Prospects of Cabinet Formation Boost Lebanon’s Bourse

During this week, Lebanon’s Bourse witnessed a vast improvement, where the BLOM Stock Index (BSI) recorded its 5 year high, to stand at 1236.67 points led by the positive performance of the stocks. As such, market capitalization on the Beirut Stock Exchange (BSE) rose from $10.25B to $10.40B this week.

 However, the average traded volume and value on the Lebanese bourse respectively decreased from last week’s 548,733 shares worth $3.23M to 219,818 shares worth $2.40M this week.

When compared to regional indices, the BSI followed the same positive trend as its regional peers. In details, the gauge outperformed the Morgan Stanley (MSCI) Emerging Markets, S&P Pan Arab Composite LargeMidCap, and the S&P AFE40 indices which registered respective weekly rises of 0.57%, 0.55%, and 0.02%.

In the Arab world, higher crude oil prices boosted the TASI, Saudi Arabia’s stock index, which recorded a 2.53% weekly gain. Moreover, the vibes deriving from the interest rate hike and the floating of the currency keep on positively affecting the Egyptian bourse that registered a weekly gain of 1.17%. However, Qatar and Abu Dhabi’s stock indices dropped 0.61% and 0.44%, respectively.

The banking sector, grasping the largest share this week of 64.6% out of the total value traded on the Lebanese Bourse, was the main driver the rise in the BSI. In details, BLOM listed shares and BLOM GDRs recorded respective gains of 0.89% and 1.89% to close at $10.20 and $10.80. Moreover, Audi common shares and Audi GDRs sharply increased by 3.85% and 6.06% to reach $6.75 and $7.00, respectively. Also, Byblos common shares inclined 1.20% to stand at $1.69.

Similarly, the BLOM Preferred Shares Index (BPSI) increased by a weekly 0.04% to 104.96 points. As such, this rise can be attributed to the 0.10% rise in Audi Preferred class “G” that reached $102. Byblos preferred 2008 and Byblos Preferred 2009 increased by 0.10% and 0.49% to $101.30 and $102, respectively. On the other hand, BoB Preferred “J” shares fell 0.95% to $26.

As for the real estate sector, it constituted 35.38% of the total weekly traded value with Solidere A shares increasing by 0.35% to $11.49, while Solidere B shares dropped 0.79% to reach $11.31.

In the manufacturing sector, HOLCIM shares fell 2.45% to $13.53.

On the London Stock Exchange, Audi GDRs and BLOM GDRs observed respective increases of 5.26% and 0.94% to $7.00 and $10.70. Similarly, Solidere GDRs rose by 1.35% to stand at $11.25.

With positive prospects for a cabinet formation in the upcoming weeks, the BSI maintains its upward trend. As such, further political improvement might enhance the gauge, yet any negative events will place the BSI back in the red zone.

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