The BSI Slightly Rose This Week Despite the Failure to Form a New Government

The BLOM Stock Index (BSI) compiled by BLOMInvest Bank on a daily basis slightly rose by 0.08% to

Reach 619.73 by the week ending November 13, 2020. However, the Market capitalization on the Beirut Stock Exchange (BSE) decreased by 0.08% to reach $6.35B on November 13, 2020. Moreover, the average volume and value of trades this week totaled 45,522 shares worth $558,822 traded, compared to 64,321 shares worth $637,288 traded last week.

Regionally, the major Arab markets witnessed a better performance this week. In details, the S&P AFE 40 Index and the S&P Pan Arab Composite Large Mid Cap Index increased by 3.30%, and 3.59% respectively. In addition, the MSCI rose by 1.36%.

In the Arab World, the bourses of Saudi Arabia and UAE were the top gainers increasing by 4.27% and 4.74%, respectively. The good performance on Arab market is attributed to the increase of price of oil worldwide after the big announcement by “Pfizer” and “Biontech” that a vaccine developed by them, is 90% effective in preventing COVID-19 in participants. However, the distribution of the vaccine will have some technical issues and need couple of months to become available for most of people, which set to break the winning run at the end of the week.

On the Beirut Stock Exchange (BSE), Lebanon’s real estate sector grasped the lion’s share of the BSE’s trading value with a stake of 97.19%. The banking sectors and industrial sector grasped the remaining share of 2.62% and 0.17%, respectively. The most noteworthy trades throughout the week included:

• Blom GDR shares dropped by a weekly 13.13% to $2.25/share
• Blom listed shares dropped by a weekly 1.07% to $2.78/share
• Audi GDR shares dropped by a weekly 0.91% to 1.09$/share
• Audi listed shares rose by a weekly 6.80% to $1.10/share
• Byblos shares rose by a weekly 4.35% to $0.48/share
• Bank of Beirut shares dropped by a weekly 5.32% to $17.80/share
• Solidaire (A) shares rose by a weekly 0.13% to $15.82/share
• Solidaire B shares rose by a weekly 0.38% to $15.86/share
• Holcim shares rose by a weekly 0.08% to $13.03/share

As for the BLOM Preferred Shares Index (BPSI), it remained unchanged this week and reached 48.75 points.

On the London Stock Exchange,  Blom GDR shares dropped weekly by 33.33% to reached $0.40 .Meanwhile Audi GDR rose weekly by 15.63% to reach $0.37. It’s worth mentioning the Audi and Blom intends to delist, respectively, from the London stock exchange and Luxembourg stock exchange. The last trading day in London Stock Exchange for Blom GDR, and Audi GDR will be in 24 November, and 16 November, 2020 respectively.

Lebanese stock market is affected by the uncertainty of political and economic situation in Lebanon. Reforms are needed by the potential government in order to reactivate the Lebanese economy. Lebanese stock market should play a major role in Lebanese economy by being a strong competitor to the banking sectors when it comes to raising capital. Moreover, The CMA, with the cooperation of BDL, should work to develop the stock market in Lebanon by encouraging new companies to enter the market. However, with the low expectation to form a new government any time soon, our outlook for the Lebanese market will remain negative.