Solidere Negative Results Failed to Trigger Down the Lebanese Bourse This Week

Although Solidere recorded an $87.2M loss during 2015, investors’ concerns remained contained over the week with banking stocks recovering some of their previous losses that followed 2015’s dividend distributions. As a result, the BLOM Stock Index (BSI) recorded a 0.27% weekly uptick to 1,154.82 points. As for the market capitalization, it witnessed a $25.32M progress to settle at $9.53B by the end of the week. Trading activity also saw substantial improvement as the average traded volume went up from 182,575 shares worth $1.21M last week to 431,184 shares worth $2.90M this week.

The BSI’s weekly performance stood amongst the best in the region with the S&P Pan Arab Composite Large-Mid-Cap Index and the S&P AFE 40 Index recording respective weekly rises of 0.27% and 0.25%. In contrast, the Morgan Stanley Emerging Markets Index (MSCI) revealed a 0.34% weekly loss.

Arab markets saw disparate performance this week. The top three performers were Qatar, Dubai and Tunisia with respective increases of 1.98%, 1.12% and 0.93%. Abu Dhabi, Egypt and Amman were the worst performers this week revealing weekly losses of 0.93%, 0.36% and 0.30%, respectively.

On the Beirut Stock Exchange, the banking sector took 96.19% of total traded value, while the real estate and industrial sectors contributed for the remaining 3.68% and 0.13%, respectively.

In the banking sector, Bank Audi’s shares ended the week in the green as both listed and GDR shares rose by 0.68% and 3.28% to $5.90 and $5.99, respectively. BLOM listed shares added 0.70% to end the week at $10.12, while the bank’s GDRs lost 0.77% to $10.31. Byblos listed shares decreased 0.61% to $1.63.

As for the BLOM Preferred Shares Index (BPSI), it decreased by 0.62% over the week, to settle at 104.51 points. This came on the back of the 4.72% weekly drop in each of the price of Bank of Beirut’s preferred shares class “I” and “H” that converged to the same price of $25.25. However, the preferred shares of Byblos class 08 and those of BLOM class 2011 rose by 0.90% and 1.00% to $100.90 and $10.10, respectively.

In the real estate sector, and after Solidere released 2015’s financials revealing a yearly loss, the company’s shares remained below the $10.00 mark. Solidere class “A” lost 0.10% to close at $9.84, while the class “B” added a weekly 0.10% to settle at $9.90.

Within the industrial sector, HOLCIM shares recorded another weekly gain adding 1.19% to $14.47.

On the London Stock Exchange, Audi GDRs added 2.61% to end the week at $5.90, while Solidere GDRs rose 1.42% to $10.00.  In fact, the price of Solidere stock did not reflect the impact of the company’s negative results for 2015. This resulted from the company spreading optimistic expectations after securing deals in 2016 amounting to $158M so far.

Positive vibes from the municipal elections pushed up stock prices during the week. However, the reactions of some political parties on the implementation of the U.S. law that sanctions banks that knowingly deal with Hizbullah may impact the stock market in the coming weeks.

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