end of February called an exit “the biggest domestic risk note to clients. Still, they said, “we expect advocate of the UK staying in — singled Acrimony among Britain’s political and tive Party believes in winners, this is the and bookmakers say that customers still to financial stability” and warned it could a late swing in the polls” to “Remain,” as out the Brexit as a geopolitical risk. economic elite intensified as those fight many of them wish he would lose.” have more money placed on “Remain” trigger a “technical recession.” voters opt for the safety of the status quo. Other reasons for “for the high level of campaigning to leave the European Union A survey by Ipsos MORI for the Evening than “Leave” even as they shorten the Criticism of Carney and the independ- German Finance Minister Wolfgang nervousness and volatility in the markets” held a steady lead in opinion polls with a Standard newspaper released on Thurs- odds on the likelihood of Brexit. ent BoE is “deeply concerning,” Cameron Schaeuble yesterday said EU policy include Islamist terrorism, armed conflict in week to go until the referendum. day showed 53% support for leaving with Carney has come under attack from wrote on Twitter. “We should listen to makers have safeguards in place to avoid eastern Ukraine and an “excess of liquidity A day after Chancellor of the Excheq- 47% for remain, excluding those who said pro-Brexit senior Conservatives, including experts when they warn us of the dangers “chaotic developments” should Britons and debt,” he said in a speech at the Kiel uer George Osborne was accused of they didn’t yet know. The telephone poll former leaders Michael Howard and Iain of leaving the European Union.” vote to leave the bloc. institute earlier yesterday. Those excesses economic scaremongering by supporters of 1,257 adults, the latest in a string of Duncan Smith. They accused the Bank Carney’s return to the battlefield came “Ultimately you have to wait for Britons are compounding market turmoil as cen- of a so-called Brexit, Bank of England surveys showing a steady lead for anti-EU of England and the Treasury of a “woeful after Osborne calculated leaving the EU to decide and then you have to respect tral banks reach the limits of measures to Governor Mark Carney hit back against campaigners, was conducted from June failure” to present “a fair and balanced could open a “black hole” in the nation’s the decision,” Schaeuble told reporters boost growth, according to Schaeuble. criticism he’s sacrificed his independence 11 to June 14. Another poll for IG Group analysis” of the economic consequences finances that he would need to fill with yesterday after a speech at the Institute “For many authorities, there’s still a to back the government. by Survation showed 45% for leaving and of departure. an emergency budget of tax hikes and for the World Economy in Kiel, Germany. great temptation to buy time with money Pleas from leaders of the 28-nation EU 42% for staying, with 13% undecided. The central bank governor used a let- spending cuts. That drew condemnation “But it’s also clear that then you have to do that one doesn’t have,” Schaeuble said. that Britain stay in the group and accusa- “Until this morning I would have said ter to another Brexit supporter, Bernard from 65 of his fellow Conservative law- everything possible to avoid chaotic devel- “Fiscal and monetary policy measures tions of bad faith on both sides in the UK to you that on the balance of probabili- Jenkin, to argue the BoE has been correct makers who said they would vote against opments. We are well-prepared for that.” have reached their limits.” underscored the turbulence to follow the ties, ‘Remain’ were the favourites,” John to off er its “evidence-based judgment.” any such package. If the UK left, the EU couldn’t just Schaeuble is the most prominent voice June 23 ballot whatever the result. Prime Curtice, professor of politics at Strathclyde The missive was a response to a warning Central banks including the US Federal continue with business as usual because in German Chancellor Angela Merkel’s Minister David Cameron faces a struggle University in Glasgow, told the BBC. “We from Jenkin about rules banning “any Reserve and Bank of Japan all on Thurs- “otherwise many would get the same government to question central-bank poli- to unify his Conservative Party if the UK no longer have a favourite in this referen- public comment” during a pre-referendum day cited the referendum as a factor in idea,” he said. cies, once suggesting that ECB president votes to stay, and could be cast from off ice dum. There has to be a serious possibility blackout period, which the BoE has cho- their policy choices this week. While Schaeuble didn’t elaborate, his Mario Draghi should share the blame for if his side loses. that we will vote ‘Leave’.” sen to impose on itself voluntarily. Morgan Stanley economists meanwhile comments jibe with similar assurances the rise of the Alternative for Germany “If he wins this, the roughly two-thirds While measures of short-term market Jenkin’s correspondence “demon- highlighted the closeness of the race by from other leading EU off icials such as Eu- party.

EU banking watchdog to VW is ready with $10bn diesel leave London in case of Brexit

Reuters plan; to devise fi x later: Source Berlin

Bloomberg he European Union’s Washington banking watchdog will Tmove from London to an- other European capital if Britain olkswagen will submit its $10bn decides to quit the bloc in a ref- plan this month to fi x a half mil- erendum this week, its chairman Vlion emissions-cheating cars or said in an interview published get them off US roads even though it’s yesterday. awaiting regulators’ sign-off on how to Britain votes on June 23 on retrofi t the vehicles, a person familiar whether to stay in the 28-mem- with the matter said. ber bloc, a choice with far- About $6.5bn will go to car own- reaching consequences for poli- ers and $3.5bn to the US government tics, the economy, defence and and California regulators, said the diplomacy on the continent. person, who asked not to be identi- The London-based EBA, fi ed because the deal isn’t public yet. founded in 2011 as a reaction to Because the US Environmental Pro- the global fi nancial crisis, oper- tection Agency and the California Air ates as a pan-EU regulator, writ- Resources Board haven’t approved ing and coordinating banking VW’s proposed fi xes, the deal as of rules across the bloc. now includes an option for car owners “If the British should decide to to request their vehicles be repaired, leave the EU, we actually would but there’s no timetable for doing so or have to move to another Europe- a guarantee there will be an approved an capital,” Andrea Enria, head fi x, the person said. of the European Banking Au- Lawyers for car owners are due to thority (EBA), told the German submit the proposed deal to the San newspaper Welt am Sonntag. Francisco federal judge overseeing US While betting odds have con- lawsuits by June 28. The settlement sistently indicated a vote to re- will include options for car owners to main in the EU, opinion pollsters sell their vehicles back to Volkswagen have so far painted contradictory or to terminate their leases early. pictures of how Britons will vote. Terms of that agreement may The EBA is currently working change between now and then, the on an EU single rulebook aimed person said. The judge is scheduled at ensuring a level playing fi eld to consider the proposal, along with for all banks across the 28-coun- the car maker’s agreements with try bloc’s capital market. regulators, on July 26 before deciding Volkswagen vehicles are parked with their exhaust pipes facing the street at a dealership in Medford, Massachusetts. Since the US Environmental Protection Agency “This work needs to be com- whether to accept it. and the California Air Resources Board haven’t approved VW’s proposed fixes, the latest deal includes an option for car owners to request their vehicles be repaired. pleted irrespective of the result Jeannine Ginivan, a Volkswagen of the referendum,” said Enria, spokeswoman in the US, declined to than a week after the news broke, and son, meaning it may take almost two Volkswagen is also subject to law- authorities to step up scrutiny of real- an Italian national.”We must en- comment on the proposed agreement. Volkswagen has so far set aside €16.2bn years before all 482,000 are addressed. suits in Germany and still faces a world emissions and fuel economy. sure that there are no diff erent Spokesman for the Environmental ($18.3bn) to cover the costs of the scan- “There’s just no precedent for what criminal probe there as well as in the In an eff ort to rebound, Volkswagen rules between the countries that Protection Agency and California Air dal, including repairs and lawsuits. happens if there’s not a fi x,” said John US Prosecutors in Germany are look- chief executive offi cer Matthias Muel- have the euro and those that do Resources Board didn’t immediately VW shares have fallen more than 6% German, a project manager with the ing into allegations against a VW em- lerhas mapped out a sweeping strat- not have it.” respond to messages seeking comment in Frankfurt since both sides told US International Council on Clean Trans- ployee who might have encouraged egy overhaul focused on electric cars, Enria said the European bank- on it. District Judge Charles Breyer on April portation, an environmental public- other employees to delete or remove automated driving and services such ing sector was more stable now The proposal is intended to further 21 that they had a preliminary agree- policy group in Washington. “We just data. Prosecutors also said most of the as ride-hailing. The shift will entail than fi ve years ago, but there was the German car maker’s bid to re- ment. don’t know. It’s all speculation.” data has been recovered in the mean- more than €10bn ($11.2bn) in invest- still need for consolidation. gain consumer confi dence while ap- Under the proposed deal, vehicle The company isn’t entirely out of the time. ments by 2025, which will be fi nanced “If you look at the balance peasing regulators after admitting in owners can register to have their car woods if the plan is approved. State or The diesel-cheating scandal has in part by cost-cutting at the namesake sheets of banks, you could ac- September that it rigged the exhaust repaired but will be told that it may federal regulators could still impose as- sent shock waves across the industry VW brand and bundling together its tually ask yourself whether system in 11mn diesel cars worldwide never actually happen, the person said. yet undetermined fi nes depending on and triggered VW’s fi rst annual oper- fragmented parts operations, the com- such low profitability and such to feign compliance with global emis- Volkswagen has capacity to handle the number of cars that remain on the ating loss since 1993. Admissions of pany said on Thursday at a press brief- low return on investment are sions standards. Chief executive offi cer about 5,000 vehicles each week under road and the pollution from them, the manipulation and allegations of cheat- ing at its Autostadt exhibition centre in sustainable in the long term,” Martin Winterkorn stepped down less the settlement, according to the per- person said. ing by other carmakers have pressured Wolfsburg. he said. Texas Instruments rides ‘dull’ products, cash returns to record

Bloomberg new products and production and wild “As an investor, in a 2%-type invest- in third when ranked by how small a the leader in mobile-phone processors as cash generated from operations mi- San Francisco swings in demand have often wiped out ing world, this is attractive to me,” said portion of sales spent on research and and surpassed it in sales. nus the cost of capital expenditure — to profi ts. The secret to investing in them Charlie Smith, chief investment offi cer development. That’s a good thing, ac- While analog chips that go into in- work is winning it fans. Unlike some was to pick a leader at the beginning of at Fort Pitt Capital. cording to Templeton. It’s still gaining dustrial equipment, cars and everyday larger competitors, it doesn’t hoard t 86 years old, Texas Instru- a cycle, ride a growth spurt, then get “We’ve owned the stock for over 20 market share, showing how well placed items connected to the web are “dull,” cash overseas, hoping for a future US ments doesn’t grow very much. out before the inevitable downturn. years, think we understand them pretty his bets are. according to Northern Trust Securities tax break. It repatriates its earnings AIt’s had just three annual sales Texas Instruments once led the elec- well, and would look to add shares at Consider the extremes in the indus- analyst Neil Campling, even moderate to the US, paying a higher tax rate but increases in the past 10 years and ana- tronics industry as the creator of the lower levels.” try. Texas Instruments sells chips such growth by Texas Instruments would be freeing up its cash for buybacks and lysts are predicting a decline again this integrated circuit, digital watches and Templeton said earlier this month as power converters, components that attractive, given the returns it’s already dividends and delivering on its promise year — yet investors have bid its stock even the classic Speak & Spell, but it’s that his company, the biggest maker manage the fl ow of electricity inside, providing. to use almost all of it for that purpose. up to a record. now known by most people as a legacy of analog chips, has deliberately opted say, a phone or computer, that sell for “The fact is, we’re in a world that’s Northern Trust’s Campling said ana- The company’s shares reached maker of calculators. Yet under chief out of the roller-coaster ups and downs $2.50 each. Intel Corp’s Xeon server short of growth,” he said. Texas Instru- lysts have yet to adjust the method they $62.14 last week, the highest level in its executive Offi cer Rich Templeton, the suff ered by companies that make big processors retail for as much as $7,000 ments and a couple of its analog peers use to rank and rate TI and try to com- history, giving it a market value of more company has taught investors that bets on expensive digital chips in com- a pop. Intel has only a handful of cus- are “dull in terms of products but not pare it with other chipmakers that still than $62bn and adding to gains of 13% semiconductor makers can be stable petitive markets. Instead, Texas Instru- tomers who need such a product and dull in terms of returns.” prioritise top-line growth and spending this year. It’s done that without any cash cows. ments has created the broadest product spends more than $19bn on research, More thrilling chip companies spend whatever it takes to achieve that. Only fl ashy product announcements, posi- “When we talk about semiconduc- lineup and biggest customer list in the development, plants and equipment. a good portion of their earnings calls about a third of the analysts who cover tive earnings surprises or high-profi le tors we now talk about growth that has industry and kept spending at a frac- Pretty much every electronics device and investor events talking about tech- Texas Instruments recommend buying customer wins. Instead, it maintains a matured,” said Tore Svanberg, an ana- tion of revenue. That will allow it to on the planet needs at least one power nology, new products and where they it. Linear Technology Corp, another ob- wide, stable product off ering and keeps lyst at Stifel Nicolaus. “TI has under- grow in the future as more chips get converter, and Texas Instruments got see markets heading. Texas Instru- scure chipmaker that Campling says of- spending in check. stood that and done a really good job of used in industrial machinery and cars. by with a total investment in research, ments executives typically try to turn fers even better returns, is only rated buy “It’s TI’s strong free cash fl ow and attracting value investors.” “And if that doesn’t sound like a tech plants and equipment of $1.8bn last the conversation to capital allocation. by 17% of the analysts covering it. stable, bullet-proof business model The company gives all of its free cash company, I’m OK with that,” Templeton year. Intel reported four times TI’s rev- The company is the only one in the in- Some are coming around to looking that continue to attract investors,” said fl ow cash to shareholders in the form said at the Sanford C. Bernstein & Co enue in 2015 but spent 11 times more to dustry to hold an annual conference call at it in diff erent terms, closer to the way Dan Morgan, a fund manager at Syno- of share repurchases and dividends conference earlier this month. “We’ve get there. to update investors on that topic alone. that investors have already settled on. vus Securities which owns Texas In- and has increased that cash produc- got a lot of innovation that takes place While Texas Instruments has inocu- “They doing a good job of making “The cash return story has reso- struments stock. “Portfolio managers tion even as sales have stagnated. That inside the company.” lated itself against the worst of steep sure the investors don’t focus on tech- nated,” said Stacy Rasgon, an analyst at are looking at TI as a safe bet.” means Texas Instruments guarantees While Texas Instruments is 24th out downturns, it’s also missed out on some nology,” said Stifel’s Svanberg. “They Sanford C Bernstein. “Everyone agrees In the past, chip companies have a 5% to 6% return to its investors, ac- of 30 companies on the Philadelphia of the surges that digital products in just want to be left alone to focus on it’s one of the highest-quality compa- been anything but a predictable haven. cording to RBC Capital Markets analyst Stock Exchange Semiconductor Index high-volume markets like smartphones their free cash fl ow.” nies in the sector. It’s a question of what The skyrocketing cost of developing Amit Daryanani. when graded by sales growth, it comes can deliver. Qualcomm replaced it as And how it puts that cash — defi ned price do you put on it?” Monday, June 20, 2016 GULF TIMES BUSINESS

GCC firms urged to take immediate action to prepare for VAT, excise tax

GCC companies should take immediate tasked to provide its recommendation by Taxes partner, said, “The introduction of of the new tax systems and be ready by businesses to get ready. In any case, and processes are in place to apply the action to prepare for VAT and excise tax the end of summer in view of the formal VAT and excise tax constitute an impor- go-live date.” businesses need to start preparing in tax correctly and generate the required and ensure right knowledge, systems and announcement of the treaties. tant policy reform aiming to help GCC gov- Upon the ratification of the treaties, advance to be able to comply with the reporting and documentation. processes are in place, PwC has said in a The Excise Tax and VAT treaties ernments achieve medium to long term each member state will need to issue new tax obligations including charging, The formal announcement of the GCC statement. constitute the common framework for social and economic policy goals, and its own national VAT and excise tax collecting and paying VAT and excise tax common VAT and excise tax treaties is ex- The GCC Ministers of Finance held an the introduction of these taxes in the reduce reliance on hydrocarbon revenues. legislation based on the agreed common to the tax authority in a timely manner. It pected now in the last quarter of this year extraordinary meeting in Jeddah on June GCC, which is expected to occur by 1st Approval of the treaties is an important principles. This will entail the issuance is the right time to start creating aware- and this will pave the way for the adoption 16 and approved in principle the Value of January 2017 and 1st of January 2018, development as it sets out common of national VAT and excise tax laws ness and increase knowledge through- of the new tax systems by GCC member Added Tax (VAT) and Excise Tax treaties. respectively. The treaties will form the principles that will guide the application along with the implementing regula- out the organisation, as well as start states by the expected dates. Some administrative matters still need basis for the issuance of national VAT of VAT and excise tax at a national level by tions in accordance with each Member assessing the potential impacts of the Businesses should start adopting VAT to be resolved, notably with regards to the and Excise Tax legislation by each GCC each individual member state. Companies State’s national legislative process. This new taxes on the business, including im- and excise tax compliant strategies now to tax collection mechanism related to intra- member state. should take action now, if they have not should happen ahead of the expected pact on margins and cash flow. It is also ensure a smooth transition at a later stage, GCC trade. The GCC Committee has been Jeanine Daou, Middle East Indirect already, to prepare for the implementation go live date, allowing sufficient time for essential to ensure the right systems PwC said.

Milaha Capital plans to acquire Al Shaheen Energy Services

ilaha Capital is plan- Shaheen Holding, a company ning to acquire Al existing under the laws of Qatar MShaheen Energy Serv- with commercial registration ices from Al Shaheen Hold- number 33443. ing, a wholly-owned subsidi- The seller (Al Shaheen Hold- ary of Qatar Petroleum, at an ing) is wholly-owned by Qatar estimated cost of $110mn to Petroleum, while the target (Al $180mn. Shaheen Energy Services) is a “A fi nal agreement for the holding company which owns transaction has yet to be agreed 50% of the issued share capital between the parties but the in each of PII Group (directly) purchase price is expected to and PII North America (indi- be approximately $110mn — rectly). The remaining shares in $180mn, subject to certain as- the PII Group are held by vari- sumptions and completion of ous General Electric Company confi rmatory due diligence, subsidiaries. and will be funded by Milaha The PII Group is an industry from existing cash reserves,” a leader in pipeline inspection spokesman of Milaha said in a and integrity services and op- Traders work on the floor at the Abu Dhabi Securities Exchange (file). Abu Dhabi’s main stock index added 4.7% yesterday in its heaviest trading day since November 2014. regulatory fi ling with the Qatar erates globally. The joint ven- Stock Exchange. ture between GE and Qatar Pe- The transaction, which is troleum has been in existence slated to be completed in the since 2010. last quarter of this year, is ex- However, Milaha has not pected to have a “positive” im- identifi ed any material risks pact on the fi nancial position with regards to completion of of Milaha and its shareholders, the transaction after undertak- the regulatory fi ling said. ing preliminary legal, fi nancial Abu Dhabi bank stocks The primary objective of the and technical due diligence ex- proposed transaction is the ac- ercises on the target and the PII quisition by Milaha Capital of Group, the fi ling said. the entire issued share capital Further confi rmatory due of Al Shaheen Energy Services, diligence will be undertaken a company existing under the only once the seller accepts laws of England and Wales with the off er of Milaha Capital, soar on merger talks; company number 03424318 which was created by Milaha and registered address Con- (formerly Qatar Navigation) to nect House 133-137 Alexandra allow specifi c focus on invest- Road, Wimbledon, London, ment activities outside its core rate rise hits Egypt SW19 7JY, England from Al maritime-based businesses. Analysts divided over banks by assets in the Middle ing 11.5% in its highest volume liquefi ed petroleum gas, has agement vehicle of the family, benefits of an NBAD-FGB East and Africa. Many analysts since November 2014. been rising partly on hopes it jumped 5.3%. Goic: Gulf investments merger; but talks spur said it was too early to take posi- Other Abu Dhabi bank shares may benefi t from projects in In Egypt, the central bank speculation of industry tions in the stocks before details also rose, partly on speculation Saudi Arabia’s economic reform raised its key interest rates by consolidation; Dubai sags were known. they might be involved in further plan announced this month. 100 basis points after the close in cement, lime, plaster as attention diverted to Abu Some said a merger could mergers and acquisitions activ- Kuwait’s index rose 1.2%, on Thursday to their highest Dhabi; Kuwait buoyed by benefi t both shareholders. ity as the industry consolidated. buoyed by news an investment levels in years to rein in surging Americana stake sale; Egypt Arqaam Capital said FGB Union National Bank climbed group led by prominent Dubai infl ation and ease downward manufacturing reach rate hike much harsher than would benefi t from a stronger 7.0%. businessman Mohamed Alab- pressure on the Egyptian pound. expected wholesale banking operation Abu Dhabi’s main stock index bar had agreed to buy a majority Analysts had been roughly $18.1bn in 2015 while NBAD was underrepre- added 4.7% in its heaviest trad- stake in Kuwait Food Co (Ameri- evenly split on whether the cen- Reuters sented in retail banking. ing day since November 2014. cana) from the Kharafi family for tral bank would tighten policy. Dubai “We see strong merits of this As attention switched to Abu about $2.4bn. Few analysts who expected a nvestments in the manu- The manufacture of cement, potential transaction for both Dhabi, trading volume in Dubai After the Dubai group com- tightening had predicted such facture of cement, lime, and lime, and plaster includes the parties,” Arqaam said. shrank to very low levels and the pletes the purchase, it will a large increase, so the decision Iplaster in the Gulf Co-op- manufacture of clinkers and hares in Abu Dhabi banks But HSBC predicted a pure index fell 0.3%. launch a mandatory takeover hurt the stocks, especially since eration Council (GCC) reached hydraulic cements, including soared yesterday after Na- merger would benefi t only Dubai’s largest listed lender, off er to remaining Americana many economists think more $18.1bn in 2015, a Gulf Organi- Portland, aluminous cement, Stional Bank of Abu Dhabi NBAD, while a merger through Emirates NBD, edged down shareholders at 2.650 dinars. tightening and currency depre- sation for Industrial Consult- slag cement, and superphos- (NBAD) and First Gulf Bank acquisition would destroy 0.1%. Americana shares were bid at ciation are likely in the second ing (Goic) report said. phate cements, the manufac- (FGB) confi rmed they were in shareholder value at both Saudi Arabia closed fl at in their upper daily limit of 2.2 di- half of this year. Published by the Gulf Indus- ture of quicklime, slaked lime, merger talks. banks.”A share swap scenario modest volume after spending nars yesterday but did not trade The Cairo stock index EGX30 trial Knowledge Centre (GIKC), and hydraulic lime, and the Other Gulf stock markets presents signifi cant dilution most of the day higher. because holders were not willing dropped 1.1%. Ezz Steel , ex- the report said the number of manufacture of plasters of cal- were mixed while an interest risks to shareholders of both Petrochemical shares were to sell at that level. posed to higher interest rates as factories manufacturing ce- cined gypsum or calcined sul- rate increase dragged Egypt banks,” it said. fi rm after oil prices rebounded Nevertheless, the boost to the a borrower for capital-intensive ment, lime, and plaster in the phate. down. Nevertheless, local retail in- on Friday. fi nances of the Kharafi s, a major projects, dropped 2.3%. GCC jumped from 59 in 2011 to The GIKC publishes de- NBAD and FGB confi rmed in vestors cheered the idea of an National Gas and Industriali- merchant family in Kuwait, was Elsewhere in the Gulf, the 69 in 2016, a compound annual tailed industrial reports in GCC a brief statement they were dis- Abu Dhabi mega-bank, with sation rose sharply for a fourth seen as positive for the market as Kuwait index rose 1.2% to 5,458 growth rate (CAGR) of 4%. countries, which tackle various cussing a merger or combina- NBAD shares jumping the 15% straight day in unusually heavy a whole. points, the Oman index was fl at The report also highlighted areas, including food, medi- tion of their businesses, in what daily limit in their heaviest trade trade, gaining 5.0%. National Investment Co, an at 5,808 points and the Bahrain a surge in investments from cal supplies, plastics, textiles, would create one of the largest since April 2015, and FGB gain- The fi rm, which distributes investment and asset man- index fell 0.4% to 1,113 points. $15.4bn to $18.1bn, a CAGR of leather, chemicals and petro- 4.1% for the same period, while chemicals, engineering, the labour force expanded from environment, recycling, and 25,304 to 26,469 workers, a other important sectors. QSE opens week strong on institutional buy support CAGR of 1.1%. GIKC’s website is available Furthermore, data from Go- in Arabic and English to pro- By Santhosh V Perumal whereas micro and small caps fell 0.43% institutions were net buyers to the tune of plummeted 56% to 0.04mn stocks, value ic’s Industrial Information Unit vide a source of comprehensive Business Reporter and 0.32% respectively. QR4.35mn against net sellers of QR1.13mn by 58% to QR2.62mn and deals by 21% revealed that the manufacture industrial information in the The Total Return Index rose 0.14% to on June 16. to 61. of cement, lime, and plaster Gulf. It off ers a “unique set” of 15,864.83 points and All Share Index by Domestic institutions’ net buying The real estate sector saw 55% shrinkage represented approximately Goic’s industrial studies, in- The Qatar Stock Exchange yesterday 0.12% to 2,734.15 points; while Al Rayan increased to QR5.38mn compared to in trade volume to 0.29mn shares, 50% in 2.4% of the total factories, dustrial investment opportu- opened the week strong to break the Islamic Index fell 0.12% to 3,806.88 points. QR3.83mn the previous trading day. value to QR6.2mn and 13% in transactions 47.3% of the total investments, nities, and updated reports on 9,800 mark mainly on institutional Telecom stocks strengthened 0.95%, Non-Qatari individual investors turned to 188. and 9.7% of the total labour several industrial sectors. For buying support. transport (0.44%), insurance (0.35%), net buyers to the extent of QR1.41mn The banks and financial services sector’s force in the fi eld of building more information, visit www. Buying was seen more pronounced in the banks and financial services (0.23%) and against net sellers of QR2.45mn last trade volume tanked 39% to 1.02mn materials manufacture in 2015. knowledge.goic.org.qa. telecom, transport and insurance sectors industrials (0.16%); even as realty and Thursday. equities, value by 37% to QR44.31mn and as the 20-stock Qatar Index gained for consumer goods fell 0.39% and 0.37% However, local retail investors turned deals by 41% to 364. the fourth straight session by 0.14% to respectively. net sellers to the tune of QR16.67mn The market witnessed 21% decline in 9,805.61 points amid decline in trade More than 56% of the stock extended compared with net buyers of QR3.67mn the industrials sector’s trade volume turnover and volumes. gains with major movers being Ooredoo, on June 16. to 0.46mn stocks, 40% in value to The Islamic stocks were seen declining Vodafone Qatar, QNB, Commercial Bank, The GCC individual investors were net QR15.64mn and 10% in transactions to vis-à-vis gains in the conventional ones Mesaieed Petrochemical Holding, Gulf profit takers to the extent of QR3.55mn 419. in the bourse, which is, however, down International Services, Qatar Insurance, against net buyers of QR0.49mn the However, the telecom sector’s trade 5.98% year-to-date. Barwa, United Development Company, previous trading day. volume soared 39% to 0.43mn shares and Large cap equities witnessed some brisk Gulf Warehousing and Nakilat; but Qatar Total trade volume fell 34% to 2.42mn value by 89% to QR13.99mn on more than buying in the market, where banking, Islamic Bank, Ezdan and Mazaya Qatar shares, value by 32% to QR91.58mn and doubled deals to 283. industrials and telecom stocks together were seen bucking the trend. deals by 11% to 1,557. The consumer goods sector reported constituted about 79% of the total trading Non-Qatari institutions turned net buyers There was 68% plunge in the transport 33% surge in trade volume to 0.08mn volume. to the extent of QR9.08mn compared sector’s trade volume to 0.1mn equities, equities, 22% in value to QR4.54mn and Market capitalisation rose 0.25% or more with net sellers of QR4.38mn last 49% in value to QR4.27mn and 33% in 34% in transactions to 139. than QR1bn to QR530.41bn as large and Thursday. transactions to 103. In the debt market, there was no trading midcap equities gained 0.44% and 0.06%; The GCC (Gulf Cooperation Council) The insurance sector’s trade volume of treasury bills and government bonds. The number of factories manufacturing cement, lime, and plaster in the GCC jumped from 59 in 2011 to 69 in 2016, Goic says.