U Capital Morning Brief 1 May 2017

GCC Market Indices Current Close Previous Close Change D/D MTD YTD Index Index Point % % % U Capital 20 Index 1,014.93 1,023.25 -8.32 -0.81% 0.39% -3.61% U Capital GCC 50 Index 1,147.47 1,151.23 -3.76 -0.33% -0.16% -2.61% U Capital MENA 200 Index 1,006.23 1,011.67 -5.44 -0.54% 0.51% -1.22% Bloomberg GCC200 Index 64.08 63.74 0.34 0.53% -0.70% -1.75% Securities Market 5,513.52 5,525.43 (11.91) -0.22% -0.67% -4.66% Saudi Stock Exchange 7,013.47 6,945.74 67.73 0.98% 0.17% -2.73% Stock Exchange 6,843.01 6,854.27 (11.26) -0.16% -2.65% 19.05% Exchange 10,064.35 10,089.86 (25.51) -0.25% -3.14% -3.57% Stock Exchange 1,335.67 1,332.16 3.51 0.26% -1.50% 9.44% Dubai Financial Market 3,414.93 3,416.71 (1.78) -0.05% -1.88% -3.28% Abu Dhabi Sec. Exchange 4,522.56 4,512.91 9.65 0.21% 1.78% -0.52% Source: Bloomberg

World Markets* Country Value Change D/D Commodity Prices* Price Change D/D Europe % USD USD % FTSE 100 United Kingdom 7,203.9 (33.23) (0.46) Brent Crude (per bbl) Updated 51.89 (0.16) (0.31) DAX Germany 12,438.0 (5.78) (0.05) WTI Crude (per bbl) Updated 49.23 (0.11) (0.22) CAC 40 France 5,267.3 (4.37) (0.08) Oman Crude Oil (Last Closing) 51.12 0.18 0.35 United States DJIA USA 20,940.5 (40.82) (0.19) S&P 500 USA 2,384.2 (4.57) (0.19) Gold100 OZ (per oz) 1,263.76 (4.53) (0.36) NASDAQ USA 6,047.6 (1.33) (0.02) Silver (per oz) 17.12 (0.08) (0.46) Asia Pacific NIKKEI 225 Japan 19,292.9 94.43 0.49 Platinum (per oz) 942.85 (2.60) (0.27) HANG SENG Hongkong 24,615.1 (83.35) (0.34) Copper, MT 5,735.50 43.50 0.76 Selected Middle East Aluminium, MT 1,911.50 (12.50) (0.65) Tunis Se Index Tunis 5,648.2 (21.53) (0.38) Lead, MT 2,249.00 44.00 2.00 EGX 30 Index Egypt 12,433.6 (92.09) (0.74) Zinc, MT 2,623.00 26.00 1.00 Blom Stock Index Lebanon #N/A N/A (1164.38) (100.00) Nickel, MT 9,450.00 115.00 1.23 Source: Bloomberg, U-Capital- at 8:30AM M uscat time Source: Bloomberg, U-Capital- at 8:30AM M uscat time

Cross Rate for Major Currencies* Currency Code USD/1 Unit Units/1 USD Euro EUR 1.089 0.918 British Pound GBP 1.291 0.775 Japanese Yen JPY 0.009 111.660 Chinese Renminbi CNH 0.145 6.901 Indian Rupee INR 0.016 64.245 Russian Ruble RUB 0.018 56.930 Canadian Dollar CAD 0.731 1.367 Australian Dollar AUD 0.748 1.336 Source : Bloomberg Note: all prices/indices are updated till 8:30 AM M uscat time.* markets are closed on Saturday and Sunday

1 P.O.BOX 1137, PC 111 – CPO, Sultanate of Oman l CR No. 1279406 l Tel: +968 2494 9000 l Fax: +968 2494 9099 l Email: [email protected] l Web: www.u-capital.net

OMAN ECONOMIC & CORPORATE NEWS

Audit firm calls for effective corporate governance Crowe Horwath Oman, an auditing and accounting firm, has called for creating effective corporate governance practices, especially in view of the economic slowdown and reductions in budget expenditures. Source: Times of Oman

Fixed telephone lines rise 7.2pc in March The Sultanate’s total number of fixed telephone lines till March stood at 453,140 as against 449,258 fixed telephone lines registered by February comprising a rise by 7.2 per cent, according to a report from the National Centre for Statistics and Information (NCSI). Source: Oman Tribune

New strategy to achieve early monetisation of oil, gas finds Petroleum Development Oman (PDO) is employing an award-winning concept to achieve the early monetisation of newly discovered hydrocarbon assets at key locations across its Block 6 license. Source: Oman Observer

OIL MARKETING FIRMS’ PROFITS FALL ON LOWER FUEL DEMAND Oman’s oil marketing companies recorded sharp declines in their profits for the first quarter of 2017, mainly due to a fall in retail volume demand. However, the sultanate’s all three oil marketing firms - Oman Oil Marketing Co, Al Maha Petroleum Products Marketing Co and Shell Oman Marketing – recorded significant growths in sales revenues due to higher retail prices of petrol and diesel at the pump. Source: Muscat Daily

NBO completes first pilot cross border banking transaction using blockchain technology Underscoring its position as a front-runner in digital banking solutions, National Bank of Oman (NBO) announced the successful completion of the international remittances pilot project using blockchain technology. Source: Muscat Daily

Oman needs to push for free trade pact with UK in post Brexit era Oman’s oil marketing companies recorded sharp declines in their profits for the first quarter of 2017, mainly due to a fall in retail volume demand. Source: Muscat Daily

Omantel receives letter from Oman Investment Fund on shares transfer Oman Telecommunications Co: Receives letter from Oman Investment Fund notifying Omantel that fund has transferred its shares in Omantel to United International Teleco Investment & Projects. Source: Reuters

MIDDLE EAST ECONOMIC & CORPORATE NEWS

Saudi POS transactions up 6% in March Point-of-sale (POS) transactions in rose 6 percent to SAR 16.3 billion in March from SAR 15.4 billion a year earlier, official figures from the kingdom’s central bank showed. Source: Argaam

SAMA may allow foreign insurers to operate in Saudi Arabia The Saudi Arabian Monetary Authority (SAMA), the central bank and insurance sector regulator, will consider requests by foreign insurance firms to operate in the Kingdom, senior executive said on Sunday. Source: Argaam

UAE, Qatar and Saudi Arabia most 'connected' nations in Arab world The UAE, Qatar and Saudi Arabia remain top “adopter” economies in terms of connectivity within the Arab world, according to Huawei’s Global Connectivity Index (GCI) 2017 report. Source: Zawya

Shareholders of Saudi gym chain Bodymasters consider Nomu listing-sources Shareholders of Saudi Arabia's Bodymasters are talking to banks and weighing a listing of the fitness chain on Saudi Arabia's new parallel market, Nomu, sources told Reuters. Source: Zawya

2 P.O.BOX 1137, PC 111 – CPO, Sultanate of Oman l CR No. 1279406 l Tel: +968 2494 9000 l Fax: +968 2494 9099 l Email: [email protected] l Web: www.u-capital.net

IMF Mission Starts Talks in Egypt Amid Interest Rates Debate An International Monetary Fund team will start its first review of Egypt’s $12 billion loan accord on Sunday, with the debate on how best to curb inflation likely to take center stage. Source: Bloomberg

Insurance firms will have to Saudize top positions: SAMA governor Saudi Arabia’s insurance companies will have to train Saudis and hire them in technical and leading positions, after completing Saudization of the claims and customer care departments, said Ahmed Abdulkarim Alkholifey, governor of Saudi Arabian Monetary Authority (SAMA). Source: Argaam

INTERNATIONAL ECONOMIC & CORPORATE NEWS

Twenty-First Century Fox in talks with Blackstone to buy Tribune Twenty-First Century Fox Inc (FOXA.O) is in talks with Blackstone Group LP (BX.N) about submitting an offer to buy Tribune Media Co (TRCO.N), one of the largest U.S. television station operators, sources familiar with the matter said on Sunday. Source: Reuters

Asian equities steady as Japan outperforms, dollar regains traction Asian stocks shook off a sluggish start and steadied on Monday, with Japan outperforming on upbeat earnings, while the dollar regained traction as the U.S. government looked likely to avoid a shutdown. Source: Reuters

Sudden collapse of Alitalia would be a shock to Italy's economy-minister A sudden collapse of loss-making national airline Alitalia [CAITLA.UL] would be a great shock for Italy's economy, Industry Minister Carlo Calenda said on Sunday. Source: Reuters

COMMODITIES NEWS

Gold bears likely to take charge as interest rates eyed Gold bears may take charge as a stronger dollar and a swift rise in interest rates may continue to weigh on sentiment. On Friday, gold traded at $1,269.50 an ounce, the lowest level in nearly two weeks. Source: Zawya

Saudi Arabia aims for consensus on production cuts ahead of OPEC meeting Saudi Energy Minister Khalid Al Falih’s latest visit to Central Asia is seen as part of the Kingdom’s efforts to gain consensus for the extension of the production cut agreement between OPEC and non-member countries ahead of the upcoming May 25 meeting in Vienna, analysts told Argaam. Source: Argaam

3 P.O.BOX 1137, PC 111 – CPO, Sultanate of Oman l CR No. 1279406 l Tel: +968 2494 9000 l Fax: +968 2494 9099 l Email: [email protected] l Web: www.u-capital.net

Ubhar Capital SAOC (U Capital)

Website: www.u-capital.net PO Box 1137 PC 111, Sultanate of Oman Tel: +968 2494 9000 Fax: +968 2494 9099 Email: [email protected]

Disclaimer: This report has been prepared by research department in Ubhar Capital SAOC (U Capital), and is provided for information purposes only. Under no circumstances is to be used or considered as an offer to sell or solicitation of any offer to buy. While all reasonable care has been taken to ensure that the information contained therein is not untrue or misleading at the time of publication, we make no representation as to its accuracy or completeness and it should not be relied upon as such, and the bank accepts no responsibility whatsoever for any direct or indirect consequential loss arising from any use of this report or its contents. All opinions and estimates included in this document constitute U Capital’s Research department judgment as of the date of production of this report, and are subject to change without notice. This report may not be reproduced, distributed or published by any recipient for any purpose.

4 P.O.BOX 1137, PC 111 – CPO, Sultanate of Oman l CR No. 1279406 l Tel: +968 2494 9000 l Fax: +968 2494 9099 l Email: [email protected] l Web: www.u-capital.net