MIDEAST GROWTH | Page 2 ALL-TIME HIGH | Page 3 Xi pledges Temasek net $20bn portfolio value in loans hits $227bn

Wednesday, July 11, 2018 Shawwal 27, 1439 AH CAPITALISATION GAINS OVER QR7BN: Page 16 QSE inches towards GULF TIMES 9,400 levels on across-the-board BUSINESS buying support

Qatar most active player in Mena QDB, ITC to step up joint debt capital market

Qatar was the most active player 18 more than the 40 recorded in in the Middle East and North Af- the energy and power industry, rican (Mena) debt capital market the study said. support for Qatar MSMEs (DCM), accounting for 28.5% of Goldman Sachs currently leads the issue in terms of value, ac- the Q2, 2018 announced any he Qatar Development cording to Thomson Reuters. Mena involvement M&A league Bank (QDB) and the In- The mergers and acquisition table. JP Morgan and Credit Suisse Tternational Trade Centre (M&A) deals with Mena involve- follow in second and third place. (ITC) have announced the sign- ment touched an eight-year high Fees generated from com- ing of a partnership for a $1mn of $33.9bn during the second pleted M&A transactions totalled funding to help diversify micro, quarter (Q2) of this year, it said $59.6mn, a 52% decrease from small and medium-sized enter- in a report. last year and the lowest first half prises (MSMEs) in Qatar. Saudi Arabia trailed behind Doha since 2012. Syndicated loan fees As part of a new co-operation with 21.8% share in the Mena stood at $215.7mn, up 17% from agreement, QDB will provide DCM, it said, adding Internation- Q2 2017. $1mn to ITC towards the de- al Islamic debt issuance (within The Mena equity and equity- velopment and enhancement the region) reached $19.3bn so related issuance totalled $3bn of competitiveness of MSMEs far this year. during Q2, 2018, a 68% increase in the country, the ITC said in a The DCM have seen significant year-on-year. statement yesterday. activity during the first half of Out of the 15 transactions an- The two organisations will this year, despite a 2% decreased nounced so far this year, nine work jointly to diversify the ex- compared to Q2, 2017. Debt issu- have been follow-on off erings, ports of Qatari enterprises and ance in the Mena region is at its raising a total of $1.8bn and improve the visibility of Qatari second highest level, reaching accounted for 58.5% of the first non-oil and non-gas sectors, the $59.4bn so far this year. half ECM (equity capital market) ITC said. Standard Chartered currently activity in the region. A letter of declaration was leads in the Mena bond ranking Orange Egypt follow-on raised signed by QDB CEO Abdulaziz for Q2 2018 with a 14.9% share $866mn and is the biggest deal bin Nasser al-Khalifa and ITC of the market, while CIMB Group so far during 2018. EFG Hermes executive director Arancha Holdings took the top spot for leads the Mena ECM ranking González on the sidelines of Islamic DCM issuance with a with a 24.4% market share, the ITC’s annual Joint Advi- 15.5% share. followed by JP Morgan and Gold- sory Group (JAG) meeting in The value of announced M&A man Sachs in second and third Geneva. transactions with any Mena place, respectively. Announcing the launch of the involvement reported 74% The Mena investment bank- project, al-Khalifa, said: “We Qatari enterprises have the skills to compete in regional and González says the partnership with QDB will allow us to jointly growth year-on-year during Q2, ing fees totalled an estimated know that Qatari enterprises international markets, says Abdulaziz al-Khalifa. address challenges faced by Qatari enterprises. 2018, it said. $472.3mn during Q2 2018, have the skills to compete in Deals with a Mena target 7% less than the value of fees regional and international mar- benefi t from trade and market the United Nations Confer- business e-commerce markets. tween QDB and ITC has been reached an all-time high rising to recorded during Q2 2017. kets. This project supports QDB intelligence, provide the right ence on Trade and Development One focus would be through es- designed along the lines of the $21.3bn, up 110% from the same DCM fees accounted for 30% eff orts to improve the national skills to succeed in e-commerce (UNCTAD). tablishing a barcode standard in Qatar National Vision 2030, period in 2017 while inter-Mena of the overall Mena investment trade-enabling environment as and work towards establishing a The focus will be on sustain- Qatar that will encourage com- which puts diversifi cation of or domestic deals reached a banking fee pool, the second well as enterprise export com- barcode standard in Qatar.” ing the quality and transparency panies to produce goods con- the economy as a priority ob- five-year high, also up 232% highest market share since its petitiveness.” In addition to supporting Qa- of trade-related information, forming to international market jective. year-on-year. records began in 2000. Syndi- González added: “This part- tari businesses to diversify out strengthening public-private standards. This will ease access In addition to providing sup- Energy and power deals ac- cated lending fees accounted nership with QDB will allow us of the hydrocarbon sector, the dialogue and transforming this to new national, regional and in- port to Qatar in realising its de- counted for 32.8% of Mena for 46% while the share of com- to jointly address challenges funding will also provide sup- data into intelligence. ternational markets and improve velopment objectives, the part- involvement M&A by value, pleted M&A advisory fees fell to faced by Qatari enterprises and port for the Global Trade Help- Stepping up its support for product safety by ensuring bet- ners are committed to explore followed by the financial sector its lowest level, only accounting help them diversify and scale desk (helpmetrade.org), an initi- Qatari MSMEs, the project will ter traceability along the global further opportunities for future with a 30.2% market share but for 13% of the market. ECM up exports. This includes em- ative launched by ITC, the World work to better integrate them supply chain. collaboration, in Qatar and else- counting with 58 transactions, underwriting fees was 12%. powering MSMEs to access and Trade Organisation (WTO), and into the global business-to- The renewed partnership be- where in the region, the ITC said. Qatar firms to get ‘big savings’ once ATA Carnet takes effect next month Iran vows to sell as

By Peter Alagos Business Reporter much oil as it can

Companies in Qatar could expect to generate “very big savings” in opera- tional costs once the ATA Carnet takes eff ect in the country next month, Qatar Chamber Legal Aff airs Department director Abdul Aziz al-Kuwari said. despite US sanctions Aside from cost, the ATA Carnet will help companies in Qatar save time in terms of streamlining procedures when exporting and re-exporting Reuters have no impact, but added: “We a number of fi rms have already goods, al-Kuwari told Gulf Times on the sidelines of Qatar Chamber’s first London will make Americans under- said they plan to pull out. workshop on the ATA Carnet yesterday. stand this year that they cannot Foreign ministers from the “A lot of countries require customs duties, certificates, and other costs. But ranian vice-president Es- stop Iranian oil sales.” fi ve remaining signatory coun- with the ATA Carnet, companies will only pay for fees of the carnet and the haq Jahangiri acknowledged The US ambassador to Ber- tries to the nuclear deal — Brit- guarantee, which will be returned once the companies return to Qatar, so Iyesterday that US sanctions lin called on the government ain, France, Germany, China they get very big savings on money and time,” al-Kuwari pointed out. would hurt the economy but of Chancellor Angela Merkel and Russia — off ered a package The ATA Carnet is an international customs document that allows the promised to “sell as much oil as to block an Iranian attempt to of economic measures to Iran on duty-free and tax-free temporary import and export of goods for up to we can” and protect its banking withdraw large sums of cash Friday but Tehran said they did one year. The system is applied to import-export goods that will return system. from bank accounts in Germany. not go far enough. to the country of origin within the period which is approved by customs Jahangiri said Washington was Iran’s foreign ministry and “We think the Europeans will authorities. trying to stop Iran’s petrochemi- the central bank have taken act in a way to meet the Iranian Al-Kuwari also stressed that the ATA Carnet will help make Qatar attractive Qatar Chamber Legal Aff airs Department director Abdul Aziz cal, steel and copper exports, measures to facilitate bank- demands, but we should wait to foreign investors, and “will contribute to activating the tourism sector, al-Kuwari speaking at the first workshop on the ATA Carnet held in and to disrupt its ports and ship- ing operations despite the US and see,” Jahangiri said. conferences, and exhibition being held in the country.” Doha yesterday. ping services. “America seeks to sanctions, Jahangiri said with- The pressure on Iran came as “Countries travelling abroad for exhibitions and events always look for the reduce Iran’s oil sales, our vital out elaborating. The Iranian oil Washington had launched an ATA Carnet for the export and re-export of the goods that they are using. companies that are applying for the ATA Carnet. The most prominent source of income, to zero,” he said, ministry said last week that it “economic war with China and There are 77 countries, including Qatar, that use the ATA Carnet. features of the ATA Carnet is that it enables marketing representatives, according to Fars news agency. exported 2.2mn barrels per day even its allies”, he said, referring “This makes coming to Qatar very easy for many companies abroad, thus exhibition participants, and businessmen to make advance customs President Donald Trump said of crude oil in June. to trade tensions between the the ATA Carnet plays an important role in helping transform the country arrangements at a predetermined cost, visit several countries con- in May he would pull the United The fi gure is not signifi cantly United States and many of its into a prime investment destination. It is also a huge step, especially in the secutively, and use the ATA Carnet for several trips during its one-year States out of an international lower than exports of 2.4mn bpd main trading partners. run-up to the 2022 FIFA World Cup games, and in meeting the objectives validity. nuclear deal with Iran and reim- in April and in May. Jahangiri also accused Wash- of the Qatar National Vision 2030,” he said. The system facilitates and simplifies customs procedures across borders pose US sanctions. European powers still support ington of trying to use the eco- The workshop, held in co-operation with the International Chamber of for exporters and importers using one document to complete all customs Washington later told coun- the 2015 deal, under which Te- nomic pressure to provoke street Commerce (ICC) Qatar and the General Authority of Customs, is the first procedures in the 77 countries that apply the ATA Carnet system. tries they must stop buying hran agreed to limit its nuclear protests in Iran. A wave of anti- of a series of weekly workshops to be held at the chamber every Tuesday It includes all types of goods and equipment, including commercial Iranian oil from November 4 or development in exchange for in- government demonstrations this month. samples, professional equipment, and goods for fairs, exhibitions, and en- face fi nancial consequences. ternational sanctions relief. against economic hardship and But al-Kuwari said other workshops could be held after the August tertainment events on condition that they will be returned to the country Jahangiri said it would be a They say they will do more to alleged corruption engulfed cit- 1 implementation of the system “if needed” and depending on the of origin within the period which is approved by customs authorities. mistake to think the US “eco- encourage their businesses to re- ies across the country in late De- nomic war” against Iran will main engaged with Iran, though cember and early January. Gulf Times 2 Wednesday, July 11, 2018 BUSINESS

Australia’s Macquarie China’s Xi pledges $20bn hikes home loan rate in loans to revive Mideast Reuters Sydney

Reuters Beijing ustralia’s biggest invest- ment bank Macquarie AGroup hiked home loan hinese President Xi Jinping rates even as the country’s offi - yesterday pledged a package cial rate remains steady, in a sign Cof $20bn in loans, and about funding costs were rising and $106mn in fi nancial aid, to Middle East larger rivals such as the “big four” nations, as part of what he called an “oil retail banks could follow suit. and gas plus” model to revive economic Rate hikes by top lenders growth in the region. would pressure the housing Beijing has ramped up engagement market that is already in retreat in the Middle East in recent years as following a series of tighter reg- Arab nations play an important role ulations, and anger consumers in Xi’s signature Belt and Road for- and others amid a public inquiry eign policy plan for strong trade routes into fi nance sector misconduct linking China with central and south- in Australia. east Asia. Macquarie said yesterday on its Development was key to resolving website that it was raising mort- many security problems in the Middle gage rates by 6-10 basis points, East, Xi told a gathering with repre- but did not provide an explana- sentatives of 21 Arab nations in the Chi- tion for the move, which comes nese capital. a week after the Reserve bank of “We should treat each other frankly, Australia kept rates on hold at its not fear diff erences, not avoid prob- monthly meeting. lems, and have ample discussion on Rates have been at a record low each aspect of foreign policy and devel- since August 2016. opment strategy,” he said. “We’re going to see the higher China would off er aid worth 100mn funding costs get eventually yuan ($15mn) to Palestine to support passed through by the major re- economic development, besides pro- tail banks, which will further viding a further 600mn yuan ($91mn) squeeze households in terms of to Jordan, Lebanon, Syria and Yemen, their outlook for consumption,” he added. said Kerry Craig, Global Market A consortium of banks from China Strategist, JP Morgan Asset Man- and Arab nations, with a dedicated fund agement. “Do we see out-of- of $3bn, will also be set up, he said. cycle rate hikes coming through It was unclear what the relationship from other banks in Australia? between the bank consortium, fi nancial Yes, probably.” aid and the overall loan package would Smaller players had already be. been raising their home loan rates The loans will fund a plan of “eco- in recent weeks to protect their nomic reconstruction” and “industrial Kuwait’s Amir Sheikh Sabah al-Ahmad al-Jaber al-Sabah (left) and Chinese President Xi Jinping (right) applaud as they witness a signing ceremony at the Great Hall of margins. revival” that would include co-oper- the People in Beijing. Beijing has ramped up engagement in the Middle East in recent years as Arab nations play an important role in Xi’s signature Belt and Road foreign Australia-listed Homeloans ation on oil and gas, nuclear and clean policy plan for strong trade routes linking China with central and southeast Asia. Ltd increased rates by up to 14 energy, Xi said. basis points for investment hous- He urged “relevant sides” to re- ruption. China, which tradition- involved in resolving long-standing with development, can help resolve region of Xinjiang. But rights groups ing loans “as a result of increased spect the international consensus ally played little role in the Middle disputes. China says it sticks to a political, religious and cultural ten- have criticised the approach, saying funding costs”, according to a in the Israel-Palestine dispute, and East conflicts or diplomacy, despite policy of “non-interference” when sion. It applies this pattern of eco- the clampdown has further stoked, spokeswoman. called for it to be handled in a just its reliance on the region for energy offering financial aid and deals to de- nomic support, as well as a strict se- not eased, tension between different Dutch lender ING Groep NV manner, so as to avoid regional dis- supplies, has been trying to get more veloping countries, which, coupled curity regime, to its restive western religious groups. increased its variable residential home loan rate by 10 basis points in recent weeks to “adjust to market changes”, a spokeswoman said via e-mail. Banking analysts at Citigroup SoftBank tightens grip on Yahoo Japan via $2bn deal with Altaba estimate higher funding costs will push Australia’s four largest lenders, which dominate about Reuters ance sheet.It also leaves SoftBank’s do- concerns of investors who have seen its telecoms fi rms, and Yahoo Japan, an dominate their respective fi elds. 80% of the A$1.6tn ($1.19tn) Tokyo mestic telecoms unit with a 12% stake shares tumble this year. Internet heavyweight in areas such as SoftBank is preparing to list its do- mortgage market, to raise rates in Yahoo Japan, highlighting for inves- Yahoo Japan’s shares ended 11.4% news and shopping. mestic telecoms unit in what could be by September. Westpac and Aus- tors the two companies’ ties ahead of its higher in Tokyo yesterday. SoftBank The synergies between SoftBank and the largest Japanese IPO in nearly two tralia and New Zealand Banking oftBank Group is increasing its planned listing. announced yesterday it will buy ¥221bn Yahoo Japan are “consistent with Soft- decades. Yahoo Japan could use Soft- Group, Australia’s No 2 and No 4 stake in Yahoo Japan through a In the case of Altaba, formerly called ($2bn) of Yahoo Japan shares from Al- Bank Group’s broader strategic synergy Bank’s telecom services to boost de- lenders by market value, declined S$2bn, three-way deal with US Yahoo Inc which also owns about 15% taba. Yahoo Japan will then buy back group initiative,” SoftBank chief execu- mand for online shopping and mobile to comment on their rates, citing fi rm Altaba to deepen ties with the In- of Chinese e-commerce giant Alibaba ¥220bn of stock from SoftBank. tive Masayoshi Son said in the state- payments among Japan’s increasingly legal reasons. ternet heavyweight ahead of an IPO of Group, the deal helps monetize some of As a result of the transaction, Soft- ment. SoftBank and its Vision Fund, net-savvy shoppers. Spokespeople from top lender its telecoms unit. its investment in the joint venture it set Bank’s stake in Yahoo Japan will rise to the world’s largest private equity fund SoftBank, through Yahoo Japan and Commonwealth Bank of Austral- The transaction, with just $9mn net up with SoftBank in 1996. 48.17% from 42.95%. standing at over $93bn as of May last others, is off ering its mobile users an ia, and the third-biggest lender, investment by SoftBank, allows it to And for Yahoo Japan, the deal could SoftBank said in a statement the deal year, have been taking minority stakes increasingly wide range of top-up serv- National Australia Bank Ltd, did boost ownership of Yahoo Japan with- strengthen ties with its biggest share- will strengthen cooperation between in technology companies around the ices in addition to a basic phone sub- not respond to e-mails seeking out pressuring its already strained bal- holder SoftBank and help to assuage the company, one of Japan’s big three world that Son believes will come to scription. comment. Tesla to open plant in Shanghai with annual capacity of 500,000 cars

Reuters Shanghai

esla Inc yesterday signed agreements with Shanghai Tauthorities that will allow it to open a plant in the Chinese city with an annual capacity of 500,000 cars, local media reported. Under the agreements, Tesla will independently open a plant inte- grating research and development, manufacturing and sales functions, according to news website Knews, which is affi liated to state-owned Shanghai Media Group. Tesla and Shanghai authorities did not immediately respond to re- quests for comment. The signing was held at Shang- hai’s Fairmont Peace Hotel but media attendance was limited, a Shanghai government offi cial who declined to give his name told Reu- ters. Tesla’s chief executive Elon Musk Elon Musk, co-founder and chief executive off icer of Tesla Motors attends a key delivery ceremony of the company’s attended the signing, according to a premium electric sedan Model S vehicles to customers in Tokyo (file). Musk had previously criticised China’s tough Reuters witness. Bloomberg report- auto rules for foreign businesses, which would have required it to cede a 50% share in the factory. ed on Monday that Musk will visit Beijing today and tomorrow. tre’s history, Knews said. Chinese cluding cars, become subjected to announced that it planned to scrap Tesla has been in protracted ne- fi nancial magazine Caijing, citing retaliatory tariff s of 25%. rules on capping foreign ownership gotiations to open its own factory in sources close to the project, said the Tesla boss Elon Musk had previ- of new-energy vehicle (NEV) ven- China to help bolster its position in plant’s exact location had not been ously criticised China’s tough auto tures by 2022. the country’s fast-growing market decided and construction would rules for foreign businesses, which The agreements signed on Tues- for electric cars and to avoid high start early next year. would have required it to cede a 50% day also include a memorandum import tariff s. Tesla hiked prices in China over share in the factory. The company of understanding between Tesla The plant will be based in the the weekend to a level more than was keen to maintain control of its and the Shanghai municipal gov- Lingang area, close to Shanghai’s 70% higher than in the United States own plant and protect its technol- ernment, under which Shanghai Yangshan port, and will count as amid mounting trade frictions be- ogy. agreed to support Tesla to set up a the largest foreign manufacturing tween Washington and Beijing that But it registered a new electric car research and development innova- project in the Chinese fi nancial cen- have seen several US imports, in- fi rm in Shanghai in May after China tion centre. Gulf Times Wednesday, July 11, 2018 3 BUSINESS

Malaysian 1MBD fund Temasek net portfolio value investigators to travel to Washington, hits all-time high of $227bn say sources Reuters Reuters Kuala Lumpur Singapore

Malaysian off icials investigating ingapore state investor Temasek a multibillion-dollar corruption Holdings cautioned it was looking scheme linked to a Malaysian Sto temper its pace of investments state fund and former prime this year as trade tensions between minister Najib Razak plan world’s top two economies ratchet up, to meet with US off icials in after reporting a record high annual Washington, US and Malaysian portfolio value. sources familiar with the plans The cautious outlook underlines the told Reuters. challenges that state investment fi rms The visit, including discus- like Temasek face as rising protection- sions with US Justice Depart- ist policies and anti-globalisation sen- ment off icials, could take place timents put their investment and risk before the end of July, the management capabilities to test. sources said. The plans have not China Investment Corp, earlier this been finalised. week, struck a similar cautious note. Malaysian off icials could “We expect global growth to mod- include representatives of the erate and see the probability of risks Malaysian Anti-Corruption Com- increasing,” Temasek’s managing mission, which is leading local director of investment, Sulian Tay, inquiries, two sources familiar said at a news conference yesterday. with the planning said. “These include geopolitical and trade Najib and the fund have tensions as well as monetary and fi- denied any wrongdoing. nancial stresses in important econo- Off icials from the Malaysian mies.” attorney general’s off ice could Escalating trade tensions between be part of the Malaysian team, the United States and China have shak- one of the sources said. en markets over the past month. A spokeswoman for the Washington implemented tariff s of Federal Bureau of Investiga- 25% on $34bn of Chinese imports just tion, which is participating in last week, with Beijing swiftly retaliat- US inquiries related to 1MDB, ing in kind. declined to comment. Recent data suggests “trade wars and The planned visit by Ma- overheated valuations are turning most laysian off icials to the United sovereign wealth funds cautious”, said States reflects the growing Javier Capape, Sovereign Wealth Lab multi-country co-operation that director at IE Business School. has intensified since Malaysian Temasek, the top investor in about voters ejected Najib from the a third of companies in Singapore’s Prime Minister’s off ice in May. Straits Times index, said it was look- 1Malaysia Development ing to temper its investment pace in the An executive prepares to take the stage during the annual Temasek Review in Singapore. “We expect global growth to moderate and see the probability of risks increasing,” Berhad (1MDB), founded by year ahead but was open to investment Temasek’s managing director of investment, Sulian Tay, said at a news conference yesterday. Najib, is at the centre of money- opportunities, including counter-cy- laundering investigations in at clical ones. reshaped itself as a global investor, ($227bn), an all-time high and 12% among main investors in a record-set- chase of a portfolio of student accom- least six countries, including “We do have a more cautious outlook ploughing billions of dollars into tech more than a year ago. ting $14bn fundraising by China’s Ant modation properties in North America the United States, Switzerland right now compared to what we had in startups and emerging markets, while It saw S$29bn in new investments Financial Services Group. worth $1.6bn. and Singapore. Switzerland the past,” said Rohit Sipahimalani, Te- retaining stakes in fi rms such as DBS last year, versus S$16bn in divestments. The United States accounted for the It also led a $502mn investment in is investigating six people on masek’s joint head of portfolio strategy Group and Chinese banks including In recent years, Temasek has raised its biggest share of its new investments in Magic Leap Inc, a US startup developing suspicion of money laundering, and risk group. China Construction Bank. exposure to start-ups. the year just ended, with China coming augmented reality tech products. bribing foreign off icials and Headed by Ho Ching, wife of Sin- For the year ended March 2018, Te- Last month, Temasek and GIC, Sin- in second. Temasek said it was comfortable with other off ences as part of an in- gapore’s prime minister, Temasek has masek’s portfolio value hit S$308bn gapore’s bigger state fund, featured Among its latest US deals is a pur- its Chinese bank holdings. vestigation into Malaysian state fund 1MDB, the Swiss attorney general’s off ice said yesterday. Swiss authorities suspect funds raised for economic development projects by Grab to launch grocery 1MDB and a former unit, SRC TCS posts record profi t on International, were stolen, the statement said. delivery service: CEO “All or part of the financing obtained is alleged to have been used for other purposes, Reuters and higher engagement across strong growth in BFSI unit most particularly for the per- Singapore the user base,” Anthony Tan, sonal enrichment of the per- Grab’s 36-year-old co-founder sons involved,” the statement and group CEO, told Reuters in Reuters from Attorney General Michael rab plans to launch a an interview on Monday. Mumbai Lauber’s off ice said. grocery delivery serv- “When that happens, it at- The six people under investi- Gice, and is betting on tracts more partners and it’s a gation by Swiss authorities are its network of 7.1mn drivers, virtuous upwards cycle. ndia’s top software services exporter, two former off icials from 1MDB, agents and merchants to steer Great for business,” said Tan, Tata Consultancy Services Ltd, posted two former off icials from Abu its expansion beyond its core who scored a big win when Uber Ia record quarterly net profi t in the June Dhabi sovereign funds and two ride-hailing business across handed over its regional opera- quarter, driven by robust growth in its off icials of Saudi energy group Southeast Asia, its chief execu- tions to Grab this year in return Banking, Financial Services and Insurance PetroSaudi International, the tive told Reuters. for a stake. (BFSI) division. statement said. The strategy to provide “eve- A grocery delivery service TCS, whose fi rst-quarter profi t beat The Swiss statement did not ryday” off erings underscores could pit Singapore-headquar- analysts’ expectations, had said in April it identify the individuals or the Grab’s ambition to secure its tered Grab against fi rms such expected a rebound in spending by its key Abu Dhabi funds. Malaysia’s dominant market share at a time as Amazon.com and RedMart, BFSI clients in North America, its biggest finance ministry, responsible for when main rival Go-Jek is em- owned by Alibaba-backed La- market, in the fi nancial year to 2019. 1MDB, declined to comment. barking on a $500mn expansion zada, that off er online grocery Revenue from its BFSI business, the PetroSaudi, which ran an into markets including Thailand shopping in the city-state. company’s biggest revenue stream, energy joint venture with 1MDB and Singapore. Tan, however, said Grab was rose to Rs134.64bn ($1.96bn) from from 2009 to 2012, has previ- Go-Jek, the main ride-hail- also open to partnering with ex- Rs117.89bn, the company said in a state- ously denied any wrongdoing ing player in Indonesia that is isting players. ment yesterday. linked to its joint venture and has backed by the likes of KKR and Grocery deliveries is part of “Our banking vertical recovered very said none of its off icials had been Warburg Pincus, has expanded Grab’s plan to off er a variety of nicely this quarter, while other industry involved in misappropriating any into digital payments, food de- services through a new open verticals maintained their momentum,” funds. The Swiss AG’s off ice said livery and on-demand cleaning platform that will let partners chief executive Rajesh Gopinathan said, two banks – BSI SA Bank and Fal- and massage services. access parts of its technology adding the revenue growth this quarter con Private Bank – are suspected Grab, which is transforming such as logistics and payments. was the fastest in the last 15 quarters. Tata Consultancy Services chief executive off icer Rajesh Gopinathan attends a of involvement in the 1MDB scan- itself into a consumer technol- “Whether it’s food, whether TCS, India’s only technology company news conference announcing the company’s quarterly results in Mumbai. The company’s dal and investigations into them ogy group, already off ers loans, it’s groceries, we need to make with a market capitalisation of more than revenue from Banking, Financial Services and Insurance business, its biggest revenue have been open since 2016. electronic money transfers, sure that all these are well fund- $100bn, is the fi rst software services ex- stream, rose to Rs134.64bn ($1.96bn) from Rs117.89bn, TCS said in a statement yesterday. In 2016, Swiss financial payments and food delivery ed, both technologically and porter to report for the quarter and will set watchdog FINMA confiscated services. fi nancially,” Tan said at Grab’s the tone for India’s $154bn IT sector. Rs59.45bn a year earlier, versus an ana- cloud, analytics and big data grew about funds it said were illicit profits “We believe that as we off er spacious new downtown offi ce The Mumbai-headquartered company lysts’ estimate of Rs69.83bn, according to 44.8% from a year earlier, while income from 1MDB-related deals from more localised everyday serv- in Singapore, where boxes of posted a net profi t of Rs73.40bn in the Thomson Reuters data. from operations jumped about 16% to the two banks and others. ices, there will be more users Apple Macbooks were piled up. quarter ended June 30, compared with Revenue from digital services such as Rs342.61bn. Bankruptcy law is the push Indian companies needed to pay up

Bloomberg ($12bn) with creditors, Sahoo said in an inter- The objective was to bring debt-laden com- Trade Law to harmonise co-operation between New Delhi view at his New Delhi off ice last week. panies back on their feet and help banks free up countries. This will support growth by improving capac- $210bn of stressed assets for lending. Work on that front has already begun, Sahoo ity utilisation and rescuing failed businesses, A report by the Reserve Bank of India esti- said, adding the government would need to India’s new bankruptcy law has instilled fear he said. The insolvency code replaced a web of mates that gross bad-loan ratio may increase to amend the law to incorporate the proposed among delinquent borrowers and prompted archaic laws, some dating back a 100 years, and 12.2% by March 2019 from 11.6% in the previous changes. Even as the government tries to widen several reluctant founders to repay outstanding helped India jump 30 points to make it to the year, limiting bank’s ability to lend to business- the scope of bankruptcy law, bitter court battles debt due to the risk of losing their company, top 100 countries in World Bank’s ease of doing es. The government is also working to put in have bogged down eff orts to clean up bad according to its insolvency regulator. business rankings. place, as early as next month, new rules to hold loans through the new code and companies “There is a perceptible diff erence in the be- The new law is key for Prime Minister accountable individuals, who stood guarantee are missing the 270-day deadline for resolution. haviour of borrowers and lenders,” MS Sahoo, Narendra Modi to wipe out bad loans and boost for loans to a company, in case of a default. The government is running against time to fix chairman of the Insolvency and Bankruptcy growth in Asia’s third-largest economy. The scope of the regulation would later be the legal and operational issues that keep crop- Board of India, said, referring to the period since The law empowers lenders to drag compa- expanded to include individual businessmen ping up and has tweaked the norms several the introduction of Insolvency and Bankruptcy nies that have defaulted for 90 days on debt and eventually every private citizen. India is times. Code in 2016. “The stakeholders know that the exceeding Rs100,000 to the bankruptcy court also planning regulations on cross-border Rival bidders and former owners have ap- firm goes into liquidation if they fail to arrive at which then places it under an administrator to insolvency to pursue foreign assets of a pealed against two of the biggest insolvency a resolution plan within the specified time.” examine a revival or an outright sale. defaulting company. It is working on the model cases to be resolved – Tata Steel’s $5.1bn win- Companies facing bankruptcy petitions have If a plan is not worked out within three quar- cross-border insolvency law adopted by the ning bid for Bhushan Steel Ltd, and Vedanta’s reportedly cleared dues of as much as Rs830bn ters, then the company’s assets get liquidated. United Nations Commission on International $770mn buyout plan for Electrosteel Steels Ltd. Gulf Times 4 Wednesday, July 11, 2018 BUSINESS

Japan picks Endo as top China’s producer infl ation fi nancial regulator

Reuters hits 6-month high in June Tokyo

Reuters apan’s government yesterday Beijing appointed career bureaucrat JToshihide Endo as its top fi - nancial regulator, a move widely hina’s producer infl ation ac- seen as a sign that reforms to celerated to a six-month high in make the banking sector more CJune, lifted by strong commod- profi table will continue. ity prices and threatening to put more Endo, 59, currently director- pressure on the country’s exporters as a general of the watchdog’s su- trade war escalates between Washing- pervisory bureau, will succeed ton and Beijing. Financial Services Agency (FSA) Annual consumer infl ation also Commissioner Nobuchika Mori, edged up as food prices rose at a faster who in his three-year stint has pace, offi cial data showed yesterday. pushed through reforms to boost But retail price pressures remain investor faith in Japan’s stock modest, allowing the central bank to re- market and stimulate the fl ow of main more focused on ways to support funds through its economy. the slowing economy. Endo will formally take up the The United States and China slapped post on July 17, according to an tariff s on $34bn worth of each others’ announcement made yesterday goods last week, fuelling fears of a pro- by Finance Minister Taro Aso, longed battle that would hurt global in- who is also minister in charge of vestment and growth, damage US farm fi nancial services. exports and potentially drive up food Under Mori’s leadership, the prices in China. FSA has introduced corporate The producer price index (PPI) – a governance reforms designed to gauge of industrial profi tability – rose make the Japanese market more by a stronger-than-expected 4.7% in attractive to investors, from June from a year earlier, compared with boosting the number of external a 4.1% increase in May, according to the directors on boards to encour- National Bureau of Statistics (NBS). aging more vocal engagement China’s producer infl ation has now by. picked up for three months in a row af- Endo has worked closely ter easing in late 2017, though month- with Mori on reforms and is on-month growth dipped to 0.3% in widely expected to continue June. Mori’s agenda, FSA sources told Analysts polled by Reuters had ex- Reuters. pected June producer infl ation would “As regional banks face severe pick up to 4.5%, buoyed by a recent re- business environment amid the covery in global commodity prices. dwindling population, Mori has June’s price gains were driven by in- contributed greatly to the pur- creases in oil and gas production, coal suit of the way banks should mining, metals and chemicals process- A customer uses a Xiaomi smartphone at a store in Beijing. China’s producer inflation has now picked up for three months in a row after easing in late 2017, though be,” Aso told reporters after a ing and manufacturing sectors. month-on-month growth dipped to 0.3% in June. cabinet meeting. With oil prices up, China on Monday “I put the right person in the raised retail gasoline prices by the most as oil and steel has benefi ted producers The core consumer price index, US-made models that are imported by of 3% for 2018, the same as last year. right place,” Aso added. “Endo since December 2016. but raised input costs for manufactur- which strips out volatile food and en- China. Some analysts think a shift in mon- is probably more gentle-man- The higher prices have helped fuel a ers like exporters which are further ergy prices, was unchanged at 1.9% in Tesla has raised prices on its Model etary policy towards loosening is al- nered than Mori.” jump in earnings, with profi ts at China’s along supply chains. June. The food price index rose 0.3% X and S models sold in China by more ready underway. Since 2015, Endo has overseen industrial fi rms growing at a sizzling Business surveys show Chinese man- from a year earlier, after ticking up 0.1% than $20,000, automotive news website The central bank pumped more cash the country’s fi nancial fi rms at pace in May, but some analysts say the ufacturers are already reporting softer in May. Electrek reported on Monday. into the economy by cutting reserve re- the FSA’s supervisory bureau, latest gains would have less of an im- export orders as the trade row deepens. Non-food prices rose 2.2%, com- But analysts believe retail price rises quirements for banks this month, and and previously ran its inspec- pact on profi ts. There are few signs in offi cial data pared with 2.2% growth a month will likely be limited, capped by higher regulators have told lenders to lower tion bureau. “Unlike the broad based pick-up in that tariff jitters are percolating through earlier. borrowing costs and waning domestic borrowing costs for smaller companies. Mori has held the fi nancial PPI last year, the recent rebound has to most Chinese consumers just yet. Still, investors are closely watch- demand. “We still think that a broader easing industry partly responsible for been more narrowly driven by oil prices The consumer price index (CPI) rose ing for signs of any upward price pres- “We believe the government is likely of price pressures on the back of slower the vast amount of household and so is less supportive of corporate 1.9% in June from a year earlier, in line sure from American retail goods hit by to introduce special measures such as domestic activity will help keep infl a- savings sitting idle in bank de- profi ts,” Julian Evans-Pritchard, Senior with expectations for a slight pick-up higher Chinese duties, ranging from pet returning the charged 25% tariff s on tion subdued, giving the People’s Bank posits, and criticised invest- China Economist at Capital Economics, from May’s gain of 1.8%. food to mixed nuts and whiskey. some agricultural products to import- ample room to further loosen monetary ment professionals for not wrote in a note. On a month-on-month basis, the German automaker BMW said on ers,” economists at Nomura said in a policy in the coming months,” wrote working in the best interests of The jump in prices of resources such CPI fell 0.1%. Friday that it will have to raise prices on note. China has set an infl ation goal Evans-Pritchard. their clients.

Fuji Xerox chief sees Pakistan rupee may lose 5% till year-end: Analysts no breakup Internews “We expect a further depreciation of is amenable to providing a large bail- rupee is contingent on when Pakistan should the new government decide to Karachi around 5% in PKR/USD by the second out “which we think may be somewhat receives bailout assistance, from where make an approach to the Fund,” the bro- of Fujifilm, half of 2018,” Alfalah Securities said in unlikely its likely terms may be more it receives it, and the amount,” it added. kerage added. a report. The brokerage forecast it at 125 stringent than the IMF’s (International “Despite resort to commercial bor- The brokerage expects continued in- Xerox JV akistan rupee is likely to further till December-end and 128 by June-end Monetary Fund) in some non-economic rowing, the unfunded portion of the terest rate hikes of additional 100 to 125 weaken against the US dollar till of the current fi scal year as compared to areas (control of Gwadar port for exam- overall external gap has resulted in con- basis points to be complemented with Pthis year-end as foreign exchange the yesterday’s close of 121.54 in the in- ple), forcing Pakistan to negotiate with tinued depletion of forex reserves, with greater liquidity management in the Reuters reserves are dwindling with uncertainty terbank market. the IMF at a later stage”. the country’s international liquidity inter-bank market at some stage. Tokyo over fund infl ows to support external Pakistan’s current account defi cit Authorities are eyeing short-term having declined a cumulative $6.4bn in “By end-June 2019, we project sector prevailing far and wide, analysts widened 43% to $16bn or 5.5% of GDP commercial borrowing after recently the past 12 months, or by 39%.” SBP’s policy rate to have increased to said yesterday. for the July-May period of 2017/18. receiving $1bn deposit from China. The Part of the pressure on the rupee is 8% to 10%,” it said. The central bank The head of Fuji Xerox Co Ltd, The analysts said rupee will continue Analysts expect it to be at almost 6% Chinese aid, couple with a favourable also coming from the strength of the US increased its policy rate by a cumula- the joint venture between to experience volatility as well as pres- of GDP for the whole fi scal year ended response to the tax amnesty scheme, dollar globally versus emerging market tive 75 basis points since January. Al- Fujifilm Holdings Corp and sure in the next two to three months. June 30, 2018. The wide defi cit jacked will be enough to safely tide over the currencies. falah Securities expects recent rupee Xerox Corp, yesterday said an The currency has so far been weakened up gross external fi nancing requirement next 2 to 3 months, Alfalah Securities “Moving to a free-fl oat of the ex- weakness and the round of hikes in escalating dispute between the by a cumulative 15% against dollar since to around $25bn for the last fi scal year. said. change rate is very likely to be a prior domestic energy prices will feed into partners will not lead to the ven- December last year. Alfalah Securities said even if China “Looking ahead, the outlook for the action for the next IMF programme, inflation. ture’s dissolution. “I’m confident a breakup will not happen because that wouldn’t make sense (for Xerox) in terms of the energy, money and time it would take to do so,” India’s rice exports set to ease as govt raises buying price Fuji Xerox president Kouichi Tamai told Reuters in an inter- view. Photocopier maker Fuji Reuters on a free on board (FOB) basis, nearly the same Xerox, 75% owned by Japan’s Mumbai as prices quoted by Thai exporters. Fujifilm and the rest by US But the hike in guaranteed price will force copier firm Xerox, is central to a Indian exporters to off er the new season crop months-long battle between the ndia’s rice exports are set to ease from Oc- at around $430 from October, making exports partners over a $6.1bn merger tober as the world’s biggest shipper of the uncompetitive, a dealer said. combining Xerox with the Igrain boosts guaranteed prices that farmers He declined to be identifi ed as he was not au- 56-year-old venture. receive for much of their crop, making new sea- thorised to speak with media. Xerox in May pulled out of son cargoes expensive compared to supply from India’s rice exports in the 2017/18 fi scal year the proposed merger prompt- rival growers. that ended on March 31 surged 18% from the ing Fujifilm to file a lawsuit in Lower exports would mean that India loses year before to a record 12.7mn tonnes on strong June. Xerox subsequently said market share in key Asian and African markets, demand from Bangladesh and Sri Lanka. it may not renew its technology traders and industry sources said, with exports But that demand has already been hit hard, agreement with Fuji Xerox. from countries such as Thailand, Vietnam and said Nitin Gupta, business head of rice at Olam The US firm, which relies on Myanmar likely to fi ll any gaps. India, with Bangladesh imposing a 28% tax on Fuji Xerox for most of its off ice India on Wednesday raised prices paid to rice imports in June to support local farmers. copiers, also said it would start local farmers for common grade paddy rice And Indian states like Chhattisgarh could sourcing products from new by 13% from a year ago to Rs1,750 ($25.50) per announce additional payments to farmers on vendors for sale directly to cus- 100kg, with Prime Minister Narendra Modi top of the prices fi xed by the central govern- tomers in Fuji Xerox’s primary looking to woo millions of rural poor ahead of a ment, industry offi cials said. Asia-Pacific market. general election next year. “Chhattisgarh could announce a bonus of For Fuji Xerox, a breakup with The government typically buys more than around Rs200 to Rs300 (per 100kg). This will Xerox could result in the loss of a third of the country’s rice output at a fi xed further widen the gap between local and inter- over $1bn in revenue. price, which also has a direct impact on prices national prices,” said a Mumbai-based dealer But Tamai said turning to paid by traders. with a global trading fi rm. other vendors would be disad- “With this price rise, our exports will become India uses rice and wheat that it buys from vantageous for Xerox. “That expensive,” said B V Krishna Rao, president of local farmers at a fi xed price to supply subsi- would increase costs for Xerox,” the Rice Exporters Association (REA). dised food to the poor and meet any emergency he said. “It is my responsibil- “The customer base that we have created needs. ity to convince Xerox that it is over a period of time is going to shift to Thai- However, Rao of REA said that the govern- cheaper and more reasonable Farmers plant saplings in a rice field in Srinagar. India on Wednesday raised prices paid to local farmers for land and Vietnam.” ment could eventually be forced to incentivise to source products from us.” common grade paddy rice by 13% from a year ago to Rs1,750 ($25.50) per 100kg, with Prime Minister Exporters were this week off ering India 5% more overseas rice sales as its storage gets clos- Narendra Modi looking to woo millions of rural poor ahead of a general election next year. broken parboiled rice at $388-$392 per tonne er to capacity. Wednesday, July 11, 2018 GULF TIMES ISLAMIC FINANCE 5

EDUCATION/FAQ on Ijarah

What is the obligation of the lessor If there are compelling circumstances Payments are required from the lessee It is lawful in an Ijarah to promise value by developing it. In the Shafi’i primary business is transacting by to deliver the leased asset? that leave the lessee with no choice but from the time of taking possession of to make a gift of the leased asset to and Hanbali schools no such condition means of interest? The lessor is obliged to deliver the to dissolve the contract then the Ijarah the item leased from the lessor. In the the lessee when the lease expires on applies and the lessee may agree any It is unlawful for a Muslim to aid in the asset and all associated leased items will be considered dissolved from case mentioned, payments will be due condition that all payments are made amount of rent with the sub-lessee, impermissible, and leasing property to necessary to transfer the usufruct to that date. The lessor will be entitled to as soon as possession of the land is in their entirety. assuming the lessor permits sub- a company whose primary business the lessee and leave it to the lessee’s receive payment for the period of the assumed by the lessee. leasing. is interest-based would be considered disposal until the end of the lease term. contract’s validity whereas the rest will Is it permissible for the lessor impermissible. Any accident that hampers the lessee be returned to the lessee. Is it permissible to agree to withhold the leased asset if What should a lessor do upon from utilising the usufruct ‘not being upon usufruct to be used as the lessee defaults on his lease becoming aware of a lessee’s Is it lawful for the bank to agree an accident caused by the lessee’ must Is it permissible for the owner of consideration for an Ijarah rental? payments? intention to utilise a leased asset from the beginning of the lease be corrected by the lessor. a jointly-owned asset to lease the It is permissible for Ijarah rentals to be It is permissible for the lessor to for unlawful purposes? that the lessee will purchase asset to his co-owner? paid in the form of usufructs. reclaim the leased asset if the lessee If the lessor becomes aware of a supplies and equipment from May one of the parties to the It is permissible for a co-owner to lease defaults on lease payments, though lessee’s intention to utilize a leased the bank at the end of any year rental contract, before the his share of the jointly-owned asset to Is it permissible to include a clause he would not be required to do so and asset in unlawful ways, he should from among the years of a lease expiration of the rental period, another co-owner or to a third party. in an Ijarah contract absolving could grant respite. rescind the contract. Any rental contract? cancel the rental contract the lessor of all responsibilities payments earned before rescission It is not lawful for the bank to agree unilaterally? The bank leases land for the towards the leased asset such as May the lessee sub-lease the are lawful for him to accept, while from the beginning of the lease that It is impermissible for the tenant or the purpose of building a branch maintenance? leased property or service to a all subsequent rentals are unlawful. the lessee will purchase supplies and owner to cancel the rental contract off ice. The improvements on It is not permissible to include provisions third-party? However, if the core purpose of the equipment from the bank at the end before the expiration of the rental period the land and the construction in an Ijarah contract that absolve the The lessee may sub-lease the property Ijarah contract is lawful ‘such as of any year from among the years of without the consent of the other party. of the branch off ice require two lessor from his responsibilities towards or service to a third party with the leasing a car’ the Ijarah is not rendered a lease contract since it would create years before it can be opened the leased asset. lessor’s permission. In the Hanafi unlawful by any sins on the part of the gharar (contractual ambiguity leading If a lease contract is mutually for business. When is the bank school the sub-lease may only be at a lessee. to dispute) about the duration of the dissolved before it expires, is it required to begin lease payments Is it lawful for the lessor to rate less than or equal to the original lease period and when it is to begin. permissible for the bank to deduct on the land; from the time of promise the lessee to gift him the lease, though the lessee may charge What is the Shariah ruling with a part of the lease and insurance possession or from the time the leased asset on condition that the a higher rent if, with the lessor’s regard to the lease of property to Source: Ethica Institute of Islamic payments? branch off ice is opened? lease is paid in full? permission, he increases the property’s companies or institutions whose Finance via Bloomberg.

Philippines mulls euro, A new term is born: Shariah fi ntech, sukuk bonds in record 2019 and it has quite some potential funding plan

By Arno Maierbrugger Gulf Times correspondent Bloomberg Bangkok Manila

ndonesia’s Deputy Finance Min- The Philippines is planning to debut ister Mardiasmo at the country’s sukuk bonds and tap certain debt Ithird Annual Islamic Finance markets for the first time in years to Conference in Makassar on July 4 finance a budget deficit poised to widen in his opening speech was using a in 2019 to the most in almost a decade, relatively new term that will play an Treasurer Rosalia de Leon said. important role in Islamic fi nance: The Asian nation is mulling the sale “Shariah fi ntech,” meaning fi nancial of euro-denominated bonds for the technology compliant with Islamic first time since 2006 to help fund laws and beliefs. record borrowings of 1.19tn pesos Mardiasmo, who like many Indo- ($22.3bn) next year, de Leon told nesians goes by only one name, told reporters in Manila. Tapping the Islamic the audience that “to accelerate the debt market, which is something the process of strengthening the role Philippines had been exploring, may of Islamic fi nance, we need to think finally happen in 2019, she said. out of the box, including by taking “We always look for all angles in our recent technological advancement borrowing needs,” the treasurer said. into consideration,” and added that With the wider 2019 budget gap, he believed that “harnessing Shariah the nation is expanding its potential fi ntech would have a positive impact sources unlike in the past when on this issue.” financing needs were smaller and it Shariah fi ntech is clearly a new could aff ord to focus on dollar debt, buzzword to describe the venture she said. of fi nancial technology into Islamic President Rodrigo Duterte’s economic fi nance. It came into gear in the sec- managers earlier this month lifted ond half of last year, with a handful the cap on the 2019 fiscal gap to 3.2% of Shariah fi ntech events held mainly of gross domestic product, the most in Malaysia to introduce the Islamic since 2010 on higher spending planned fi nance community to this new de- on infrastructure, education and velopment. healthcare. This year, the government is The status quo is that few Islamic returning to the yen-denominated bond banks have been open to adapt new market for the first time since 2010 and technologies, pointing out that even may sell dollar-denominated notes for though technology is neutral from a second time after debuting Panda Shariah perspective in general, fi n- bonds in March. tech applications would still require “Diversification is always good and sensitivity in that aspect. Further- a healthy move by the government,” more, many scholars in Shariah A woman on a pedestrian footbridge is silhouetted as the Malayan Banking Bhd (Maybank) headquarters building stands in the distance in Kuala Lumpur. said Steven Michael Reyes, senior vice boards of established Islamic fi nan- Among Islamic banks, just a few so far are explicitly looking for talent and setting up research and development centres for Shariah fintech, for example CIMB president at Rizal Commercial Banking cial institution are possibly a bit and Maybank in Malaysia, a number of banks in the UAE, as well as Bank Mandiri and Bank Rakyat in Indonesia, among others. Corp in Manila. challenged in this particular case of The government will raise 25%, or about progress meeting tradition. peer lending and mobile payment which country will take the lead in based fi ntech incubator FinTech novations are halal, while other 297bn pesos, from external sources The result is that not Islamic banks applications, while others are de- Shariah fi ntech. Last December, a Consortium, opened in Manama. fi ntechs are endorsed by specifi c next year, de Leon said. More than half are the drivers for Shariah fi ntech; veloping blockchain solutions for consortium of three Bahraini banks However, US-based business in- fatwas. The common stance seems of that will come from overseas bond but startups, entrepreneurs and in- Islamic fi nance services, automated as a fi rst announced the establish- telligence fi rm Pew Research Center to be that innovations in fi ntech be- sales and the rest from concessional ventive enterprises. In Indonesia, for halal investment and trading plat- ment of a company dedicated to re- found in a recent study that fi ntech come impermissible only if there is loans, she said. example, and in other Asian coun- forms, robo-advisers for Islamic in- fi rms that comply with Shariah laws clear evidence that they are in con- tries with growing Muslim popula- vestments and Shariah-compliant can be found in their highest number fl ict against the basic fi nance rules tions and expanding economies, on- cryptocurrencies and initial coin of- in Malaysia, the UK and Indonesia, of Shariah. line microfi nance services are part of ferings. Gulf Times in that order, and are followed by the In Indonesia’s case, Mardiasmo this new wave of Shariah fi ntech and Among Islamic banks, just a few UAE, the US, India and Egypt. came to the conclusion that “we need mostly startups are rushing to ride it, so far are explicitly looking for talent Exclusive Islamic fi nance advisors agree to deepen understanding of Shariah Saudi is said to like BTPN Syariah and Blossom Fi- and setting up research and develop- that there is an urgent need to push knowledge among fi ntech players so nance in Indonesia or FINTQ in the ment centres for Shariah fi ntech, for search and development in the Sha- for necessary legislation and regu- that they can comply with Shariah- ask banks to southern Philippines, just to name a example CIMB and Maybank in Ma- riah fi ntech sector, ALGO Bahrain. lation, infrastructure support and based regulations.” That way, growth few. laysia, a number of banks in the UAE, In addition, in February 2018, the technology enablement for Shariah of Shariah fi ntech would become pitch for Other Shariah fi ntech startups are as well as Bank Mandiri and Bank largest dedicated fi ntech hub in the fi ntech. So far, Islamic startups are “the catalyst to increase the share of focusing on agri-fi nance platforms, Rakyat in Indonesia, among others. Middle East and Africa, Bahrain Fin- on their own, presenting complex Islamic banks in the country’s fi nan- Islamic bond sale Islamic crowdfunding, peer-to- And there is also the question Tech Bay, operated by Singapore- explanations why their fi ntech in- cial services,” he concluded. Bloomberg Dubai

Moody’s affirms Islamic Development Bank rating with stable outlook Saudi Arabia is asking banks to pitch for roles on a potential dollar-denominated Bloomberg series and with all other present and future trust paid-in capital subscriptions increase from ID5.4bn callable capital being pledged by members with Islamic bond sale that could happen in the New York certificates. The aff irmation of the Islamic Develop- as of end-2017 to ID7.8bn over the next ten years. an Baa3 rating or higher, it benefits from an ex- second half, people with knowledge of the ment Bank (IsDB)’s Aaa rating and stable outlook Although leverage was introduced in Islamic calen- ceptionally strong coverage of its debt stock, with matter said. reflect Moody’s view that the IsDB’s risk profile will dar year 1425H (2004), the increase in debt on the discounted callable capital substantially exceeding The government has sent out the Moody’s Investors Service has aff irmed the issuer remain very strong over the medium-term, sup- balance sheet has been gradual over the last 15 years, outstanding borrowings. so-called request for proposals for the rating of the Islamic Development Bank at Aaa ported by high capital adequacy ratios, low lever- executed primarily through sukuk programmes. Shareholders have a long history of active participa- possible sukuk sale to international and with a stable outlook. The Islamic Development age and a stock of callable capital from investment Consequently, the IsDB’s asset coverage ratio tion in general capital increases. In 2013, at its 38th local lenders, the people said, asking not Bank’s short-term issuer rating has been aff irmed grade shareholders roughly twice the outstanding remains very strong at 63.7%. The Islamic Develop- Annual Meeting, the Board of Governors of IDB ap- to be identified because the information is at Prime-1. debt stock. Despite the relatively low credit quality ment Bank benefits from a strong liquidity posi- proved the 5th General Capital Increase to ID100bn private. The Ministry of Finance declined The rating and outlook for the Islamic Develop- of the loan book and the challenging operating en- tion, and is considered a benchmark issuer within and subscribed capital to ID50bn in addition to the to comment. ment Bank’s two special purpose vehicles for Su- vironment, non-performing loans remain very low. the global sukuk market. calling in half of the remaining portion of the 4th Saudi Arabia has been one of the biggest kuk issuance, Tadamun Services Berhad, and IDB The IsDB’s liquidity position is strong, and market The stock of liquid assets is robust, both relative to General Capital Increase. A further ID2.4bn will be issuers in emerging markets after a drop Trust Services Limited, have also been aff irmed at access is favourable given the IsDB’s prominence the IsDB’s balance sheet and to its short-term debt. paid in across the next 10 years, bringing total paid- in oil prices prompted the kingdom to sell Aaa with a stable outlook. as one of the few top-rated Shariah compliant issu- Although IsDB’s use of Shariah compliant financing in capital to ID7.8 billion by 2027. dollar bonds less than two years ago. The senior unsecured domestic rating of Tadamun ers in the Islamic finance world. structures limits its pool of investors compared The Islamic Development Bank’s risk profile is The sale would be the kingdom’s second Services Berhad has been aff irmed at Aaa. The The Islamic Development Bank benefits from a to other Aaa-rated MDBs, it is a benchmark issuer likely to remain very strong over the medium term international bond off ering this year after backed senior unsecured rating and the backed very strong capital base, supported by a high asset within the Islamic finance world, being one of the even as its capital base expands. Although lever- it raised $11bn in April. senior unsecured MTN programme rating of IDB coverage ratio, very low NPLs, and low leverage few Aaa-rated issuers. age is expected to rise modestly over the next The world’s biggest oil exporter has plans Trust Services Limited have also been aff irmed at ratios compared to peers. Given the scarcity of high-quality Shariah compli- three years, we expect the IsDB’s asset coverage to borrow the equivalent of $31bn this Aaa and (P)Aaa respectively. The IsDB’s leverage ratio is among the lowest of the ant securities, the IsDB’s sukuks have always found ratio to remain high compared to Aaa-rated MDBs, year to bridge an expected budget deficit The rating of the certificates of Tadamun Services Aaa-rated multilateral development banks in our strong demand. The Islamic Development Bank supported by ongoing increases to paid-in capital of $52bn and fund growth plans. Berhad and IDB Trust Services Limited is in line rated universe. Although leverage ratios have begun benefits from very high strength of member support. from the 4th General Capital Increase (GCI). With oil prices recovering to above $70 a with the Aaa long-term foreign currency rating of to rise gradually commensurate with rising sukuk The IsDB’s 57 shareholders include several highly Despite a modest decline in the weighted aver- barrel, the kingdom’s finances are set to the IsDB’s Ordinary Capital Resources. issuance, we expect debt/equity ratios will remain rated sovereigns such as Saudi Arabia (A1 stable), age borrower quality of the loan book, asset improve. Moody’s regards the certificates as senior un- below the Aaa-median across the next three years. the UAE (Aa2 stable), Kuwait (Aa2 stable) and performance remains strong, supported by Fitch last month said it expects the secured obligations, without any preference or Capital adequacy will also be supported by the Qatar which together hold 45% of the IsDB’s sub- sovereign-guarantees on the vast majority of the government’s deficit to narrow to 6.4% of priority, among all trust certificates of the same ongoing general capital increase, which should see scribed capital. Despite just under half the IsDB’s IsDB’s lending. GDP in 2019 from 8.3% in 2017. Gulf Times 6 Wednesday, July 11, 2018 BUSINESS

SAUDI ARABIA KUWAIT OMAN

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

Solidarity Saudi Takaful Co 19.74 -0.70 145,442 Specialities Group Holding C 62.80 2.95 117,050 Aloula Co 0.53 0.00 - Amana Cooperative Insurance 21.62 1.03 1,909,659 Abyaar Real Eastate Developm 19.90 2.05 13,486,517 Al-Omaniya Financial Service 0.28 0.00 - Alabdullatif Industrial Inv 12.34 0.16 102,114 Kgl Logistics Company Kscc 45.10 1.12 14,955,714 Al-Hassan Engineering Co 0.04 0.00 - Saudi Printing & Packaging C 18.54 0.76 435,931 Combined Group Contracting 403.00 -6.06 103,900 Al-Fajar Al-Alamia Co 0.75 0.00 - Saudi Paper Manufacturing Co 7.84 -0.25 249,625 Jiyad Holding Co Ksc 94.50 -5.50 672,991 Al-Anwar Ceramic Tiles Co 0.10 0.00 271,200 Alinma Bank 21.54 1.13 26,958,510 Boubyan Intl Industries Hold 30.00 -6.25 554,510 Al Suwadi Power 0.12 0.00 - Almarai Co 58.40 -0.68 269,048 Gulf Investment House Ksc 18.20 1.68 1,388,610 Al Sharqiya Invest Holding 0.11 0.00 90,000 Falcom Saudi Equity Etf 32.30 1.25 160,564 Boubyan Bank K.S.C 520.00 0.19 1,968,296 Al Maha Petroleum Products M 0.72 0.00 1,391 United International Transpo 33.95 0.00 210,236 Ahli United Bank B.S.C 198.00 1.54 5,223,027 Al Maha Ceramics Co Saoc 0.22 0.00 - Hsbc Amanah Saudi 20 Etf 33.05 2.01 1,312 Osos Holding Group Co 85.00 0.00 59,910 Al Madina Takaful Co Saoc 0.09 -1.05 275,905 QATAR Saudi International Petroche 23.36 -0.26 1,088,143 Al-Eid Food Ksc 65.30 0.00 600 Al Madina Investment Co 0.05 -6.00 92,550 Falcom Petrochemical Etf 31.90 0.00 22 Qurain Petrochemical Industr 346.00 0.29 649,289 Al Kamil Power Co 0.39 0.00 - Company Name Lt Price % Chg Volume Walaa Cooperative Insurance 28.25 0.53 91,975 Ekttitab Holding Co Sak 27.30 -0.36 1,669,486 Al Jazerah Services -Pfd 0.55 0.00 - Bank Al-Jazira 14.74 0.55 4,228,038 Real Estate Trade Centers Co 20.00 0.00 21,600 Al Jazeera Steel Products Co 0.30 0.00 - Zad Holding Co 86.60 0.10 557 Al Rajhi Bank 88.00 1.38 2,758,787 Acico Industries Co Kscc 241.00 0.00 54,666 Al Jazeera Services 0.11 -5.83 708,368 Widam Food Co 63.40 -0.16 11,045 Samba Financial Group 32.85 3.30 1,141,217 Kipco Asset Management Co 74.70 6.71 10,000 Al Izz Islamic Bank 0.08 0.00 - Vodafone Qatar 9.24 0.43 4,968,730 United Electronics Co 58.40 2.28 371,147 National Petroleum Services 740.00 -0.13 8,743 Al Buraimi Hotel 0.88 0.00 - United Development Co 14.10 -0.07 444,462 Allied Cooperative Insurance 18.36 -0.33 268,383 Alimtiaz Investment Co Kscc 140.00 0.72 1,387,290 Al Batinah Power 0.12 0.00 - Salam International Investme 5.26 -0.75 189,276 Malath Insurance 14.58 0.55 177,040 Ras Al Khaimah White Cement 72.00 -0.14 900,209 Al Batinah Hotels 1.13 0.00 - Qatar & Oman Investment Co 6.32 0.64 8,947 Alinma Tokio Marine 19.70 -1.99 296,563 Kuwait Reinsurance Co Ksc 190.00 0.00 5,500 Al Batinah Dev & Inv 0.10 0.00 - Qatar Navigation 64.90 1.31 48,691 Arabian Shield Cooperative 25.75 -1.34 105,560 Kuwait & Gulf Link Transport 115.00 0.00 568,857 Al Anwar Holdings Saog 0.12 -1.67 59,736 Qatar National Cement Co 57.45 0.61 8,414 Savola 35.90 0.56 767,155 Human Soft Holding Co Ksc 3,699.00 -0.03 12,071 Al Ahlia Insurance Co Saoc 0.37 0.00 - Qatar National Bank 159.90 2.17 143,342 Wafrah For Industry And Deve 14.10 0.00 50,560 Automated Systems Co Kscc 121.00 -4.72 1,500 Ahli Bank 0.16 -1.23 379,000 Qatar Islamic Insurance 52.00 3.79 250 Fitaihi Holding Group 12.24 0.49 324,469 Metal & Recycling Co 50.00 0.00 3,159 Acwa Power Barka Saog 0.74 0.00 - Qatar Industrial Manufactur 40.50 0.00 2,300 Tourism Enterprise Co/ Shams 32.90 -0.30 62,081 Gulf Franchising Holding Co 21.00 0.00 11,393 Abrasives Manufacturing Co S 0.05 0.00 - Qatar International Islamic 54.39 1.66 29,626 Sahara Petrochemical Co 18.90 0.53 3,475,082 Al-Enma’a Real Estate Co 33.70 0.60 149,000 A’saff a Foods Saog 0.59 0.00 - Qatari Investors Group 31.50 1.29 23,942 Herfy Food Services Co 45.10 0.67 25,171 National Mobile Telecommuni 850.00 -0.12 4,573 0Man Oil Marketing Co-Pref 0.25 0.00 - Qatar Islamic Bank 122.50 2.76 96,954 Saudi Ind Investment Group 30.10 0.50 667,621 Unicap Investment And Financ 56.50 2.73 20,000 #N/A Invalid Security 0.00 0.00 - Qatar Gas Transport(Nakilat) 15.94 0.57 539,773 Salama Cooperative Insurance 20.70 -1.15 165,623 Al Salam Group Holding Co 34.60 1.76 1,218,500 #N/A Invalid Security 0.00 0.00 - Qatar General Insurance & Re 50.00 0.00 - Emaar Economic City 11.64 0.17 613,621 Al Aman Investment Company 51.00 6.25 10 #N/A Invalid Security 0.00 0.00 - Qatar German Co For Medical 5.30 0.95 4,400 Alahli Takaful Co 28.80 0.70 99,909 Mashaer Holding Co Ksc 50.40 2.86 2,506,050 #N/A Invalid Security 0.00 0.00 - Qatar Fuel Qsc 146.00 -0.67 114,298 Anaam International Holding 11.60 1.75 244,105 Manazel Holding 34.20 1.48 1,366,600 #N/A Invalid Security 0.00 0.00 - Qatar First Bank 5.50 0.00 249,390 Saudi Telecom Co 87.00 1.16 430,078 Tijara And Real Estate Inves 0.00 0.00 - #N/A Invalid Security 0.00 0.00 - Qatar Electricity & Water Co 189.00 0.35 47,555 Al Alamiya Cooperative Insur 31.00 0.65 22,315 Jazeera Airways Co Ksc 748.00 0.00 4,654 #N/A Invalid Security 0.00 0.00 - Qatar Exchange Index Etf 91.50 -0.54 6,750 Saudi Industrial Services Co 14.70 -0.41 421,017 Commercial Real Estate Co 75.30 1.62 804,566 Qatar Cinema & Film Distrib 16.26 0.00 - Al-Ahsa Development Co. 11.22 0.36 358,337 National International Co 59.90 0.00 4,900 Al Rayan Qatar Etf 21.95 -0.68 3,574 National Co For Glass In/The 19.72 0.10 15,885 Taameer Real Estate Invest C 31.10 2.98 785,819 Qatar Insurance Co 34.55 0.44 359,939 Dur Hospitality Co 19.76 0.82 7,848 Gulf Cement Co 76.80 1.05 10,400 Ooredoo Qpsc 73.95 2.08 316,001 Tabuk Cement Co 13.36 0.91 294,776 Heavy Engineering And Ship B 353.00 0.28 266,366 UAE National Leasing 9.45 0.00 5,429 Sasco 15.62 1.43 529,964 National Real Estate Co 123.00 4.24 3,266,674 Mazaya Qatar Real Estate Dev 7.09 -1.39 331,679 Saudi Cement 49.95 1.22 100,046 Al Safat Energy Holding Comp 31.00 3.33 151,110 Company Name Lt Price % Chg Volume Mesaieed Petrochemical Holdi 15.39 0.59 151,001 Aseer Trading Tourism & Manu 11.64 -0.34 191,763 Kuwait National Cinema Co 1,045.00 0.00 500 Al Meera Consumer Goods Co 151.00 -0.66 5,034 Nama Chemicals Co 30.50 0.33 1,820,974 Danah Alsafat Foodstuff Co 49.50 1.02 25,000 Waha Capital Pjsc 1.81 2.84 849,539 Medicare Group 70.00 3.02 116,082 Saudi Arabian Mining Co 57.50 -0.52 362,752 Independent Petroleum Group 449.00 0.00 1,000 United Insurance Company 2.00 0.00 - Mannai Corporation Qsc 50.00 3.82 5,719 Yanbu Cement Co 26.50 0.00 131,716 Kuwait Real Estate Co Ksc 51.50 3.21 1,836,931 United Arab Bank Pjsc 1.01 0.00 - Masraf Al Rayan 35.90 0.42 455,537 Saudi Fisheries 25.65 0.59 152,293 Salhia Real Estate Co Ksc 328.00 -2.09 236,520 Union National Bank/Abu Dhab 3.60 -1.37 1,113,913 Al Khalij Commercial Bank 10.85 0.46 4,752 Ash-Sharqiyah Development Co 53.00 2.91 244,769 Gulf Cable & Electrical Ind 386.00 1.05 178,565 Union Insurance Co 2.03 0.00 - Industries Qatar 114.90 2.11 161,138 Makkah Construction & Devepl 83.50 1.83 199,541 Kuwait Finance House 0.00 0.00 - Union Cement Co 1.85 0.00 - Islamic Holding Group 28.88 -0.41 10,972 Al Jouf Cement 9.31 0.54 295,257 Gulf North Africa Holding Co 46.70 1.74 1,261,364 Umm Al Qaiwain General Inves 1.01 0.00 - Investment Holding Group 5.51 0.73 151,276 Abdullah A.M. Al-Khodari Son 7.52 0.80 733,315 Hilal Cement Co 115.00 0.00 10 Sudan Telecommunications Gro 0.52 0.00 200,000 Gulf Warehousing Company 42.62 0.52 8,708 Knowledge Economic City 11.60 0.00 301,070 Osoul Investment Kscc 56.90 0.00 226,015 Sharjah Islamic Bank 1.20 0.00 151,747 Gulf International Services 17.27 -0.46 78,317 Al-Ahlia Cooperative Insuran 11.16 -0.71 116,122 Gulf Insurance Group Ksc 645.00 0.00 22,500 Sharjah Insurance Company 2.84 0.00 - Ezdan Holding Group 8.20 0.37 236,543 Al Rajhi Co For Co-Operative 58.10 -2.84 346,474 Umm Al Qaiwain General Inves 73.00 0.00 40,000 Sharjah Group 1.32 0.00 - Doha Insurance Co 13.50 0.00 440 Alkhodar Ab Equity 56.90 1.25 299,753 Aayan Leasing & Investment 33.00 2.17 7,902,838 Sharjah Cement & Indus Devel 0.96 0.00 - Doha Bank Qpsc 27.13 -0.22 197,505 Kec Ab Equity 24.70 -0.40 191,236 Alrai Media Group Co Ksc 103.00 3.00 61,404 Ras Al-Khaimah National Insu 3.50 0.00 - Dlala Holding 16.15 -0.80 298,265 Alahlia Ab Equity 27.50 0.18 79,800 National Investments Co 95.20 -0.73 227,000 Ras Al Khaimah White Cement 1.02 0.00 - Commercial Bank Pqsc 39.98 1.50 285,108 Arcci Ab Equity 9.12 0.00 823,202 Commercial Facilities Co 170.00 -1.16 92,343 Ras Al Khaimah Ceramics 2.37 0.00 200,000 Barwa Real Estate Co 36.01 0.59 274,298 Appc Ab Equity 25.90 -0.19 493,385 Yiaco Medical Co. K.S.C.C 136.00 8.80 100 Ras Al Khaimah Cement Co Psc 0.74 0.00 784,565 Al Khaleej Takaful Group 11.03 -2.13 291,220 Albabtai Ab Equity 48.80 1.04 1,069,322 Munshaat Real Estate Project 92.00 -1.60 183,000 Ras Al Khaima Poultry 1.89 0.00 - Aamal Co 9.54 0.95 29,760 Noor Financial Investment Co 55.60 2.39 1,406,843 Rak Properties 0.66 1.54 4,045,902 Al Tamdeen Investment Co 0.00 0.00 - Ooredoo Qpsc 72.90 0.00 - KUWAIT Credit Rating & Collection 21.50 0.00 979 Oman & Emirates Inv(Emir)50% 0.51 2.00 403 Ifa Hotels & Resorts Co. K.S 110.00 0.00 3,010 National Takaful Company 0.66 0.00 - SAUDI ARABIA National Marine Dredging Co 3.01 0.00 - Company Name Lt Price % Chg Volume Sokouk Holding Co Sak 42.70 0.23 463,114 Warba Bank Kscp 221.00 2.31 5,536,286 National Investor Co/The 0.58 0.00 - Company Name Lt Price % Chg Volume Sultan Center Food Products 73.00 4.29 151,234 Viva Kuwait Telecom Co 738.00 0.54 13,920 National Corp Tourism & Hote 1.99 0.00 - Kuwait Foundry Co Sak 199.00 0.00 20,000 Mezzan Holding Co Kscc 770.00 1.32 377,000 National Bank Of Umm Al Qaiw 2.66 0.00 - United Wire Factories Compan 17.16 0.82 44,211 Kuwait Financial Centre Sak 104.00 0.00 8,328 National Bank Of Ras Al-Khai 4.21 -2.09 49,000 Etihad Etisalat Co 19.38 4.42 5,069,613 Ajial Real Estate Entmt 148.00 0.00 150 National Bank Of Fujairah 3.06 0.00 - Dar Al Arkan Real Estate Dev 10.28 0.78 18,072,607 Kuwait Finance & Investment 48.00 0.00 28,000 Methaq Takaful Insurance 0.77 0.00 510,115 Alawwal Bank 14.60 1.39 888,549 National Industries Co Ksc 171.00 0.00 5 OMAN Manazel Real Estate Pjsc 0.46 2.22 4,381,466 Rabigh Refining And Petroche 28.05 1.26 1,602,562 Kuwait Real Estate Holding C 30.70 0.00 101,000 Invest Bank 2.40 -2.44 4,537 Banque Saudi Fransi 36.70 1.66 259,299 Company Name Lt Price % Chg Volume Securities House/The 48.30 0.21 700,961 Intl Holdings Co Pjsc 1.33 1.53 2,000 Saudi Enaya Cooperative Insu 23.94 -1.07 498,270 Voltamp Energy Saog 0.00 Boubyan Petrochemicals Co 935.00 0.54 256,050 0.26 - Insurance House 0.85 0.00 - Mediterranean & Gulf Insuran 21.86 -0.46 73,117 Vision Insurance Saoc 0.00 Al Ahli Bank Of Kuwait 338.00 -0.29 500,025 0.15 20,000 Gulf Pharmaceutical Ind Psc 2.30 6.98 2,246 Saudi British Bank 32.40 2.69 545,523 United Power/Energy Co- Pref 0.00 Ahli United Bank (Almutahed) 286.00 0.70 350,615 1.00 - Gulf Medical Projects 1.78 0.00 - Red Sea International Co 18.26 -0.22 91,462 United Power Co Saog 0.00 National Bank Of Kuwait 803.00 0.63 7,989,868 3.44 - Gulf Cement Co 1.03 0.00 - Takween Advanced Industries 10.78 1.51 662,416 United Finance Co 0.00 Commercial Bank Of Kuwait 500.00 2.04 26,922 0.11 - Fujairah Cement Industries 1.20 0.00 - Sabb Takaful 21.50 0.00 398,463 Ubar Hotels & Resorts 0.00 Kuwait International Bank 247.00 3.35 7,779,296 0.13 - Fujairah Building Industries 1.56 0.00 - Saudi Arabian Fertilizer Co 64.00 0.47 713,709 Takaful Oman 0.00 Gulf Bank 247.00 1.65 6,878,497 0.13 - Foodco Holding Pjsc 3.50 0.00 - National Gypsum 12.90 -0.46 120,193 Taageer Finance 0.00 Al-Massaleh Real Estate Co 43.80 15.57 1,178,105 0.11 - First Abu Dhabi Bank Pjsc 12.40 1.64 4,518,973 Saudi Ceramic Co 19.52 0.31 37,968 Sweets Of Oman 0.00 Al Arabiya Real Estate Co 33.00 -0.90 975,111 0.55 - Finance House 1.80 0.00 - National Gas & Industrializa 30.30 -0.49 151,543 Sohar Power Co -0.88 Kuwait Remal Real Estate Co 0.00 0.00 - 0.11 21,873 Eshraq Properties Co Pjsc 0.65 0.00 4,222,338 Saudi Pharmaceutical Industr 32.55 1.88 580,826 Sohar Poultry 0.00 A’ayan Real Estate Co Sak 56.00 2.75 764,600 0.21 - Emirates Telecom Group Co 17.10 0.88 1,713,727 Thimar 28.75 0.70 180,171 Smn Power Holding Saog 0.00 Investors Holding Group Co.K 15.40 14.07 15,368,528 0.60 - Emirates Insurance Co. (Psc) 7.20 0.00 - National Industrialization C 23.78 0.34 1,953,052 Shell Oman Marketing - Pref 0.00 Al-Mazaya Holding Co 89.90 2.16 916,482 1.05 - Emirates Driving Company 7.40 0.00 - Batic Investments And Logist 40.25 1.26 103,318 Shell Oman Marketing 0.00 Al-Madar Finance & Invt Co 84.30 0.36 658,000 1.49 20 Dana Gas 1.03 0.00 8,322,997 Saudi Electricity Co 20.88 0.19 1,053,405 Sharqiyah Desalination Co Sa 0.00 Gulf Petroleum Investment 27.80 6.11 5,304,902 2.52 - Commercial Bank Internationa 0.73 0.00 - Saudi Arabia Refineries Co 44.45 1.72 574,877 Sembcorp Salalah Power & Wat 0.00 Mabanee Co Sakc 662.00 1.22 1,089,751 0.23 - Bank Of Sharjah 1.06 0.00 - Arriyadh Development Company 17.20 0.70 172,757 Salalah Port Services 0.00 Inovest Co Bsc 75.60 -0.13 65,502 0.60 - Axa Green Crescent Insurance 0.54 0.00 - Al-Baha Development & Invest 19.86 0.30 70,560 Salalah Mills Co 0.00 Al-Deera Holding Co 19.40 -5.37 181,350 1.08 - Arkan Building Materials Co 0.59 1.72 150,700 Saudi Research And Marketing 91.20 -0.65 124,884 Salalah Beach Resort Saog 0.00 Mena Real Estate Co 29.60 0.34 3,052 1.38 - Alkhaleej Investment 2.30 0.00 - Aldrees Petroleum And Transp 29.50 0.00 243,677 Sahara Hospitality 0.00 Amar Finance & Leasing Co 38.00 0.00 1 2.38 - Aldar Properties Pjsc 2.10 2.44 4,901,116 Saudi Vitrified Clay Pipe Co 49.50 0.30 18,030 Renaissance Services Saog -0.44 United Projects For Aviation 605.00 0.00 10 0.45 521,324 Al Wathba National Insurance 12.75 0.00 - Jarir Marketing Co 180.00 -0.33 47,868 Raysut Cement Co 0.00 National Consumer Holding Co 84.00 0.00 100 0.60 - Al Qudra Holding Pjsc 1.08 0.00 - Arab National Bank 33.85 2.89 253,532 Phoenix Power Co Saoc 0.00 Amwal International Investme 54.00 -2.70 370,100 0.12 2,700 Al Khazna Insurance Co 0.25 0.00 - Yanbu National Petrochemical 77.00 0.00 224,649 Packaging Co Ltd 0.00 Equipment Holding Co K.S.C.C 29.50 1.37 984,346 2.21 - Al Fujairah National Insuran 300.00 0.00 - Arabian Cement 27.60 0.18 187,810 Ooredoo -0.75 Arkan Al Kuwait Real Estate 78.00 2.09 20,000 0.53 32,730 Al Dhafra Insurance Co. P.S. 3.85 0.00 - Middle East Specialized Cabl 8.02 0.38 914,536 Ominvest 0.00 Gfh Financial Group Bsc 111.00 1.83 10,751,178 0.35 - Al Buhaira National Insuranc 2.20 0.00 - Al Khaleej Training And Educ 15.78 -0.13 83,190 Oman United Insurance Co 0.00 Energy House Holding Co Kscp 29.00 0.00 39,949 0.31 - Al Ain Ahlia Ins. Co. 38.00 0.00 - Al Sagr Co-Operative Insuran 26.60 -1.30 225,196 Oman Telecommunications Co 0.00 Kuwait Co For Process Plant 160.00 0.00 9,850 0.72 2,145 Agthia Group Pjsc 4.85 0.00 66,500 Trade Union Cooperative Insu 23.04 0.17 106,384 Oman Refreshment Co 0.00 Al Maidan Dental Clinic Co K 0.00 0.00 - 1.75 - Abu Dhabi Ship Building Co 1.84 0.00 - Arabia Insurance Cooperative 20.16 -1.18 112,384 Oman Qatar Insurance Co 0.00 National Shooting Company 19.50 12.72 2,145,500 0.11 - Abu Dhabi Natl Co For Buildi 0.52 4.00 209,700 Saudi Chemical Company 35.00 0.29 45,251 Oman Packaging 0.00 Al-Ahleia Insurance Co Sakp 430.00 1.18 110,000 0.28 - Abu Dhabi National Takaful C 4.40 0.00 - Fawaz Abdulaziz Alhokair & C 20.92 1.16 1,031,505 Oman Oil Marketing Company 0.00 Wethaq Takaful Insurance Co 27.70 1.84 1,153,476 1.15 - Abu Dhabi National Oil Co Fo 2.42 0.00 207,616 Bupa Arabia For Cooperative 88.30 0.46 44,119 Oman National Engineering An -9.04 Salbookh Trading Co Kscp 47.90 4.13 321,541 0.15 45,000 Abu Dhabi National Insurance 3.90 0.00 - Wafa Insurance 14.18 -0.56 272,929 Oman Investment & Finance -1.83 Aqar Real Estate Investments 69.00 -1.43 10,000 0.11 39,900 Abu Dhabi National Hotels 2.86 0.00 - Jabal Omar Development Co 44.00 3.53 1,689,569 Oman Intl Marketing 0.00 Hayat Communications 59.00 0.00 50 0.52 - Abu Dhabi National Energy Co 1.21 0.83 130,000 Saudi Basic Industries Corp 127.00 0.95 5,441,032 Oman Flour Mills 0.00 Soor Fuel Marketing Co Ksc 132.00 2.33 839,035 0.79 - Saudi Kayan Petrochemical Co 16.72 0.84 12,024,672 Oman Fisheries Co -5.45 Tamkeen Holding Co 14.00 0.00 50,000 0.10 20,000 Etihad Atheeb Telecommunicat 5.35 0.00 - Oman Europe Foods Industries 0.00 Burgan Co For Well Drilling 85.00 0.00 4 1.00 - Co For Cooperative Insurance 68.80 -0.29 102,113 Oman Education & Training In 0.00 BAHRAIN Kuwait Resorts Co Kscc 55.90 0.36 899,590 0.19 - National Petrochemical Co 29.40 1.38 587,957 Oman Chromite 0.00 Oula Fuel Marketing Co 130.00 4.00 127,206 3.64 - Gulf Union Cooperative Insur 15.36 0.13 37,974 Oman Chlorine 0.00 Palms Agro Production Co 0.00 0.00 - 0.40 - Company Name Lt Price % Chg Volume Gulf General Cooperative Ins 15.94 -0.25 53,306 Oman Ceramic Company 0.00 Mubarrad Holding Co Ksc 61.00 0.33 87,901 0.42 - Basic Chemical Industries 25.30 2.43 373,486 Oman Cement Co 0.00 Zain Bahrain Bscc 0.00 0.00 - Shuaiba Industrial Co 249.00 0.00 1,797 0.38 47,175 Saudi Steel Pipe Co 19.88 -0.50 163,020 Oman Cables Industry 0.00 United Paper Industries Bsc 0.00 0.00 - Aan Digital Services Co 20.80 4.52 1,197,617 0.89 - Buruj Cooperative Insurance 30.70 0.66 68,028 Oman & Emirates Inv(Om)50% 0.00 United Gulf Holding Bsc 1.12 0.00 30,000 First Takaful Insurance Co 43.00 -3.80 20 0.11 65,500 Mouwasat Medical Services Co 95.50 0.42 71,217 Natl Aluminium Products 0.00 Trafco Group Bsc 0.00 0.00 - Kuwaiti Syrian Holding Co 31.30 1.62 416,305 0.36 - Southern Province Cement Co 40.20 0.12 61,053 National Securities 0.00 Takaful International Co 0.00 0.00 - National Cleaning Company 53.90 0.00 3,951 0.04 - Maadaniyah 19.16 2.46 136,395 National Real Estate Develop 0.00 Seef Properties 0.23 0.00 20,000 United Real Estate Company 63.50 0.00 637,000 5.00 - Yamama Cement Co 16.20 0.87 331,613 National Pharmaceutical 0.00 National Bank Of Bahrain Bsc 0.59 -0.84 378,904 Agility 849.00 1.07 1,193,958 0.12 - Jazan Energy And Development 15.94 -0.38 120,863 National Mineral Water 0.00 Nass Corp Bsc 0.10 -0.97 200,000 Kuwait & Middle East Fin Inv 26.40 17.33 389,836 0.10 - Zamil Industrial Investment 23.90 -0.25 111,093 National Life & General Insu 0.00 Khaleeji Commercial Bank 0.10 -3.00 86,000 Fujairah Cement Industries 69.00 0.00 99,396 0.32 - Alujain Corporation (Alco) 33.80 2.27 1,279,193 National Gas Co 0.00 Ithmaar Holding Bsc 0.11 4.76 150,000 Livestock Transport & Tradng 186.00 0.00 33 0.33 106,232 Tabuk Agricultural Developme 11.24 -0.18 102,810 National Finance Co -1.50 Investcorp Bank -$Us 0.00 0.00 - International Resorts Co 23.30 2.64 533,350 0.13 35,888 United Co-Operative Assuranc 13.90 -1.56 798,917 National Detergent Co Saog 0.00 Inovest Co Bsc 0.28 0.00 50,000 National Industries Grp Hold 166.00 1.84 8,265,719 0.67 - Qassim Cement/The 38.90 1.17 55,046 National Biscuit Industries 0.00 Gulf Hotel Group B.S.C 0.52 0.00 18,085 Warba Insurance Co 66.30 3.59 53,234 3.75 - Saudi Advanced Industries 13.26 0.15 102,075 National Bank Of Oman Saog -1.66 Gfh Financial Group Bsc 0.39 -1.27 1,186,500 First Dubai Real Estate Deve 42.00 0.00 377,510 0.18 38,469 Kingdom Holding Co 8.80 0.00 110,900 Muscat Thread Mills Co 0.00 Esterad Investment Co B.S.C. 0.00 0.00 - Al Arabi Group Holding Co 72.60 0.83 94,542 0.08 - Saudi Arabian Amiantit Co 6.62 1.53 592,148 Muscat Insurance Co Saog 0.00 Eskan Bank Realty Income Tr 0.10 0.00 59,000 Mobile Telecommunications Co 488.00 1.46 2,616,177 0.80 - Al Jouf Agriculture Developm 25.20 -0.40 92,196 Muscat Gases Company Saog 0.00 Delmon Poultry Co 0.00 0.00 - Eff ect Real Estate Co 21.00 0.00 100 0.32 - Saudi Industrial Development 9.05 0.11 116,352 Muscat Finance -1.19 Bmmi Bsc 0.72 0.00 150,000 Tamdeen Real Estate Co Ksc 384.00 0.00 8 0.08 53,500 Riyad Bank 16.98 2.29 1,101,303 Muscat City Desalination Co 0.00 Bbk Bsc 0.45 0.45 10,000 Al Mudon Intl Real Estate Co 29.50 0.00 95,200 0.14 - The National Agriculture Dev 35.35 -0.42 34,800 Majan Glass Company 0.00 Bahrain Telecom Co 0.24 -0.83 300,000 Kuwait Cement Co Ksc 400.00 0.00 10,100 0.18 - Halwani Bros Co 52.50 -0.38 4,926 Majan College 0.00 Bahrain National Holding 0.44 0.00 7,579 Sharjah Cement & Indus Devel 79.00 0.00 5,000 0.45 - Arabian Pipes Co 12.36 1.15 662,885 Hsbc Bank Oman -1.75 Bahrain Kuwait Insurance 0.00 0.00 - Kuwait Portland Cement Co 1,100.00 3.68 31,611 0.11 252,537 Eastern Province Cement Co 24.10 1.35 39,169 Hotels Management Co Interna 0.00 Bahrain Islamic Bank 0.13 0.00 103,603 Educational Holding Group 320.00 0.00 1,303 1.25 - Al Gassim Investment Holding 12.04 -0.50 206,469 Gulf Stone 0.00 Bahrain Flour Mills Co 0.00 0.00 - Asiya Capital Investments Co 38.50 0.00 361,621 0.12 - Filing & Packing Materials M 36.20 0.56 95,416 Gulf Mushroom Company 0.00 Bahrain Duty Free Complex 0.72 0.00 5,347 Kuwait Investment Co 124.00 1.64 234,559 0.31 - Saudi Cable Co 7.99 -0.13 146,829 Gulf Investments Services -2.15 Bahrain Commercial Facilitie 0.76 0.00 3,000 Burgan Bank 271.00 0.37 1,117,585 0.09 125,000 Tihama Advertising & Public 47.70 1.60 303,558 Gulf Invest. Serv. Pref-Shar 0.00 Bahrain Cinema Co ` 0.00 8,000 Kuwait Projects Co Holdings 246.00 -0.81 1,149,960 0.11 - Saudi Investment Bank/The 18.50 0.98 161,985 Gulf International Chemicals 0.00 Arab Banking Corp Bsc-$Us 0.38 0.00 335,000 Al Madina For Finance And In 28.60 0.35 1,634,233 0.20 900 Astra Industrial Group 19.72 3.79 879,139 Gulf Hotels (Oman) Co Ltd 0.00 Aluminium Bahrain Bsc 0.63 0.00 1,580 Kuwait Insurance Co 295.00 0.00 2,091 9.50 - Saudi Public Transport Co 14.66 0.00 207,306 Global Fin Investment -6.00 Albaraka Banking Group 0.30 0.00 19,000 Al Masaken Intl Real Estate 65.00 0.00 1,000 0.09 26,109 Taiba Holding Co 31.00 0.00 60,523 Galfar Engineering&Contract -2.91 Al-Salam Bank 0.11 0.00 40,000 Intl Financial Advisors 26.80 1.90 962,441 0.10 2,586,100 Saudi Industrial Export Co 229.40 -0.17 47,266 Galfar Engineering -Prefer 0.00 Ahli United Bank B.S.C 0.64 0.79 368,107 First Investment Co Kscc 42.20 3.18 1,308,730 0.39 - Saudi Real Estate Co 14.22 -1.52 428,322 Financial Services Co. 0.00 #N/A Invalid Security 0.00 0.00 - Al Mal Investment Company 20.00 3.09 959,181 0.18 - Saudia Dairy & Foodstuff Co 93.00 0.98 109,767 Financial Corp/The 0.00 #N/A Invalid Security 0.00 0.00 - Bayan Investment Co Kscc 43.20 4.85 656,350 0.10 - National Shipping Co Of/The 30.25 -0.98 433,238 Dhofar Tourism 0.00 #N/A Invalid Security 0.00 0.00 - Egypt Kuwait Holding Co Sae 334.00 0.00 20,000 0.49 - Methanol Chemicals Co 10.32 1.57 4,458,063 Dhofar Poultry 0.00 #N/A Invalid Security 0.00 0.00 - Coast Investment Development 33.90 1.19 1,013,172 0.18 - Chubb Arabia Cooperative Ins 22.70 0.09 40,923 Dhofar Intl Development 0.00 #N/A Invalid Security 0.00 0.00 - Privatization Holding Compan 63.00 0.80 82,100 0.31 - Mobile Telecommunications Co 6.34 2.42 2,695,019 Dhofar Insurance 0.00 #N/A Invalid Security 0.00 0.00 - Injazzat Real State Company 85.00 0.00 25,900 0.16 - Saudi Arabian Coop Ins Co 15.02 -0.92 78,859 Dhofar Fisheries & Food Indu 0.00 #N/A Invalid Security 0.00 0.00 - Kuwait Cable Vision Sak 8.00 0.00 293 1.28 - Axa Cooperative Insurance 22.52 2.46 253,515 Dhofar Cattlefeed 0.00 #N/A Invalid Security 0.00 0.00 - Sanam Real Estate Co Kscc 25.80 -9.47 188 0.17 - Alsorayai Group 13.68 0.59 1,309,240 Dhofar Beverages Co 0.00 #N/A Invalid Security 0.00 0.00 - Ithmaar Holding Bsc 33.50 1.52 10,796,020 0.26 - Bank Albilad 24.70 2.92 1,246,433 Construction Materials Ind 0.00 #N/A Invalid Security 0.00 0.00 - Aviation Lease And Finance C 357.00 2.29 519,416 0.03 - Al-Hassan G.I. Shaker Co 11.28 0.18 445,593 Computer Stationery Inds 0.00 #N/A Invalid Security 0.00 0.00 - Arzan Financial Group For Fi 29.90 0.34 80,601 0.26 - Wataniya Insurance Co 26.20 -0.19 31,677 Bankmuscat Saog 0.00 #N/A Invalid Security 0.00 0.00 - Ajwan Gulf Real Estate Co 22.60 1.35 2,328,720 0.38 824,881 Abdullah Al Othaim Markets 75.40 -0.13 22,801 Bank Sohar 0.00 #N/A Invalid Security 0.00 0.00 - Kuwait Business Town Real Es 44.90 0.22 254,743 0.14 10,360 Hail Cement 9.02 0.67 125,834 Bank Nizwa 0.00 Future Kid Entertainment And 110.00 8.91 500 0.09 22,199 Saudi Re For Cooperative Rei 8.42 -1.75 1,086,218 Bank Dhofar Saog 0.17 0.00 - LATEST MARKET CLOSING FIGURES Gulf Times Wednesday, July 11, 2018 7 BUSINESS

DJIA WORLD INDICES Company Name Lt Price % Chg Volume Indices Lt Price Change Dow Jones Indus. Avg 24,926.12 +149.53 Apple Inc 191.05 0.25 6,972,363 S&P 500 Index 2,793.32 +9.15 Microsoft Corp 102.37 0.51 7,005,547 Nasdaq Composite Index 7,770.15 +13.94 Exxon Mobil Corp 83.69 0.95 3,974,526 S&P/Tsx Composite Index 16,509.68 +57.34 Johnson & Johnson 126.66 0.48 1,455,687 Mexico Bolsa Index 48,938.68 -297.12 General Electric Co 14.08 0.93 21,571,348 Brazil Bovespa Stock Idx 75,141.79 +131.40 Jpmorgan Chase & Co 107.32 0.04 6,410,817 Ftse 100 Index 7,692.04 +4.05 Procter & Gamble Co/The 79.26 1.80 5,990,179 Cac 40 Index 5,434.36 +36.25 Walmart Inc 86.74 0.94 2,000,574 Dax Index 12,609.85 +65.96 Verizon Communications Inc 51.02 0.55 2,821,954 Ibex 35 Tr 9,889.30 -37.70 Pfizer Inc 37.36 0.52 4,623,161 Nikkei 225 22,196.89 +144.71 Visa Inc-Class A Shares 137.20 1.24 2,651,326 Japan Topix 1,716.13 +4.34 Chevron Corp 127.59 1.27 1,948,962 Hang Seng Index 28,682.25 -6.25 Coca-Cola Co/The 44.87 1.06 3,580,213 All Ordinaries Indx 6,342.76 -23.64 Intel Corp 52.09 0.44 5,595,577 Nzx All Index 1,596.47 -6.31 Merck & Co. Inc. 62.37 0.56 3,244,797 Bse Sensex 30 Index 36,239.62 +304.90 Cisco Systems Inc 42.85 0.41 9,204,333 Nse S&P Cnx Nifty Index 10,947.25 +94.35 Home Depot Inc 197.55 0.75 1,008,594 Straits Times Index 3,274.83 +46.01 Intl Business Machines Corp 144.73 0.24 1,348,799 Karachi All Share Index 28,946.66 +56.06 Walt Disney Co/The 105.92 -0.09 1,843,361 Jakarta Composite Index 5,881.76 +74.39 Unitedhealth Group Inc 256.30 1.04 797,242 3M Co 201.02 0.24 673,586 Mcdonald’s Corp 160.60 0.41 781,200 Nike Inc -Cl B 77.60 0.41 2,106,226 TOKYO United Technologies Corp 126.78 0.08 1,116,391 Boeing Co/The 346.87 1.45 1,580,233 Company Name Lt Price % Chg Volume Goldman Sachs Group Inc 227.95 -0.02 1,343,884 Sumitomo Realty & Developmen 4,071.00 -0.59 1,287,000 American Express Co 100.23 0.32 2,763,579 Sumitomo Metal Mining Co Ltd 4,178.00 2.55 1,924,700 Caterpillar Inc 141.03 0.04 1,505,262 Orix Corp 1,826.00 1.00 4,935,100 Travelers Cos Inc/The 125.94 0.43 330,567 Daiwa Securities Group Inc 654.00 0.85 6,348,000 Softbank Group Corp 8,758.00 2.10 8,446,300 Mizuho Financial Group Inc 188.70 0.32 143,808,600 Central Japan Railway Co 21,830.00 -1.89 380,500 FTSE 100 Nitori Holdings Co Ltd 16,435.00 0.58 455,900 T&D Holdings Inc 1,618.50 1.60 3,351,400 Company Name Lt Price % Chg Volume Toyota Motor Corp 7,151.00 -0.82 7,462,200 Hoya Corp 6,183.00 0.13 1,059,100 Wpp Plc 1,228.00 1.45 2,752,141 Sumitomo Mitsui Trust Holdin 4,406.00 -0.54 1,103,500 Worldpay Group Plc 0.00 0.00 - Japan Tobacco Inc 3,003.00 -0.69 4,341,700 Wolseley Plc 0.00 0.00 - Osaka Gas Co Ltd 2,262.50 -0.66 900,500 Wm Morrison Supermarkets 256.00 0.43 8,209,649 Sumitomo Electric Industries 1,660.00 0.82 1,710,900 Whitbread Plc 4,010.00 -0.15 296,101 Traders at the Frankfurt Stock Exchange. The DAX 30 gained 0.5% to 12,609.85 points yesterday. Ono Pharmaceutical Co Ltd 2,538.00 -2.33 2,008,900 Vodafone Group Plc 189.00 -0.57 45,216,157 Ajinomoto Co Inc 2,052.50 -1.91 2,252,300 United Utilities Group Plc 735.40 -4.04 2,569,669 Mitsui Fudosan Co Ltd 2,694.00 -0.13 3,425,700 Unilever Plc 4,197.00 -0.23 2,282,452 Daikin Industries Ltd 13,015.00 1.09 834,000 Tui Ag-Di 1,695.50 0.68 829,318 Toray Industries Inc 871.60 1.09 4,731,400 Travis Perkins Plc 1,387.00 -0.79 711,400 Bridgestone Corp 4,165.00 0.68 2,830,000 Tesco Plc 254.70 -2.00 31,566,247 Sony Corp 5,705.00 0.23 7,349,100 Europe markets gain as trade Taylor Wimpey Plc 173.85 0.52 9,366,623 Astellas Pharma Inc 1,758.50 1.68 8,750,100 Standard Life Plc 0.00 0.00 - Jxtg Holdings Inc 798.10 2.99 19,858,400 Standard Chartered Plc 691.40 -0.85 4,723,423 Nippon Steel & Sumitomo Meta 2,125.00 0.57 2,707,500 St James’s Place Plc 1,181.50 -0.25 986,574 Suzuki Motor Corp 6,253.00 1.16 1,517,400 Sse Plc 1,374.50 -1.36 2,484,463 war worries take a back seat Nippon Telegraph & Telephone 5,028.00 -0.51 2,607,200 Smith & Nephew Plc 1,338.00 0.72 1,512,685 Sompo Holdings Inc 4,399.00 1.48 1,627,500 Sky Plc 1,501.50 2.25 2,871,318 Daiwa House Industry Co Ltd 3,859.00 -0.39 1,481,000 Shire Plc 4,301.00 0.16 2,152,999 for positive surprises”, growth could lenge to May, said XTB analyst David Komatsu Ltd 3,178.00 0.41 6,509,100 AFP Severn Trent Plc 1,930.00 -3.64 1,183,992 well exceed 23%, said Hussein Sayed, Cheetham. West Japan Railway Co 7,886.00 -0.59 493,300 London Schroders Plc 3,244.00 -0.73 299,015 chief market strategist at FXTM. “Should one occur, and be success- Murata Manufacturing Co Ltd 19,965.00 -0.65 2,059,000 Sainsbury (J) Plc 329.40 0.09 6,122,928 Kansai Electric Power Co Inc 1,568.50 -3.36 2,110,100 The British pound remained under ful, then there is the potential for fur- Sage Group Plc/The 625.80 1.69 2,523,879 Denso Corp 5,378.00 1.88 1,710,000 tock markets across the world pressure, but managed small gains, one ther declines in sterling,” he said. Abi Sab Group Holding Ltd 0.00 0.00 - Dai-Ichi Life Holdings Inc 1,991.50 1.43 5,047,700 rose yesterday with investors day after Brexit divisions sparked the Back in stock markets, Europe fol- Rsa Insurance Group Plc 652.20 -0.40 2,250,034 Mazda Motor Corp 1,332.00 0.30 3,055,800 feeling optimistic about the up- shock resignations of two senior min- lowed most of Asia higher after an- Royal Mail Plc 487.60 0.18 3,483,179 S Mitsui & Co Ltd 1,867.50 0.59 5,132,700 Royal Dutch Shell Plc-B Shs 2,780.50 0.89 3,866,526 coming corporate results season, espe- isters including foreign secretary Boris other strong lead from New York on Kao Corp 8,058.00 -0.48 1,437,600 Royal Dutch Shell Plc-A Shs 2,694.50 1.13 3,236,323 cially in the US, dealers said. Johnson. Monday. Sekisui House Ltd 1,923.50 0.16 2,164,400 Royal Bank Of Scotland Group 244.60 -2.28 17,215,304 Oriental Land Co Ltd 11,355.00 -0.61 584,300 The British pound stemmed its de- Both Johnson and Brexit minister Wall Street moved ahead yester- Rolls-Royce Holdings Plc 994.20 0.51 5,379,614 Secom Co Ltd 8,364.00 -0.46 513,200 cline against the dollar and euro after David Davis quit Monday in a heavy day, adding momentum to key Eu- Rio Tinto Plc 4,146.00 -0.36 2,635,439 Tokio Marine Holdings Inc 5,313.00 0.82 2,068,600 key resignations from the UK govern- blow to Prime Minister Theresa May’s ropean markets which all closed in Rexam Ltd 0.00 0.00 - Aeon Co Ltd 2,222.50 -0.65 2,243,000 the green, although London was held Relx Plc 1,651.00 -0.24 3,105,521 ment over Brexit hammered the cur- authority – and her plan for leaving the Fanuc Corp 21,735.00 1.49 1,188,100 Reckitt Benckiser Group Plc 6,358.00 -0.25 1,208,257 rency. European Union. back by the recovering pound. The Daito Trust Construct Co Ltd 18,240.00 -1.19 269,500 Randgold Resources Ltd 5,696.00 -1.42 389,147 Trade war worries also took a back The news sparked speculation of a FTSE 100 was up 0.1% at 7,692.04 Otsuka Holdings Co Ltd 4,798.00 -1.09 1,786,400 Prudential Plc 1,767.50 -1.26 3,581,765 seat as bullish sentiment prevailed. potential leadership challenge and the points, Frankfurt’s DAX 30 gained Resona Holdings Inc 593.00 0.88 8,646,600 Provident Financial Plc 627.40 4.08 629,177 Asahi Kasei Corp 1,415.50 0.46 3,240,100 “With the prospect of a positive threat of another general election. 0.5% to 12,609.85 and Paris’s CAC Persimmon Plc 2,496.00 0.85 1,151,910 Kirin Holdings Co Ltd 2,883.50 -0.84 3,088,500 earnings’ season ahead of us, inves- “Theresa May defiantly stood 40 rose 0.7% to 5,434.36 points at the Pearson Plc 908.20 1.77 4,215,645 Mitsubishi Ufj Financial Gro 636.50 1.24 72,171,900 tors seem to have forgotten the threat her ground on Monday,” said Jasper close yesterday. Paddy Power Betfair Plc 8,340.00 -0.12 164,861 Marubeni Corp 847.90 1.08 5,124,400 Old Mutual Plc 210.90 0.00 - of further trade tensions,” said Kon- Lawler, analyst at London Capital Oil prices rose, partly on expecta- Mitsubishi Chemical Holdings 948.50 1.50 6,582,700 Next Plc 5,980.00 1.29 558,330 stantinos Anthis, head of research at Group. tions of US sanctions on key producer Fast Retailing Co Ltd 48,560.00 1.70 621,900 National Grid Plc 851.80 -1.84 7,548,504 ADSS. “With threats of a vote of no confi - Iran and ongoing political and eco- Ms&Ad Insurance Group Holdin 3,407.00 -0.26 2,076,800 Mondi Plc 2,063.00 0.15 877,619 According to the FactSet data pro- dence unfounded, she lives to fi ght an- nomic turmoil in Venezuela. Kubota Corp 1,804.50 1.38 4,339,600 Merlin Entertainment 410.50 0.24 2,986,371 Seven & I Holdings Co Ltd 4,504.00 0.09 1,989,800 vider, S&P 500 company earnings are other day as prime minister... (and) the Traders were also watching Norwe- Mediclinic International Plc 531.40 -2.39 787,156 Inpex Corp 1,180.50 0.81 6,291,200 expected to grow 20% in the second pound managed to pick itself up.” gian oil production after strike action Marks & Spencer Group Plc 310.90 -0.45 6,591,300 Sumitomo Mitsui Financial Gr 4,288.00 0.66 6,177,300 quarter. But the market remains nervous on a Shell North Sea oilfi eld prompted London Stock Exchange Group 4,500.00 0.00 418,038 Ana Holdings Inc 4,006.00 0.78 1,497,300 Lloyds Banking Group Plc 62.50 -0.70 144,093,233 But when adding in “the potential of any signs of a leadership chal- the fi rst outages. Mitsubishi Electric Corp 1,476.00 2.93 8,188,600 Legal & General Group Plc 266.50 0.08 12,963,145 Honda Motor Co Ltd 3,273.00 1.02 5,328,800 Land Securities Group Plc 955.10 0.23 1,735,392 Tokyo Gas Co Ltd 2,898.50 0.05 1,477,400 Kingfisher Plc 301.50 1.04 4,951,340 HONG KONG HONG KONG Tokyo Electron Ltd 18,810.00 1.84 1,183,400 Johnson Matthey Plc 3,573.00 -0.53 549,700 Panasonic Corp 1,404.00 0.04 9,449,500 Itv Plc 180.00 0.47 10,751,132 Fujitsu Ltd 728.70 -0.53 13,817,000 Company Name Lt Price % Chg Volume Company Name Lt Price % Chg Volume Intu Properties Plc 188.10 0.45 2,504,370 East Japan Railway Co 10,205.00 -1.11 953,000 Intl Consolidated Airline-Di 677.00 -0.85 6,726,837 Aluminum Corp Of China Ltd-H 3.27 -0.61 22,241,160 Hong Kong & China Gas 15.30 0.00 12,043,451 Itochu Corp 1,995.50 0.83 3,777,100 Intertek Group Plc 5,658.00 0.53 498,155 Bank Of East Asia Ltd 32.05 0.31 797,834 Hong Kong Exchanges & Clear 234.00 0.43 5,017,550 Fujifilm Holdings Corp 4,356.00 1.49 1,830,900 Intercontinental Hotels Grou 4,764.00 0.53 360,709 Bank Of China Ltd-H 3.71 0.54 327,048,051 Hsbc Holdings Plc 73.90 0.75 17,316,974 Yamato Holdings Co Ltd 2,980.00 -1.19 1,901,600 Inmarsat Plc 527.60 1.77 4,631,542 Bank Of Communications Co-H 5.61 1.08 28,468,453 Hutchison Whampoa Ltd 0.00 0.00 - Chubu Electric Power Co Inc 1,677.00 -2.81 1,993,700 Informa Plc 848.60 1.12 3,011,005 Belle International Holdings 0.00 0.00 - Ind & Comm Bk Of China-H 5.65 0.71 283,708,159 Mitsubishi Estate Co Ltd 1,911.00 -0.91 3,127,200 Imperial Brands Plc 2,905.00 -0.38 1,348,588 Boc Hong Kong Holdings Ltd 36.95 0.96 16,826,364 Li & Fung Ltd 2.59 -1.15 36,484,313 Mitsubishi Heavy Industries 4,069.00 0.42 1,221,300 Hsbc Holdings Plc 707.00 -0.79 22,629,669 Cathay Pacific Airways 12.30 0.49 1,323,100 Mtr Corp 43.20 0.47 1,785,072 Shiseido Co Ltd 8,325.00 0.86 2,153,400 Hargreaves Lansdown Plc 2,070.00 2.83 948,784 Ck Hutchison Holdings Ltd 85.30 0.47 5,213,465 New World Development 11.12 -0.18 11,297,692 Shionogi & Co Ltd 5,605.00 0.14 1,045,400 Hammerson Plc 541.80 -0.70 5,301,348 China Coal Energy Co-H 3.04 -2.56 13,681,936 Petrochina Co Ltd-H 5.86 2.27 129,360,357 Recruit Holdings Co Ltd 3,093.00 1.41 3,760,700 Glencore Plc 326.95 -2.48 40,642,610 China Construction Bank-H 6.99 0.72 277,025,147 Ping An Insurance Group Co-H 71.10 0.21 32,881,238 Japan Airlines Co Ltd 3,900.00 0.49 1,332,100 Glaxosmithkline Plc 1,563.60 0.71 6,306,173 China Life Insurance Co-H 19.88 1.12 36,253,071 Power Assets Holdings Ltd 57.80 0.26 2,922,244 Nitto Denko Corp 8,086.00 -0.11 1,051,400 Gkn Plc 0.00 0.00 - China Merchants Port Holding 16.04 0.88 2,846,803 Sino Land Co 12.74 0.31 2,349,713 Kddi Corp 3,105.00 -0.26 4,403,000 Fresnillo Plc 1,134.50 -0.79 572,573 China Mobile Ltd 70.85 0.21 13,235,892 Sun Hung Kai Properties 120.00 -0.41 2,277,444 Rakuten Inc 797.20 4.89 25,112,300 Experian Plc 1,922.00 0.79 2,488,330 China Overseas Land & Invest 25.55 0.79 11,351,209 Swire Pacific Ltd - Cl A 86.15 0.12 964,873 Kyocera Corp 6,258.00 1.79 1,448,600 Easyjet Plc 1,611.00 -1.17 1,727,126 China Petroleum & Chemical-H 7.09 0.85 63,100,462 Tencent Holdings Ltd 386.80 -2.32 26,791,391 Nissan Motor Co Ltd 1,041.50 3.79 25,303,100 Dixons Carphone Plc 189.40 0.19 2,041,264 China Resources Beer Holding 35.55 -0.56 4,400,818 Wharf Holdings Ltd 26.10 0.58 5,970,776 Direct Line Insurance Group 335.30 0.18 3,910,736 China Resources Land Ltd 26.35 1.15 10,725,970 China Resources Power Holdin 14.54 0.41 6,032,598 Diageo Plc 2,767.50 0.86 2,510,622 SENSEX Dcc Plc 6,905.00 0.22 151,004 China Shenhua Energy Co-H 18.06 -0.99 26,749,310 GCC INDICES Crh Plc 2,707.00 -0.22 1,074,463 China Unicom Hong Kong Ltd 9.60 0.10 23,048,973 Compass Group Plc 1,599.00 0.63 2,532,364 Company Name Lt Price % Chg Volume Citic Ltd 10.66 -0.56 8,214,416 Indices Lt Price Change Coca-Cola Hbc Ag-Di 2,678.00 2.88 890,879 Clp Holdings Ltd 87.50 -0.57 3,529,750 Doha Securities Market Zee Entertainment Enterprise 538.40 -0.41 1,338,133 9,395.81 +130.81 Centrica Plc 163.05 -0.37 17,711,084 Cnooc Ltd 13.04 2.52 58,280,414 Saudi Tadawul Yes Bank Ltd 371.40 2.23 21,268,663 8,417.91 +91.32 Carnival Plc 4,320.00 0.70 1,078,053 Cosco Shipping Ports Ltd 6.71 -1.18 901,109 Kuwait Stocks Exchange Wipro Ltd 270.60 2.13 5,075,343 #N/A N/A #N/A N/A Capita Plc 159.40 -1.70 3,046,574 Esprit Holdings Ltd 2.26 1.35 3,637,103 Bahrain Stock Exchage Vedanta Ltd 226.05 -0.24 8,970,755 1,334.80 +0.37 Burberry Group Plc 2,101.00 1.45 2,064,061 Fih Mobile Ltd 1.12 -1.75 6,314,011 Oman Stock Market Ultratech Cement Ltd 3,959.80 1.55 194,715 4,498.34 -18.93 Bunzl Plc 2,292.00 -0.04 699,140 Hang Lung Properties Ltd 16.10 0.63 2,506,210 Abudhabi Stock Market Tech Mahindra Ltd 650.75 1.07 3,684,702 4,668.55 +51.59 Bt Group Plc 227.35 -2.15 22,617,747 Hang Seng Bank Ltd 199.20 1.01 1,286,853 Dubai Financial Market Tata Steel Ltd 568.65 2.35 10,724,395 2,895.64 +20.32 British Land Co Plc 660.00 -0.36 2,392,265 Henderson Land Development 42.05 0.48 2,455,063 Tata Power Co Ltd 73.05 -0.20 2,760,905 British American Tobacco Plc 3,931.50 -0.71 2,345,199 Tata Motors Ltd 275.45 0.71 6,815,055 Bp Plc 589.50 0.84 27,169,900 Tata Consultancy Svcs Ltd 1,875.10 -0.42 5,736,482 Bhp Billiton Plc 1,707.60 -0.04 4,760,607 Sun Pharmaceutical Indus 563.95 -0.85 5,191,067 Berkeley Group Holdings/The 3,573.00 -0.14 485,072 “Information contained herein is believed to be reliable and had been obtained from sources believed to be reliable. The State Bank Of India 263.75 0.84 12,033,026 Barratt Developments Plc 483.00 -0.23 6,142,519 Reliance Industries Ltd 1,025.70 2.87 11,055,439 accuracy and completeness cannot be guaranteed. This publication is for providing information only and is not intended Barclays Plc 186.48 -1.01 26,805,345 Punjab National Bank 77.85 0.06 14,753,678 as an off er or solicitation for a purchase or sale of any of the financial instruments mentioned. Gulf Times and Doha Bank Bae Systems Plc 648.20 0.50 4,486,391 Power Grid Corp Of India Ltd 184.05 -0.24 4,138,921 or any of their employees shall not be held accountable and will not accept any losses or liabilities for actions based on Babcock Intl Group Plc 778.40 -0.21 1,643,759 Oil & Natural Gas Corp Ltd 157.95 0.35 5,504,925 this data.” Aviva Plc 498.00 -0.12 12,986,167 Ntpc Ltd 153.90 1.75 3,321,607 Astrazeneca Plc 5,281.00 0.49 1,373,784 Maruti Suzuki India Ltd 9,531.00 1.67 559,093 Associated British Foods Plc 2,510.00 -0.04 1,030,190 Mahindra & Mahindra Ltd 930.55 -0.24 1,701,703 Ashtead Group Plc 2,337.00 1.13 1,923,918 Lupin Ltd 902.85 -0.95 2,079,472 CURRENCIES Arm Holdings Plc 0.00 0.00 - Larsen & Toubro Ltd 1,284.60 -0.26 2,030,973 DOLLAR QATAR RIYAL SAUDI RIYAL UAE DIRHAMS BAHRAINI KUWAITI Antofagasta Plc 969.40 -0.68 2,410,549 DINAR DINAR Kotak Mahindra Bank Ltd 1,372.15 -0.93 1,517,724 Anglo American Plc 1,723.00 -0.84 3,052,461 Itc Ltd 277.05 0.97 11,914,361 Admiral Group Plc 1,898.50 0.93 473,704 Infosys Ltd 1,301.40 0.20 3,124,023 3I Group Plc 917.20 0.20 1,665,737 Indusind Bank Ltd 1,935.10 -1.18 3,415,912 #N/A 0.00 0.00 - Idea Cellular Ltd 55.80 2.20 18,727,729 Icici Bank Ltd 273.40 0.81 16,138,539 TOKYO Housing Development Finance 1,942.55 1.98 1,893,150 Hindustan Unilever Ltd 1,687.00 -0.29 1,131,289 Hindalco Industries Ltd 229.05 3.15 11,991,288 Company Name Lt Price % Chg Volume Hero Motocorp Ltd 3,583.50 -0.78 499,228 Hitachi Ltd 790.20 2.38 16,017,000 Hdfc Bank Limited 2,146.40 0.98 2,784,906 Takeda Pharmaceutical Co Ltd 4,630.00 0.00 3,512,500 Hcl Technologies Ltd 979.55 1.87 5,745,924 Jfe Holdings Inc 2,092.00 1.58 3,232,200 Grasim Industries Ltd 990.65 0.67 849,393 Sumitomo Corp 1,841.00 0.96 3,805,100 Gail India Ltd 363.95 4.76 7,462,799 Canon Inc 3,543.00 0.74 4,003,300 Dr. Reddy’s Laboratories 2,321.85 -0.35 721,320 Nintendo Co Ltd 35,510.00 -0.25 1,522,800 Coal India Ltd 278.45 2.69 3,158,848 Eisai Co Ltd 10,550.00 -1.49 7,501,900 Cipla Ltd 632.05 1.47 1,937,744 Isuzu Motors Ltd 1,422.50 1.64 2,024,400 Cairn India Ltd 0.00 0.00 - Unicharm Corp 3,362.00 -0.94 1,115,400 Bosch Ltd 17,842.05 -1.09 22,630 Shin-Etsu Chemical Co Ltd 10,385.00 1.32 1,161,900 Bharti Airtel Ltd 367.80 1.57 1,782,107 Smc Corp 38,710.00 2.27 182,300 Bharat Petroleum Corp Ltd 375.25 -0.28 1,759,003 Mitsubishi Corp 3,132.00 -0.03 3,703,800 Bharat Heavy Electricals 71.55 2.07 4,983,226 Asahi Group Holdings Ltd 5,505.00 -2.20 1,135,900 Bank Of Baroda 119.50 2.14 12,065,057 Keyence Corp 60,990.00 2.97 381,900 Bajaj Auto Ltd 3,093.95 2.51 1,096,387 Nidec Corp 16,720.00 1.39 780,800 Axis Bank Ltd 532.55 1.39 5,685,892 Nomura Holdings Inc 541.00 0.84 13,621,100 Asian Paints Ltd 1,370.45 0.54 856,181 Daiichi Sankyo Co Ltd 4,369.00 0.39 2,048,700 Ambuja Cements Ltd 204.35 -0.87 3,850,699 Subaru Corp 3,168.00 -0.91 6,740,900 Adani Ports And Special Econ 370.45 0.95 1,796,868 Ntt Docomo Inc 2,812.00 -1.06 4,047,000 Acc Ltd 1,371.00 -0.35 530,484 Gulf Times Wednesday, July 11, 2018 13 BUSINESS

Westpac’s yen bond just fi ne for some buyers Foreign funds keep pouring into

Bloomberg Tokyo China despite yuan’s jitters estpac Banking Corp’s fi ve-year samurai Bloomberg Wbond was a hit with Hong Kong smaller Japanese fi nancial in- stitutions attracted by its yield premium, even as some bigger he sharpest decline of China’s buyers passed up the chance to yuan since a turbulent devalu- take part in the deal last week. Tation in 2015 hasn’t fazed inter- The Australian bank sold national bond funds, suggesting their ¥76.3bn ($691mn) of 0.32% diversifi cation fl ows will be a useful yen notes at a spread of 17 ba- stabilising force for the nation’s policy sis points over yen swaps, in its makers. fi rst foray in the Samurai market “The falling yuan is a concern, but since January 2016. The bonds as long as it’s not in a severe down- priced at the wide end of offi cial trend, it’s not the biggest consideration guidance, and that was enough when we’re investing in local-currency to prompt buying by smaller bonds in China,” said Manu George, di- Japanese investors, who liked rector of fi xed income at Schroder In- the high debt ratings and addi- vestment Management in Singapore, in tional yield premium over do- a view echoed by other market partici- mestic corporate notes. pants. More than half of the bond’s June saw the yuan’s biggest monthly buyers were regional banks and drop against the dollar since 1994, yet smaller credit institutions, ac- overseas investors poured the most cording to a person familiar into China’s domestic bonds in almost with the off ering, who isn’t au- two years. The contrast is a testament thorised to speak publicly and to foreign demand for exposure to asked not to be identifi ed. With the country’s $12tn bond market, the a sharp rise in borrowing costs in world’s third-largest. the US this year, issuance in Ja- China has steadily opened to inter- pan’s Samurai market is proving national investors in part to provide a attractive for foreign issuers – balance against domestic pressures to sales in the three months to the ferret money out. end of June climbed to the most The sustained infl ows are also im- in four years. portant for China’s borrowing costs, An AA-rating and a relatively because overseas investors have re- short bond tenor meant that the placed domestic banks as the domi- Sydney-based lender’s bond was nant marginal player in the government attractive compared with some bond market this year. lower-rated Japanese issuers Their purchases have helped lower who have been selling at under the yield on China’s 10-year notes by 10 basis points, according to one the most in Asia – and among emerging domestic investor at a regional markets more broadly. bank. Another regional investors While the yuan’s slide from mid- “Allowing yuan depreciation is part since it won offi cial reserve-currency mand for the yuan. Inclusion in in- es, he said. Hedging is also important, who bought some of Westpac’s June stoked speculation China’s lead- of a directed policy of easing,” said status from the IMF in 2015. ternational bond indexes is another and increasingly available. Turnover debt noted that it was a senior ership was turning to depreciation as Pierre-Yves Bareau, chief investment Not all has been so rosy for China’s objective offi cials continue to work on, of futures tied to the off shore yuan bond with a high credit score at a weapon against US President Donald offi cer for emerging-market debt at assets. Foreigners initially jumped into a move that could prompt further di- against the dollar at Hong Kong Ex- a time when riskier hybrid notes Trump’s protectionist trade moves, the JPMorgan Chase & Co’s asset manage- domestic stocks newly available in versifi cation infl ows. changes & Clearing surged to a record are lengthening in maturity. country’s monetary authorities have ment unit in London. “We don’t think MSCI Inc’s international indexes from At 1.36tn yuan, foreign holdings of on July 3, driving the notional value to A spokesman at Westpac pledged a stable currency. It was little this has parallels to the drop in 2015. the start of last month, but infl ows have China’s bonds are still relatively lim- $2.2bn, data from the bourse showed. wasn’t immediately able to changed at 6.6148 per dollar in Shang- Policy makers are fully in control and tailed off in the past three weeks as the ited, People’s Bank of China data show. The onshore yuan slid through 6.7 that comment on the deal. hai, after jumping the most since Janu- anchoring the situation.” yuan slid. That amounts to little more than the day, spurring offi cials to off er their re- Spreads on foreign issuer yen ary on Monday. Ji Tianhe, a China strategist at BNP Net purchases via the stock con- equivalent of what Hong Kong holds in assurance. notes have also edged up since Rather than getting spooked as in Paribas SA, went so far as to expect nect with Hong Kong amounted to US Treasuries alone. Among the comments, Guo Shu- the end of May, increasing the 2015, when China was battling against that “some investors would deem the 3.2bn yuan ($484mn) in the three “Improving market infrastructure qing, who heads the banking regulator allure for local buyers. fears of an economic hard landing, depreciation a buying opportunity, as weeks through July 6, compared and solving technical issues play a and serves as Communist Party chief at market players this time around see the slide creates room for future ap- with 48.5bn yuan the prior three larger role when asset managers de- the central bank, said the yuan should a weaker yuan as part of a support- preciation.” weeks, according to data compiled cide whether to invest in China” than strengthen in time. MSCI’s benchmark ive monetary stance that should prove Central banks have probably also by Bloomberg. the yuan, said Johnny Chen, a portfo- That’s the bet of Andy Seaman, good for bonds. been key to the infl ows, said Becky Liu, The CSI 300 Index has slumped 7.8% lio manager for Asian local-currency chief investment offi cer at Stratton emerging equities And with the trade battle threatening the Hong Kong-based head of China since June 15, in yuan terms. bonds at NN Investment Partners Ltd Street Capital LLP. Stratton recently index dip 0.1% to curb growth, Chinese policy makers macro strategy at Standard Chartered In wake of the 2015-16 capital-fl ight in Singapore. increased its exposure to the yuan, an- also have cause to go easy on fi nancial Plc. She noted that offi cial demand scare, Chinese authorities have been That includes the capability for block ticipating that rising productivity will The MSCI’s benchmark emerg- deleveraging, which has hammered the takes more of a long-term view. The increasingly encouraging foreign- in- trading, delivery versus payment set- help keep China’s current-account ing equities index dipped just corporate debt market. yuan has been rising in allocations vestment infl ows to help balance de- tlement and more clarifi cation on tax- surplus intact for the long haul. 0.1% in the absence of further developments in the trade dis- pute between the United States and its key trading partners. Turkish stocks tumbled 2.3%, their worst one-day loss China bulls keep faith in soaring earnings after stock rout in a month, while bank shares plunged almost 4% and sover- eign dollar bonds fell as much Bloomberg compiled by Bloomberg. That would ties. The next catalyst will be evidence tougher regulation. Analysts have lifted nese stocks about 25% cheaper than in as 4.6 cents. Hong Kong be their best earnings growth in eight that corporates are still fi ne.” their earnings-per-share estimates for January. They also trade at a 5.5% dis- The lira firmed 0.1% against years. This evidence of China Inc’s re- Goldman Sachs strategists say China Ping An Insurance (Group) Co, the big- count to the MSCI Emerging Markets the dollar after plunging more silience may off er relief to investors af- will deliver the best earnings growth gest stock on the CSI 300, to an all-time Index, near the widest since 2014. than 3% on Monday. hinese equities are now so cheap ter a selloff turned the country’s stocks among countries in their Asia Pacifi c high. Not everyone is convinced that The low valuations attracted some Chinese shares edged up that even the Shanghai Stock into the world’s worst performers. ex-Japan coverage this year, helped by earnings will be so good in China, or that dip buyers back into the equity market another 0.2% after Monday’s CExchange feels compelled to say Tightening credit conditions and a a rebound in the energy and materials a stronger fundamental backdrop will on Monday, when the CSI 300 rose 2.8% 2.8% rally, their biggest one-day something about them. trade dispute with the US pose risks to companies that together make up about lift the country’s equities. for its best daily rally since August 2016. jump since August 2016. The Optimism over corporate health per- an economy that’s already set to expand a 10th of the CSI 300. Morgan Stanley strategists cut their It added 0.2% Tuesday, its fi rst three- gains came in the wake of plans sists despite a rout that shaved more at the slowest pace since 1990. While commodities took a beating in forecasts last month, predicting only day winning streak in two months. to ease restrictions on foreign than $2tn off the value of Chinese eq- “Restoring confi dence may take June, their average price in the second about 9% profi t growth for CSI 300 “You have stocks that are trading be- investment in the Shanghai and uities since a peak in January, taking time, but we’d argue that robust fun- quarter was still 7.2% higher than the members in 2018, down from a previ- low their intrinsic value,” said Eleanor Shenzhen stock markets. valuations to two-year lows. damentals will provide some support, same period last year, according to a ous estimate of 12%. They also forecast Creagh, a Sydney-based market strat- But China’s yuan dipped Analysts predict companies on the especially given where valuations are,” Bloomberg index. the index is unlikely to recover from a egist for Saxo Capital Markets. That 0.2% after data showed June CSI 300 Index, which mostly sell in said Kinger Lau, Goldman Sachs Group China’s largest insurers have also bear market in the next year. means there are opportunities in some producer inflation accelerated China and are less aff ected by a weak- Inc’s chief China strategist in Hong helped bolster prospects for profi t With the second-quarter reporting sectors like consumer and tech, though to a six-month high. er yuan, will increase profi ts by 16% Kong. “People will ultimately turn a growth, amid signs their shift into long- season about to kick off , expectations “investors have to be cautious at the on average in 2018, according to data little more constructive on China equi- er-term products is paying off despite that earnings will jump have made Chi- moment,” she said. Sensex gains 304 points; rupee weakens Asia markets rise as trade woes give way to earnings hopes Bloomberg, Reuters dustrial production data due to be Mumbai released tomorrow. June CPI prob- ably rose 5.25% year on year versus AFP yen, helping Tokyo’s Nikkei end 0.7% higher. 4.87% in May, according to me- Hong Kong Shanghai added 0.4% and Singapore 1%. he BSE Sensex reclaimed dian in a Bloomberg News survey. Seoul gained 0.4%, Taipei edged 0.3% higher, the 36,000-mark and the Bond yields gained for second while Manila and Jakarta were also well up. TNSE’s Nifty 50 rose past sessions due to heavy supply week. Asian markets mostly rose yesterday following Hong Kong pared early gains to end flat after a 10,900 yesterday led by gains in The 10-year bond yield stood at another strong lead from New York, as optimism two-day advance. Reliance Industries, and ahead of 7.9%, from its Monday’s close of about the US economy and the beginning of the Rodrigo Catril, senior strategist at National key quarterly results scheduled 7.890%. earnings season provide a distraction from trade Australia Bank, said: “No new news from the US- later in the day. Shares rose for a Bond yields and prices move in tensions. Sino trade war has helped investors focus back on third straight session and posted opposite directions. After weeks of losses across the world, inves- fundamentals and with the US earnings season their highest close in more than So far this year, the rupee has tors moved back in on Friday as the tit-for-tat tar- starting later this week, the US has led the gains in fi ve months. weakened 7.1%, while foreign in- iff s between Beijing and Washington had already equities overnight.” Meanwhile, local investors vestors have sold $719.90mn and been factored in and attention shifted to US jobs The reporting season for April-June kicks off bought shares worth a net of $6.19bn in equity and debt mar- and corporate results. in the US this week and there are hopes another Rs740.39 crore, while foreign in- kets respectively. Wall Street’s three main indexes closed with outstanding set of reports can put some fizz back vestors sold shares worth a net of Most Asian currencies fell as more healthy gains Monday, building on a rally into world markets. Rs569.91 crore on Monday, provi- the dollar strengthened and re- that has been given life by another forecast-bust- Also on the radar this week is the release of sional data showed. gional stocks pared gains. Japanese ing US jobs report. Chinese trade data, which will be pored over for The BSE Sensex closed higher yen was down 0.45%, Thai Baht “For a change, all is quiet on the...trade war an idea about what impact the ongoing row with by 304.90 points, or 0.85%, to 0.39%, South Korean won 0.38%, front as the drop in aggressive US tariff posturing the US has had so far on the world’s number two 36,239.62, while the Nifty 50 rose The rupee closed at 68.82 a dollar yesterday, down 0.15% from China Off shore 0.34%, China ren- and the (jobs data) after eff ects have propelled economy. 94.35 points, or 0.87%, to close at its previous close of 68.72 minbi 0.34%, Indonesian rupiah US equity markets to their third consecutive day While the pro-Brexit minister had been seen as 10,947.25. 0.26%, Philippines peso 0.24%, of substantial gains,” said Stephen Innes, head of a thorn in Prime Minister Theresa May’s side, ob- The BSE MidCap and SmallCap Yes Bank and Coal India were Asian currencies. The rupee ended Taiwan dollar 0.15%, Singapore Asia-Pacific trading at OANDA. servers said the news increases the chances she gained 1.01% and 1.04%, respec- other top gainers. HPCL, IndusInd at 68.82 a dollar, down 0.15% from dollar 0.1%. “For the time being robust US economic data is will face a possible leadership challenge, throwing tively. All the sectoral indices on Bank, Kotak Bank and Sun Pharma its previous close of 68.72. However, Malaysian ringgit was off setting concerns about rising trade tensions.” Britain into fresh turmoil and the possibility of the BSE ended higher with energy were among the major losers. TCS The currency opened at 68.72 up 0.15%. However, he added a word of warning that another general election. rising most at 2.01% followed by shares closed 0.56% lower ahead a dollar and touched a high and a The dollar index, which meas- “markets remain deceptively tricky and could be In Tokyo, the Nikkei 225 closed up 0.7% to realty 1.79%, telecom 1.75% and of its Q1 earnings. low of 68.72 and 68.86, respec- ures the US currency’s strength even more so as we enter the US dog days of sum- 22,196.89 points; Hong Kong — Hang Seng ended metal 1.58%. Meanwhile the rupee yesterday tively. against major currencies, was mer”. The positive sentiment and US economic op- flat at 28,682.25 points and Shanghai — Composite Reliance Industries led the gains closed marginally weaker against Traders are awaiting consumer trading at 94.442, up 0.01% from timism has lifted the dollar against the safe haven rose 0.4% to 2,827.63 points yesterday. by rising 3.02%. Gail, Hindalco, the US dollar, tracking losses in price infl ation and Index of In- its previous close of 94.077. Gulf Times 14 Wednesday, July 11, 2018 BUSINESS

Air France-KLM CEO hunt signals strategy shift under Macron

Reuters for KLM, one of the sources said. It is of a national asset in foreign hands. the unenviable task of having to break reputation as a reformist and mod- istry offi cial said. AccorHotels’ over- Paris just one option on the table. “What we want to do is to create Eu- union resistance to reduce Air France’s erniser. “Restructuring...is what is seas investors could, however, com- Macron’s offi ce expects to receive ropean champions,” a fi nance ministry swollen cost base, while keeping in- required to move Air France-KLM plicate any deal. Its main investors are a shortlist of candidates from the offi cial said, speaking on condition of creasingly frustrated Dutch KLM staff forward. Anything else will be history from China and the Gulf, whose own he hunt for a new chief executive group’s interim management by the anonymity.”It’s not of primary impor- onside. repeating itself,” said Bernstein analyst airlines compete with Air France-KLM to lead Air France-KLM, a group end of next week, a third source famil- tance that the boss has to be French.” A wave of strikes this spring at Air Daniel Roeska. on long-haul routes. Thobbled by union resistance to iar with the matter said. “It wouldn’t worry us if we ended France over pay cost the group some Macron could go further and sell- European Union rules also require cost-cutting at its French brand, is The Air France-KLM group has been up with an aviation specialist from €350mn ($410.97mn) and led to the down France’s 14.3% stake in Air more than half of a European airline’s testing President Emmanuel Macron’s led by French chief executives since its Europe.” Delta Air Lines and China ouster of Janaillac. France-KLM, a move that would deliv- capital to be held by member states or resolve for a lighter state touch on the formation in 2004, a demand of the Eastern Airlines, which both hold 8.8% Sources say KLM offi cials are frus- er a potent message that he is serious EU nationals. economy. French state, its largest shareholder stakes in Air France-KLM, declined to trated at French staff ’s chronic labour about liberalising the economy. “Accor’s capital today is not suffi - Macron’s government has told the and one with heavy infl uence over the comment. confl icts and blame Air France’s weak The state’s exit from the airline ciently European for it to work,” said Franco-Dutch airline group its very group’s board thanks to its outsized Two names have leaked to media in handling of the powerful SNPL pilots’ group would hand its leadership more a second source familiar with the dis- survival is at stake if it fails to become voting rights. past weeks. union for the group’s fragile state. In- freedom to stare down the unions. cussions. more competitive and undergo the The last, Jean-Marc Janaillac, re- Philippe Capron, the fi nancial head vestors are frustrated too. “(IAG chief executive) Willie Walsh There would, however, be ways to painful reforms completed by carriers signed in May after losing a fi ght over of Veolia Environnement, pulled out The group’s share price has slumped just stared them down until blood overcome this, analysts say. such as British Airways and Lufthansa pay with Air France staff . after French ministers said they want- 47% so far this year. Asked recently came out of their eyes and they gave The state’s holding remains an open as they battle low-cost airlines and His role as group chief executive and ed an aviation specialist and that he if the group could have a Dutch chief up,” said aviation consultant Andrew question. Gulf carriers. chairman as well as chairman of the Air was one of several candidates. executive, KLM CEO Pieter Elbers re- Charlton. Nonetheless, analysts are encour- In what would signal a subtle shift in France unit has prompted a rethink of Le Figaro reported on Monday that sponded: “why not?” AccorHotels announced last month aged by broader comments on the fu- French industrial strategy, two sources the structure. Catherine Guillouard, chief executive The pressure from investors to slash it was looking at buying all or part of ture of Air France-KLM coming out of familiar with Macron’s thinking said Paris’ readiness to consider a for- of French public transport group RATP, costs has intensifi ed as rising fuel costs the French state’s stake — an option the French fi nance ministry. the government is open to considering eigner to oversee a revamp of the air- was being considered for the top job at and overcapacity squeeze margins. the government has not closed the “The noises heard out of the fi- a non-French national as chairman of line’s strategy and negotiations with Air France-KLM. Two sources told Re- Finance Minister Bruno Le Maire door on but which faces obstacles. nance ministry definitely signify the group for the fi rst time. This chair- Air France unions refl ects Macron’s uters she was not an offi cial candidate. warned after Janaillac quit that he “The government is studying things a change in attitude towards Air man would sit above one chief execu- desire to create pan-European com- The job of Air France-KLM chief ex- would not soak up the airline’s losses. and is closed to nothing, but the fi rst France-KLM from the French state, tive for Air France, who would almost panies that can withstand globalisa- ecutive may not be one that widely ap- Overseeing a restructuring of Air priority is to fi nd a new leadership team said Roeska.” And they fit with Ma- certainly be a French national, and one tion, even if that means placing control peals. The next company chief will face France-KLM would cement Macron’s for Air France-KLM,” the fi nance min- cron’s wider strategy.” Italy’s government bond yields rise UK economic growth

Reuters that there are people in the gov- London ernment with these views and that the Italian government is on a path of confrontation with the talian government bond European Union.” rebounds; consumer yields rose yesterday, revers- Italian 10-year bond yields, Iing earlier falls after com- which had traded lower for ments on Italy’s membership of much of the day, were up 1.5 ba- the single currency by a euro- sis points, while fi ve-year bond sceptic member of the govern- yields were 2 bps higher at 1.81%. ment. The closely-watched gap be- European Aff airs Minister tween benchmark 10-year Ital- Paolo Savona said Italy needed ian and German government spending jumps to be ready for “all eventualities” bond yields briefl y widened to regarding its membership of the 240 bps before falling back to Bloomberg eurozone, which might depend around 236 bps. London on factors outside its control. Most other eurozone bond Savona was originally picked yields edged higher as the fi rst as economy minister by the an- wave of this week’s hefty bond he UK economy is bouncing back ti-establishment coalition that supply hit the market. from a near standstill in the fi rst took offi ce last month, but the Germany and Netherlands Tquarter and a summer boost to choice was vetoed by the head of sold a combined amount of consumer spending is supporting the state because of his critical views nearly €3bn ($3.5bn) of bonds pickup. about the euro. yesterday, with Irish and Italian Gross domestic product increased In a sign of how sensitive auctions to follow later in the 0.2% in the three months through May, markets have become to Italian week.“There is a lot of duration- the Offi ce for National Statistics said in political developments, bond heavy supply this week with the its fi rst publication of rolling monthly yields rose and Milan’s blue- overall market sentiment for risk growth fi gures. In May alone, output chip share index erased earlier supportive as the markets digest gained 0.3%, while a report from Bar- gains after the remarks. them,” said Orlando Green, a claycard showed household spending “He is a well-known euro- fi xed income strategist at Credit rose at the fastest annual pace in more sceptic and he seems to be being Agricole in London. than a year in June. deliberately provocative,” said Gilt yields surged after data The fi gures support Bank of England Chris Scicluna, head of eco- showed that UK economic governor Mark Carney’s argument that nomic research at Daiwa Capital growth had picked up momen- the slump at the beginning of the year Markets in London. tum on a monthly basis, boost- was temporary and weather related. Pol- “To the extent that we knew ing expectations of a Bank of icy makers are considering whether to his views already, the latest England interest rate increase in raise interest rates as early as next month comment provides a reminder August. if evidence suggests the UK expansion is fast enough to stoke domestic infl ation Italy banks’ deposits growth accelerated in May pressures. While the economy is stabilising, the Deposits at Italian banks rose new government has shifted big uncertainty for the outlook remains 5.7% in May on an annual basis, towards promoting growth and politics. Prime Minister Theresa May accelerating from a 4.3% rise in away from debating membership this week lost two senior ministers in the April, Bank of Italy data showed, of the euro, calming financial space of a day, and is under pressure from soothing concerns over an markets. “Deposits data published pro-Brexit lawmakers in her Conserva- outflow of money from lenders’ today are even better than my tive Party. As the government fi ghts over accounts due to political tensions. expectations,” said Raff aella how to leave the European Union, busi- In May, the leak of a draft Tenconi, chief economist at inde- nesses are furious over the lack of clarity programme for a new populist pendent research firm Ada. and investment decisions are at risk. government sparked a sell-off “I don’t see any negative The change in format for the GDP re- of Italy’s government bonds and impact on deposits in this phase lease means that the BoE won’t have a shares. since the approval rating of full second-quarter estimate of growth Some analysts said in recent citizens for the government has when it meets next month. Carney has weeks the deposits data was risen...the majority of Italians are nevertheless said that the rate- setting key to establishing whether the not worried,” Tenconi said. panel will have enough information to confidence crisis that prompted The popularity of the coalition make a decision. investors to dump banking stocks government has increased since Tuesday’s report suggests growth will had also aff ected depositors. it took off ice in early June, with accelerate in the second quarter from the Economists say, however, its two main parties surging in fi rst, when it slowed to a meagre 0.2%. that the popularity of the new opinion polls to about 30% of Services would have to fall 1.7% in June to government among Italians has public support. have a neutral impact on the period, and from the data imply the Bank of England Barclaycard said Tuesday that spending a weaker-than-expected 0.4%. Overall increased since the formation of The data could also signal construction would have to decline 1.5%. will raise interest rates in August,” ac- jumped 5.1% in June from a year earlier. industrial production unexpectedly fell, the 5-Star Movement and League a change in the attitude of “Growth is on course to rebound in the cording to Dan Hanson and Jamie Murray Construction output surged 2.9% in hurt by a shutdown at the Sullom Voe oil coalition, limiting the prospect of Italians about investments, Lea second quarter after a weak fi rst quarter. of Bloomberg Economics. May, the most in more than two years, and gas terminal in the North Sea. an outflow of deposits. Zicchino, partner at consultant Assuming Prime Minister Theresa May Recent evidence suggests that England’s extending a rebound from a snow- Separate fi gures showed the trade In addition, the focus of the firm Prometeia said. and her government manage to survive success in the World Cup soccer tourna- blighted fi rst quarter, the statistics offi ce defi cit in goods was little changed at the prevailing political storm, all signs ment is boosting UK consumer activity. said. Manufacturing production gained £12.4bn. The overall trade gap narrowed. Hedge funds target WTI, leaving other oil contracts becalmed

By John Kemp US gasoline (+4mn) and US heating oil 2015, with managers holding a net London (+2mn). long position of 457mn barrels in both Net length in European gasoil was benchmarks. cut by 3mn barrels, according Portfolio managers hold the most Hedge fund managers have to an analysis of regulatory and lopsided position in WTI since June continued to boost their bullish exchange data WTI position-building 2014, when fighters were racing across exposure to US crude futures and is being driven by the draw down northern Iraq and threatening the options, following a longer-than- in inventories around Cushing and country’s oilfields. expected disruption of pipeline disruption of pipeline deliveries to Hedge fund long positions outnumber deliveries from Canada. the US Midwest as a result of the short positions in WTI by a ratio of Position-building in US crude, also stoppage in production at Canada’s almost 13:1, up from less than 6:1 two known as WTI, accounted for almost all Syncrude plant. weeks ago. changes in the petroleum complex in But the rest of the petroleum complex, But away from WTI, there were no the week to July 3. including the international benchmark significant position changes. Hedge funds and other money Brent, has shown no significant changes The fund community is running a managers raised their net long position in recent weeks. substantial net long position across the in the six most important petroleum Funds’ net long position in WTI has petroleum complex, though it has been futures and options contracts by 47mn surged by 116mn barrels in the two trimmed by light profit-taking since barrels. most recent weeks, while net length in mid-April. Portfolio managers raised net their long Brent has been unchanged. position in US crude (+41mn barrels) Net length in WTI has closed the gap „ John Kemp is a Reuters market analyst. with minor increases in Brent (+4mn), with Brent for the first time since June The views expressed are his own. Gulf Times Wednesday, July 11, 2018 15 BUSINESS

Global debt load at a record $247tn in Q1, says IIF report

Reuters fi nancial sectors could be prob- New York lematic, although unlikely to become a debt crisis akin to a decade ago, IIF executive man- he amount of debt held by aging director Hung Tran told both mature and emerg- reporters ahead the data release. Ting markets tracked by “Non-fi nancial borrowers the Institute of International in the corporate sector, in the Finance rose to a record $247tn household sector, in the govern- in the fi rst quarter of 2018, up ment sector having very high 11.1% from the same period a debt levels, will fi nd it very cost- year ago. ly and diffi cult to refi nance and The report released yesterday borrow more in order to sustain by the IIF, a global bank lobby- investment and consumption ing group, said the ratio of debt going forward. to gross domestic product of That is really causing growth these nations, which include to falter, so what I term head- the Group of Seven industrial- winds to growth,” Tran said. ised nations and the majority of Emerging market debt rose by emerging market economies, in- $2.5tn to a record $58.5tn in the creased to 318%. fi rst quarter. That is the fi rst quarterly in- Variable-rate debt holders crease in the debt-to-GDP ratio face greater risks because of ris- since the third quarter of 2016. ing benchmark interest rates, the “With global growth losing IIF said, noting that over 10% some momentum and becoming of emerging market corporate Goldman Sachs Group headquarters in New York. Goldman Sachs and Morgan Stanley both fell short in the Fed’s projections by two key measures, including their Tier 1 more divergent, and US bonds are pegged to this asset leverage ratio. rates rising steadily, worries class. about credit risk are returning “For many emerging mar- to the fore — including in many kets, which rely heavily on bank mature economies,” the IIF said. fi nancing, higher borrowing Since December 2015, the US costs for banks could be passed Federal Reserve has raised inter- through to the corporate and est rates seven times to a range of household sectors, so something 1.75% to 2.00%, with more in- of a hidden risk in terms of this creases expected. Debt levels for fl oating rate borrowing,” said IIF Dreams of Goldman household, non-fi nancial cor- Senior Director Sonja Gibbs. porate and general government Mature economies are even sectors rose to $186tn in the fi rst more reliant on variable rate quarter of 2018. debt, the report said, with the Financial sector debt rose to a ratio among G7 economies rang- record high $61tn. ing from 18% in Canada to 38% doing big takeover meet High debt levels in the non- in the United States and Italy. Dollar rises as trade war fears Fed stress test’s reality fade, risk sentiment returns Reuters monetary tightening. The green- Bloomberg annual stress tests. The pair got spe- “To the extent that they can make ac- two key measures, including their Tier 1 London back could enjoy a further boost New York cial permission to continue paying out quisitions it would help them grow their leverage ratio. if US consumer price inflation capital to shareholders at past levels loan balance - essentially put the depos- Many other banks, in contrast, were figures beat expectations when - even though the regulator projected its they already have to use through loan estimated to have billions of dollars of The dollar strengthened broadly they are published tomorrow. lmost 10 years after the fi nancial such distributions could leave them origination - that could be interesting,” excess capital - even after they finish yesterday and neared a six-month A broad appetite for risk in crisis, Wall Street was starting to with too little capital in a severe eco- he said. their proposed payouts to sharehold- high against the Japanese yen as currency markets yesterday lifted Awonder aloud: Might Goldman nomic shock. On the other hand, there are all sorts of ers. Firms with those buffers would be investors bought riskier assets, the dollar against the Japanese Sachs Group Inc or Morgan Stanley make The results show how difficult it impediments. freer to make acquisitions, if they see encouraged by signs that trade yen, a currency usually bought in a big acquisition? would be for Goldman Sachs and Mor- For one, the investment banks’ rela- opportunities. tensions have yet to hurt eco- times of political uncertainty. At Goldman, the question arose on gan Stanley to make a major takeover, tively low valuations aren’t helpful, KBW Investors are recalibrating their ex- nomic momentum. It was up 0.5% at ¥111.35, ap- a conference call in April, as analysts said Mike Mayo, the analyst who had analyst Brian Kleinhanzl said. Their pectations for takeovers as the 2008 fi - As the second-quarter cor- proaching a six-month high. examined the firm’s ambitious plan raised the question with Chavez just price- to-book ratios are hovering below nancial crisis fades and President Donald porate earnings season begins Elsewhere, the British pound to expand banking services for con- months ago. that of regional banks, and signifi cantly Trump’s administration eases regula- investors appear to be ignoring recovered some of the losses suf- sumers. Chief financial officer Marty Back then it made sense to wonder, less than that of asset managers, making tion. the deepening trade conflict fered after two ministers quit over Chavez was measured: Usually the because Goldman was looking to ex- an acquisition in either space that much Earlier this year, a KBW research re- between the United States and the government’s Brexit plans. company leans toward smaller “bolt- pand in so many areas, the Wells Fargo harder. port set some tongues wagging about China. Instead the focus is on Expectations that Theresa May on” acquisitions, he said, but it’s also & Co analyst said in an interview last There’s also little political appetite to takeovers. The authors highlighted per- decent economic data, including will survive as Prime Minister to “open-minded.” week. “But now, with less dry powder, let global banks grow even further, said sistent questions they’ve received from favourable US jobs figures and a start negotiating her blueprint At Morgan Stanley, most of the chat- that possibility seems to be incremen- Karen Petrou, co-founder of Federal Fi- investors on potential deals, and men- healthy rise in German exports, with the European Union briefly ter was behind the scenes. Speaking on tally less.” nancial Analytics, a research and adviso- tioned the possibility that Goldman which have pushed the dollar and pushed sterling into positive ter- condition they not be named, dealmak- In interviews, several analysts pre- ry fi rm in Washington. And depending on Sachs could accelerate its expansion be- the euro higher. ritory on Tuesday, though gross ers around Wall Street - including some dicted both fi rms will limit themselves to the deal, it could become all the harder yond past bolt-ons. “Despite a hesitant start to July, domestic product data in line with inside the fi rm - batted around names of small deals. Representatives of the banks for them to clear future tests. The stress test results underscore just the US dollar remains among the forecasts and the stronger dollar asset managers the bank could acquire to declined to comment. “A bigger bank would have a harder how unlikely that is, KBW’s Kleinhanzl strongest of currencies out there, weighed on the currency. build out its business. Caveats abound. If either fi rm spots a time passing,” Petrou said in an inter- said in an interview. If they were to pull owing to a hawkish central bank,” The pound had tumbled more “We can do a number of fi ll-ins,” chief golden opportunity, it could temporar- view. “Goldman and Morgan Stanley one off , investors might have to wait said Forex.com market analyst than a cent on Monday to below executive offi cer James Gorman said at a ily reduce shareholder payouts to free up scraped by this time, but with a bigger many years to see a return. Fawad Razaqzada. The Federal $1.32 amid speculation that Brit- conference when asked about the possi- capital and seek a blessing from regula- balance sheet boosted by deposits, from “Capital constrained banks can do Reserve is expected to raise US ain was descending into deep bility in May. tors. Authorities might embrace a plan a bank they buy let’s say, the test would all-stock deals, but then the new shares interest rates twice more this political turmoil less than nine Much of that speculation got a real- that encourages more lending, said Jeff punish them even harsher.” they issue to make the purchase will di- year at a time when other major months before it is to exit the EU ity check on June 28 when both firms Harte, an analyst at Sandler O’Neill & Goldman Sachs and Morgan Stanley lute their existing shareholders,” he said. central banks are refraining from in March 2019. scraped through the Federal Reserve’s Partners. both fell short in the Fed’s projections by “That’s also a very hard sell.” Russia may use $1.5bn VTB stake to boost VEB’s capital Trade row won’t stop Bank of Canada

Reuters infrastructure, education and healthcare interest rate hike, at least not yet Moscow over the next six years. To find at least some of that money, the government has proposed to increase value-added-tax, the Reuters douse nascent business investment Russian authorities are considering retirement age and raise more debt. Toronto and hammer consumers already transferring a stake owned by state- VEB’s Shuvalov said in May the size of the weighed down by higher interest controlled Otkritie bank in the country’s future capital injection would have to be rates. second largest lender, VTB, to state decided by the finance ministry. trade row between Canada “This is going to create a lot development bank VEB, three sources A source familiar with the matter said one and the United States won’t of uncertainty regarding invest- familiar with the discussions told of the options being considered to bolster Abe enough to stop the Bank of ment. If you have to build a new Reuters. VEB’s finances was a transfer to the bank Canada from raising rates this week, plant, you have to think twice The deal, if it went ahead, would fit in with of Otkritie’s 15% stake in VTB, which but bigger storm clouds over trade about whether Canada is the a broader move in Russia’s banking sector Otkritie got when it was still a private could mean it is the last hike for a right place to do so,” said Jean- and economy, where once privately-held commercial lender. while, analysts and fi nancial mar- Paul Lam, economics professor assets are being transferred to state This was confirmed by two other sources kets believe. at the University of Waterloo in entities that are taking on a more powerful — a state banker and a high-ranked While the central bank is Ontario. role in the economy. off icial. widely expected to raise interest Canada struck back in June at The 15% stake which could be transferred The central bank, which owns Otkritie, rates to 1.50% from 1.25% today the Trump administration over US is worth around $1.5bn at current market and VEB did not reply to Reuters’ to head off inflation pressures, steel and aluminium tariff s, vow- prices. Otkritie bank is a former private requests for comment. Otkritie bank said observers expect the bank to at- ing to impose punitive measures lender which was bailed out by the central it was not currently discussing such an tempt a “dovish hike,” signalling on C$16.6bn ($12.63bn) worth of bank last year. idea. a more cautious stance amid a Bank of Canada headquarters in Ontario, Canada. A trade row between American goods until Washington The Russian government holds a further The finance ministry declined to brewing trade war. Canada and the US won’t be enough to stop the central bank from raising relents. 61% stake in VTB. comment. The sources said no final “The exact impact of the tariff s rates this week, but bigger storm clouds over trade could mean it is the last US tariff s on Canadian steel and The rest of the shares are traded on the decision had been taken. is tricky, but at the moment they hike for a while, analysts and financial markets believe. aluminium and retaliatory Cana- market. Anton Lopatin, an analyst with Fitch are happy to accept the measures dian tariff s on C$16.6bn worth of VEB, headed by former first deputy prime ratings agency in Moscow, said assets are too small to aff ect what they are which has raised rates three times need to have fairly explicit forward American goods, including metals minister Igor Shuvalov since May, is set such as real estate or equity stakes could going to do this week,” said Stephen since July 2017 but has been on hold guidance and it just doesn’t really but also foodstuff s such as cof- to be recapitalised to serve as one of the be used to boost a bank’s capital. “There Brown, senior Canada economist at since January. seem like Poloz’s style,” said An- fee and ketchup will likely boost key vehicles for President Vladimir Putin’s have already been such examples in Capital Economics. While the bank may attempt a drew Kelvin, senior rates strategist infl ation and growth in the short new investment drive after his re-election Russia in the past,” Lopatin said. Poloz has already implied the dovish hike that is accompanied by at TD Securities. term, as businesses and consum- this year. “But there is a risk that the value of new tariff s could be an argument for guidance that reduces expectations The Bank of Canada did not off er ers scramble to fi nd new suppliers VEB also needs the fresh capital after the assets can go down, so the capital raising rates, but has said the bank for additional tightening, Poloz’s immediate comment. or imports. running into problems with past injection can end up being lower than cannot set monetary policy on the distaste for explicit forward guid- In the short term, the bank can Dan Ciuriak, senior fellow at the investments dating back to the Sochi 2014 planned. risk there will be more tariff s, Brown ance likely means tariff s and trade point to higher infl ation, stronger Centre for International Govern- Olympics. The conventional way to boost a firm’s noted. will be raised as a risk, without a wage growth, and job gains as evi- ance Innovation, said Canada’s In May, Putin ordered at least 8tn roubles capital — issuing new shares — is more Financial markets have priced clear signal for the timing of the dence Canada’s economy is robust, retaliatory tariff s alone will boost worth ($128.4bn) of state spending on solid in our view.” in a more than 90% likelihood of a next rate move. but the protectionist rhetoric of consumer prices by about 0.2 per- rate increase this week by the bank, “You can do a dovish hike but you US President Donald Trump could centage point. Wednesday, July 11, 2018 GULF TIMES BUSINESS

Opec+ oil production boost to reassure market investors: EIU

The 1mn barrels per day “Despite the diff erences in pro- production boost by Opec and duction capacity, all members its allies will help to reassure do fundamentally benefit from market investors and prevent an environment in which prices a spike in oil prices in the near are more stable and avoid an- term, Economist Intelligence other dramatic crash driven by Unit (EIU) has said in a report. a shale boom. As a result, they This would be equivalent to were able to achieve an agree- about 1% of global supply, EIU ment, firstly among the Opec noted. countries and then on June 23 Nonetheless, EIU said a with their non-Opec partners,” “number of geopolitical risks EIU said. remain”, including the potential In November 2016 Opec and for further output declines from major non-Opec exporters, Iran and Venezuela, which will particularly Russia made a push oil prices gradually higher decision to cut nearly 1.8mn over the remainder of 2018. barrels per day (bpd) from sup- “The fundamental problem ply. This had a dramatic impact facing Opec at its ministerial on the oil market, particularly meeting in Vienna on June 22 from mid 2017 after compli- was that some of its members ance began to improve, and the do not have the capacity to deal was twice extended, first rapidly increase output even if until March 2018 and then until quota caps are relaxed, given December. problems related to under- A pick-up in the global econ- investment and politics,” EIU omy, boosting demand, and said. problems with some produc- “This means that they would ers, notably Venezuela, which suff er revenue hit from lower saw them producing below prices without a counterbalanc- their Opec quota, added to the ing increase in volume,” EIU upward pressure on oil prices, said. Venezuela’s output in May which rallied by more than was just 1.4mn bpd, its lowest in 50%, hitting a four year high of The bullish outlook of foreign funds and the increased net buying interests of their Gulf counterparts led the QSE’s 20-stock Qatar Index gain 1.41% to 9,395.81 points yesterday. 30 years, as domestic political $79/barrel in May, a level which and economic turmoil has had seemed almost incon- undermined the oil sector. ceivable back in 2016, when This, EIU said was down from prices averaged just $44/b. 2.1mn bpd in October 2016, “However, the success of the making the reduction more deal in bolstering prices stoked than seven times greater than complaints from oil consum- its obligation under the Opec ers — notably the US president, deal, which is also described as Donald Trump — and added QSE inches towards 9,400 more than 700% “compliance” to worries of a repeat of the with its cut target. previous crash, as high prices Angola, meanwhile, has strug- motivate investment in new gled owing to underinvest- capacity outside the exporter ment since the collapse in oil bloc, particularly in US shale. prices in 2015, meaning that “This all led to a growing levels on buying support it produced just 1.5mn bpd consensus that the exporters in May, equivalent to a 290% need to release more oil to put By Santhosh V Perumal 10.24% gains year-to-date. major movers being QNB, In- QR6.75mn against net buyers of volume almost doubled to compliance rate. a ceiling on prices,” EIU said. Business Reporter However, local and Gulf retail dustries Qatar, Ooredoo, Qatar QR7.48mn on Monday. 1.29mn shares and value more investors as well as domestic Islamic Bank, Qatari Investors Non-Qatari individual inves- than doubled to QR20.51mn on institutions turned bearish on Group, Mesaieed Petrochemi- tors’ net selling increased con- 63% expansion in deals to 499. n across-the-board buy- the bourse, whose capitalisation cal Holding, Milaha, QIIB, Ahl- siderably to QR2.28mn com- The telecom sector reported ing — especially in bank- shot up 1.44% to QR512.08bn, ibank and Medicare Group; even pared to QR1.08mn the previous 77% surge in trade volume to Aing and telecom — yes- mainly on large caps. as Gulf International Services, day. 5.28mn equities to more than terday lifted the Qatar Stock Trade turnover and volumes Mazaya Qatar, Woqod, Salam The Gulf individuals turned double value to QR69.96mn on Exchange whose key barometer were on the increase on the mar- International Investment, Dlala net profi t takers to the extent of 35% rise in transactions to 560. Egypt infl ation rate inched towards 9,400 levels and ket, where telecom alone ac- and Doha Bank were among the QR0.61mn against net buyers of The transport sector’s trade capitalisation gained more than counted for more than 49% of losers. QR0.42mn on July 9. volume soared 30% to 0.6mn QR7bn. the total volume. Non-Qatari institutions Total trade volume grew 69% stocks, value by 58% to QR12.13mn accelerates for fi rst The bullish outlook of foreign The Total Return Index gained turned net buyers to the tune of to 10.72mn shares, value by 95% and deals by 24% to 257. funds and the increased net buy- 1.41% to 16,554.37 points, All QR43.27mn compared with net to QR255.76mn and transactions The banks and fi nancial serv- ing interests of their Gulf coun- Share Index by 1.25% to 2,710.53 sellers of QR11.08mn on Mon- by 44% to 3,711. ices sector saw 28% surge in time in 11 months terparts led the 20-stock Qatar points and Al Rayan Islamic In- day. The consumer goods sector’s trade volume to 1.8mn shares, Index gain 1.41% to 9,395.81 dex (Price) by 1.03% to 2,296.04 The Gulf institutions’ net trade volume more than quadru- 64% in value to QR76.34mn and points. points. buying strengthened infl u- pled to 0.45mn equities and val- 29% in transactions to 994. Bloomberg tricity price increases didn’t go Both Masraf Al Rayan- and The banks and fi nancial entially to QR4.91mn against ue almost tripled to QR27.64mn The industrials sector’s Cairo into eff ect until July 1, the full Doha Bank-sponsored exchange services index rose 1.74%, tel- QR0.8mn the previous day. on 89% increase in deals to 329. trade volume increased 27% to impact on infl ation should be traded funds, QATR and QETF, ecom (1.41%), industrials (1.3%), However, local individuals The insurance sector’s trade 0.65mn equities, value by 86% mostly captured by July, Cairo- were, however, down 0.68% and transport (0.84%), insurance turned net sellers to the extent of volume more than tripled to to QR33.47mn and deals by 42% gypt’s infl ation acceler- based investment bank Naeem 0.54% respectively. (0.52%), realty (0.35%) and con- QR38.57mn compared with net 0.65mn stocks and value almost to 788. ated for the fi rst time in 11 Holding said in a research note. Islamic stocks were seen un- sumer goods (0.2%). buyers of QR3.46mn on July 9. tripled to QR15.7mn on 84% In the debt market, there was Emonths in June after the Pharos Holding, in an e- derperforming the other indices More than 65% of the trad- Domestic funds were also jump in transactions to 284. no trading of treasury bills and government slashed fuel and mailed note, said it expects the in the market, which reported ed stocks extended gains with net profi t takers to the tune of The real estate sector’s trade sovereign bonds. electricity subsidies to help re- central bank to hold interest duce the budget defi cit. rates until its November meet- Infl ation in urban parts of ing, “when infl ation numbers the country, the rate closely would have decelerated and any watched by the central bank, potential cuts at that time will Most Gulf stock markets end day higher climbed to 14.4% from 11.4% in be linked to global markets’ de- May, according to the state sta- velopments.” Reuters it is raising its 12-month price target to Saudi not only in banks, but also in Property and financial stocks lifted Abu tistics agency. Prices rose 3.5% Annual core infl ation, the Dubai 18.5 riyals from 16.9 riyals, on the back of petrochemicals. Chemical product prices Dhabi stocks, which ended 1.1% higher at on the month, the most since gauge that strips out volatile higher estimates to reflect higher product have been strong over the last quarter 4,669 points. January last year. items, was 10.9% in June — its pricing and lower feedstock costs. and that would show in earnings.” Aldar Properties rose 2.4% and First Abu The central bank kept its lowest level since April 2016, ac- Most Gulf stocks ended higher Saudi Basic Industries was up nearly 1%. Strong quarterly earnings for National Dhabi Bank climbed 1.6%. benchmark interest rate un- cording to Bloomberg data. That yesterday, while firm oil prices boosted Financial stocks also rallied with Samba Bank of Kuwait lifted Kuwait’s index 1.1% Property stocks also rallied in Dubai, changed on June 28, saying puts it well within the central petrochemical stocks in Saudi Arabia. Financial Group surging 3.5% and Al Rajhi to 5,302 points, which also fuelled gains in lifting the benchmark index by 0.7% to government measures to shore bank’s target range of 13% (+/- The Saudi index rose 1.1% to 8,418 points Bank up 1.2%. other financial stocks. 2,896 points. up public fi nances were “ex- 3%). The International Mon- as higher oil prices boosted shares of “We believe most Saudi Arabia large caps National Bank of Kuwait posted a 16% rise Elsewhere, the Bahrain index closed pected to lead to one-off in- etary Fund, which has granted petrochemical companies. trade are at full valuations,” said Vrajesh in second-quarter net profit from a year flat to 1,335 points and the Oman index creases in the price level, which Egypt a $12bn loan, said ear- Saudi Kayan Petrochemical was up almost Bhandari, a portfolio manager at Al Mal earlier, boosting its share price by 0.6%. closed down 0.4% at 4,498 points, while translate into temporary higher lier this month that the central 1% at 16.88 riyals. Capital. Kuwait Finance House rose 1.5% and Gulf the Egypt index rose 0.8% to 15,917 infl ation rates.” bank should maintain a tight Goldman Sachs said in a report this week “Still, we do find pockets of value in Bank climbed 1.7%. points. Because the fuel cuts were monetary policy after the latest enacted in early June, and elec- subsidy cuts.

Milaha Explorer deployed off West Africa coast as Saudi securities part of long-term charter with a major oil firm regulator awards Milaha, a Qatar-based maritime and logistics conglomerate, has deployed its lift boat, ‘Milaha Explorer’, off the coast of West Africa as part of a long-term charter 2 fi ntech licences with a major international oil company. Milaha Explorer, which is the largest of its kind and to be owned by a Qatari Reuters The ventures could serve two company, has large a deck area, variable Dubai aspects of Saudi Arabia’s re- load capacity and can accommodate 300 form programme: broaden its people on board. capital markets, and create jobs “Over the past few months, we have been audi Arabia’s securities by helping entrepreneurs ob- significantly ramping up our operations, regulator approved its fi rst tain funding for new ventures. and I am pleased to announce further Stwo fi nancial technol- The CMA said it would re- growth in our geographic footprint and ogy licences yesterday, part of a ceive applications for more fin- operational portfolio with this long-term drive to develop a fi ntech sector tech licences later this year. deployment, which marks our entry in the economy under reforms The Saudi central bank has into Africa,” Milaha president and chief designed to reduce reliance on also thrown its weight behind executive Abdulrahman Essa al-Mannai oil exports. fi ntech. said. The Capital Market Authority In February, it signed a deal Milaha took delivery of Milaha Explorer in approved licences allowing Riya- with US-based Ripple to help 2016, and it is part of the group’s marine dh-based start-up Manafa Cap- banks in the kingdom settle pay- off shore fleet, which is comprised of ital and another fi rm, Scopeer, to ments using blockchain soft- over 47 anchor handling towing vessels, off er crowdfunding investment ware. platform support vessels, dive and services on a trial basis, the CMA Gulf Capital, an Abu Dhabi- construction support vessels, and other said yesterday. based private equity firm, said vessel types supporting the off shore oil Individual investors will use in May 2018 that it had bought and gas industry. electronic platforms operated a stake in Geidea, the leading Milaha’s overall fleet consists of more by the companies to fund small provider of electronic pay- than 90 vessels, which also include oil and medium-sized enterprises ment solutions in Saudi Arabia, tankers, liquefied natural gas carriers, The crew of Milaha Explorer pose for a photograph. Milaha Explorer has large a deck area, variable load capacity and can in exchange for shares in those in a deal worth over 1bn riyals and container vessels among others. accommodate 300 people on board. enterprises. ($267mn).