WEEKLY MARKET

MONITOR WEEK 13 / 25 MAR -31 MAR, 2013

THE WEEK IN BRIEF

Ö INDIA Cuts Rates by 25 Basis Points To 7.5 % To Revive Growth Ö Senate Passes Legislation to Avoid U.S Government Shutdown CONTACTS Ö Fed Keeps $85 B Pace of Bond Buying as Job Market Improves Ö U.K Deficit Seen Falling to %7.4 GDP in 2013, 6.8% in 2014 Ibrahim Itani 961‐1‐360460 Ext.786 Ö ECB Says It Will Provide Liquidity to Within Existing Rules [email protected] Ö Buffett Reclaims World’s Third Richest Title as Ortega Retreats

Fouad Abou Hassan Ö Cyprus Cut to CCC From CCC+ by S&P, Outlook Negative 961‐1‐360460 Ext.787 Ö Congress Clears Spending Plan for FY 2013, Averting Shutdown [email protected] Ö Index of Leading Economic Indicators in the U.S Increase 0.5% Joseph Kalaydjian Ö Emirates $1 B Sukuk Officially Listed on Nasdaq Dubai 961‐1‐360460 Ext.788 [email protected] Ö Bernanke Says Easing by Advanced Nations Helps World Economy Ö Cyprus Reaches 10 Billion Rescue Deal with Troika Ö Saudi Bank Deposits Rise to SAR 1.27 Trillion Ö Cyprus Delay Bank Re‐Open Until Thursday

EURO TECHNICALS

1.3051

RESISTANCE 1.3165

1.3290

1.2828

1.2714 SUPPORT 1.2590

On Monday Euro/Dollar sunk with 220 pips on Cyprus deal details. The European currency depreciated from 1.3051 to 1.2828 yesterday, Break above the nearest resistance and yesterday's top at 1.3051 may trigger further strengthening of the Euro. Going bellow yesterday's bottom and first support at 1.2828, however, would confirm continuation of the bearish trend, towards next objective downwards 1.2714. GOLD TECHNICALS

1613

RESISTANCE 1624

1633

1590

SUPPORT 1577

1665

Gold prices traded lower by 0.25% against the USD at 1604.36 per ounce, as a bailout deal to avoid a collapse of Cyprus’ banking system reduced the metal’s safe‐haven appeal. In the Asian session today, Gold was trading at 1601.98, 0.15% lower from yesterday’s close. Gold is expected to find support at 1590.29, and a fall through could take it to the next support level of 1578.61. Gold is expected to find its first resistance at 1613.24, and a rise through could take it to the next resistance level of 1624.51.

GLOBAL COVERAGE

INDEX MARKET OPEN MARKET CLOSE The European Union gave CYPRUS until Monday to 18‐03‐13 22‐03‐13 raise the billions of it needs to secure an DOW 14452.06 14447.75 INTERNATIONAL BAILOUT or face a collapse of its S&P 500 1552.10 1551.69 financial system that could push it out of the euro NASDAQ 3237.59 3235.30 currency bloc. A bailout deal brokered between Cypriot President and the EU last INDEX MARKET OPEN MARKET CLOSE weekend in Brussels was unanimously rejected by the 18‐03‐13 22‐03‐13 Mediterranean island nation’s parliament. The deal NIKKEI 12220.63 12546.46 would have imposed a tax on Cypriot deposit accounts HANGSENG 22083.36 22251.15 to raise 5.8 billion Euros that the EU required in return ASX 200 5015.40 4990.20 for a 10 billion euro bailout. Standard & Poor’s cut the sovereign long term foreign currency credit rating on INDEX MARKET OPEN MARKET CLOSE Cyprus deeper into junk status, lowering the rating to 18‐03‐13 22‐03‐13 CCC from CCC‐plus as the country struggles with a DAX 8010.70 7.911.351 banking crisis. Jeroen Dijsselblem, the head of the STOXX 50 2705.47 2681.67 Euro Group, which comprises the finance ministers of FTSE 100 6457.92 6392.76 countries whose currency is the euro, urges Cyprus to present a new proposal on the bailout. The European Central Bank has provided a liquidity lifeline, allowing Cyprus’ banks to operate. However, that lifeline knows as Emergency Liquidity Assistance (ELA), will be cut on Monday if no new deal is in place. Under the levy rejected by parliament, EU lenders, notably Germany, had wanted uninsured bank depositors to bear some of the cost of recapitalizing the banks, but Cyprus feared for its future reputation as an offshore banking haven and planned to spread the burden also to small savers whose deposits under 100,000 were covered by state insurance. Lawmakers threw it out. In Moscow since Tuesday, Cypriot Finance Minister Michael Sarris said he was discussing possible Russian investments in banks and energy recourses, as well as an extension of an existing 2.5 billion euro Russian loan. The Russian Finance Ministry had said that sought an extra 5 billion euro loan.

The senate approved legislation to AVERT A GOVERNMENT SHUTDOWN next week freeing Democrats and Republicans to spend the next few months arguing over deeply divided strategies to shrink longer term budget deficits. Congress gave final approval to legislation to avert a partial government shutdown in a rare example of bipartisan cooperation on federal spending. The House voted 318‐109 to send the budget bill, which would fund federal agencies through Sept. 30, the end of the 2013 fiscal year to President Barack Obama for his signature. The bill will keep government agencies and programs funded through the end of the fiscal year. Without new government spending legislation enacted by March 27, federal agencies and discretionary programs ranging from the department of transportation to national parks would have faced a shutdown. Both parties opted against risking such a shutdown as they wrangle over longer term tax and spending policy. The measure pushes the next critical fiscal deadline to late July or early August, when the next increase in the federal borrowing limit will be needed.

CORPORATE NEWS

ORACLE CORPORATION (NASDAQ:ORCL) dive after severe third quarter miss. The company’s shares sank more than 8 percent a day after the company reported sharply disappointing third quarter new software revenue, which it blamed on poor sales execution. The severe miss, reported after the market close triggered a series of price target cuts from Wall Street. Credit Agricole reduced its rating on Oracle, the world’s No.3 software maker, to “underperform” from “outperform” and cut its share target price to $35 from $38. The company, which is battling fast growing rivals like Sales force and Workday in the field of Internet based software services, reported a 2 percent slip in new software sales and Internet based subscriptions. The company forecast that new software license sales, a key indicator of future revenue, will rise 1 percent to 11 percent this quarter. It warned that from its ailing hardware business will continue to shrink significantly.

BP PLC (NYSE:BP) will buy back $8 billion shares from investors after completing the sale of 50 percent of Russian oil producer TNK‐BP. BP’s first buyback since 2008 will return the original amount invested in the venture 10 years ago, the London based company said. The sum is twice as much as Chief Financial Officer Brian Gilvary signaled last year would be enough to offset earning per share lost from selling the stake in Russia’s third largest producer. The deal to sell out TNK‐BP gives Chief Executive Officer Bob Dudley a fresh start in Russia after a fractious 10 year partnership with a group of billionaires. BP shares have slumped since the 2010 Gulf of Mexico oil spill and the company face fines after a trial in New Orleans. After selling its TNK‐BP stake to OAO ROSNEFT (MCX: ROSN), BP will become the second biggest investor in Russia’s largest oil company with a 19.8 percent shareholding. Following the buyback, which will take eight to 12 months to complete, BP will retain $4.5 billion in cash from the deal.

DELL INC (NASDAQ:DELL) said it received alternative proposals from Blackstone group LP and Carl Icahn that could be superior to the $24.4 billion takeover offer from founder Michael Dell and private equity fund Silver Lake Partners. Michael Dell is willing to explore the possibility of working with third parties regarding alternative offers, the company said. However, it said the special board committee considering a sale continues to support the company’s pending sale to Michael Dell and Silver Lake. Southeaster Asset Management, the company’s largest shareholder after Michael dell and a staunch opponent of the founder’s buyout offer, said it was pleased that the two new bids were structures in such a way that shareholders could remain invested in the company. The special committee was evaluating the new takeover proposals to decide whether either or both were likely to trump the existing take private deal.

ENERGY & COMMODITIES CHINA anticipates a breakthrough in energy talks during President Xi Jinping’s visit to Moscow this week, an achievement that may strengthen ties between neighbors wary of U.S motive on issues from Iran to Asia policy. China wants to sign an agreement on a NATURAL GAS PIPELINE during Xi’s three day trip. The visit will be the first state trip abroad for Xi since he was appointed Communist Party chief in November and president last week. A deal for the pipeline would open a new market for Russian supplies as demand in Europe weakens. That and other agreements during Xi’s visit may boost relations as RUSSIA and China seek stronger alliances to counter what they see as U.S efforts to exert more influence in the Asia‐Pacific and the Middle East. Energy cooperation is the crown jewel of China and Russia cooperation. The mutual trust built upon energy cooperation could quickly spread to other areas. The state visit to Russia is part of a trip in which Xi will later head to a BRICS summit in South Africa. A deal on a gas pipeline would bring to fruition a decade of talks to supply as much as 68 billion cubic meters of gas a year to the world’s second biggest economy. China imported 42.5 billion cubic meters of natural gas, including liquefied natural gas, in 2012 up almost a third from a year ago. China’s natural gas consumption reached 147 billion cubic meters in 2012. FOREIGN EXCHANGE

INDEX MARKET OPEN MARKET CLOSE The yen fell against all its major peers as Bank of 18‐03‐13 22‐03‐13 Japan Governor Haruhiko Kuroda outlined monetary EUR:USD 1.2910 1.2985 easing options to achieve a 2 percent annual GBP:USD 1.5119 1.5224 inflation goal in two years. Japan’s currency USD:JPY 94.57 94.44 snapped a three day advance against the dollar after USD:CHF 0.9428 0.9402 Kuroda said the BOJ will consider extending the AUD:USD 1.0352 1.0442 maturities of bond purchases and scrapping a limit XAU 1597.19 1608.30 on such buying. The euro traded 0.3 percent from a XAG 28.79 28.72 four month low ahead of debt auctions in Italy, WTI 93.49 93.86 where lawmakers are trying to form a government after inconclusive elections last month. Singapore’s dollar climbed for a fourth day, the longest streak this year. The yen was little changed at 94.21 per dollar, halting a three day, 2 percent advance. It lost 0.2 percent to 121.28 per euro. Europe’s 17 nation currency rose 0.2 percent to $1.2873 from yesterday when it touched $1.2839, the lowest since Nov. 22. Kuroda told lawmakers today that the BOJ will discuss purchasing more bonds with longer maturities. The BOJ currently buys government debt maturing in three years or less through its 76 trillion yen asset purchase program. He also said the BOJ may scarp it’s so called banknote rule of keeping central bank bond holding at less than the value of banknotes outstanding. Policy specifics will be discussed at the central bank board meeting, Kuroda said, with the next one scheduled for April 3‐4

IRAQI MARKETS

opening highest lowest Closing Trading Company Name Code Price price price Price Volume

Bank Sector Commercial Bank of Iraqi BCOI 1.040 1.040 1.030 1.040 134,704,200 Bank Of Baghdad BBOB 1.860 1.860 1.840 1.840 57,730,405 Iraqi Islamic Bank BIIB 1.250 1.260 1.240 1.250 8,775,481,423 Middle East Investment Bank BIME 1.490 1.490 1.490 1.490 158,906,621 Investment Bank of Iraq BIBI 1.000 1.000 1.000 1.000 28,121,242 National Bank Of Iraq BNOI 0.800 0.800 0.800 0.800 140,799 Credit Bank Of Iraq BROI 2.780 2.780 2.640 2.760 60,901,500 Dar es salam Investment Bank BDSI 3.020 3.050 3.020 3.050 10,328,000 Babylon Bank BBAY 0.720 0.730 0.720 0.730 2,407,773 Economy Bank For Investment BEFI 0.940 0.940 0.940 0.940 2,820,000 Gulf Commercial Bank BGUC 1.290 1.290 1.280 1.280 68,220,000 Mosul Bank For Investment BMFI 0.810 0.810 0.810 0.810 63,388,091 North Bank BNOR 2.700 2.700 2.690 2.690 25,608,800 Kurdistan International Bank BKUI 2.200 2.210 2.200 2.200 469,921,500 Ashur International Bank BASH 0.810 0.810 0.800 0.800 330,557 Al-Mansour Bank BMNS 1.140 1.140 1.140 1.140 19,950,000 United Bank BUND 1.720 1.720 1.690 1.690 113,550,579 Total of Banks sector 9,992,511,491 Insurance Sector Al-Ameen for Insurance NAME 0.980 0.980 0.980 0.980 88,595 Total of Insurance sector 88,595

ECONOMIC CALENDAR DATE TIME COUNTRY EVENT FORECAST PREVIOUS MON25 19:15 Fed chairman Bernanke speaks TUE 26 02:00 BOJ Gov kuroda speaks 06:45 RBA Gov stevens speaks 14:30 Core durable goods orders m/m 0.7% 2.3% 16:00 CB consumer confidence 67.9 69.6 New home sales 426K 437K WED 27 02:00 ANZ business sentiment 39.4 11:30 Current account ‐12.8B ‐12.8B 14:30 Core CPI m/m 0.3% 0.1% 16:00 Pending home sales m/m ‐0.3% 4.5% THU28 14:30 GDP m/m 0.1% ‐0.2% Unemployment claims 340K 336K

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