| ||17/12/2021||10/12/2021||% Change|
|BLOM Stock Index|| 984.442|| 946.031||4.06%|
|Average Traded Volume|| 90,648|| 56,737||59.77%|
|Average Traded Value|| 1,581,574|| 937,131||68.77%|
This week, the BLOM Stock Index (BSI) compiled by BLOMInvest Bank on a daily basis increased by 4.06 % reaching 984.442 on December 17, 2021. The Market capitalization on the Beirut Stock Exchange (BSE) witnessed an increase from $9.69B to $10.09B. The average volume and value of trades also totaled 90,648 shares worth $1,581,574 compared to 56,737 shares worth $937,131 last week.
This week, another circular was issued by BDL that allows commercial banks to sell US dollars to the public. BDL will provide banks with cash US dollars instead of Lebanese lira for their remaining quota of this month’s liquidity. As a result, Lebanese lira has dropped to LBP/USD to 26,000 after hitting LBP/USD 28,000 earlier this week. However, we don’t believe that this is can be a permanent solution to save the national currency, as the government should speed up the negotiations with the IMF in order to adopt a rescue plan that would reflect some stability on the market which will have positive effect of the Lebanese lira.
Regionally, the major Arab markets witnessed a better performance this week. The S&P AFE 40, the S&P Pan Arab, increased weekly by 1.13%, and 2.01%, respectively, while MSCI decreased by 1.91% compared to last week. Moreover, in the Arab World, the bourse of KSA and UAE were the top gainers this week, and witnessed an increase by 3.41%, and 1.45%, respectively. Meanwhile, least gainer was Kuwait with a drop of 1.09% for this week.
On the Beirut Stock Exchange (BSE), the real estate sector grasped the lion’s share of the BSE’s trading value with a stake of 93.45%, while banking and the industrial sectors grasped the rest with stakes of 6.15% and 0.40%, respectively. The most noteworthy trades throughout the mentioned period included:
- Solidere (A) shares jumped by 10.21% to $30/share
- Solidere (B) shares surged by 11.03% to $29.80/share
- HOLCIM increased by 1.27% to $20/share
- BLOM (GDR) slumped by 10.26% to $3.50/share
- Audi (GDR) decreased by 11.11% to $2/share
- Audi went down by 17% to $2.30/share
- Byblos decreased by 3.57% to $0.81/share
As for the BLOM Preferred Shares Index (BPSI), it remains the same at 44.99 by the end of this week.
This week, the BSE showed a remarkable increase backed by a strong rebound in the prices of Solidere’s shares. In more details, Solidere A and Solidere soared by 10.21% and 11.03%, respectively. To understand more the fluctuation of this stock, we should observe the evolution of Lebanese lira in the parallel market, while taking into consideration the interventions that are made by BDL that have a certain influence on the black market rate. In details, last week BDL issued the circular 601 that increase the “lollar” rate from LBP/USD 3,900 to LBP /USD 8,000. As a result, investors have shorted Solidere stock in order to most likely benefit from the updated “lollar” rate. However, the circular 601 was negatively received by the parallel market as the national currency has slumped against the dollar and reached LBP/USD 28,000. In consequence, the further depreciation of Lebanese lira has likely reversed the reactions of investors to long Solidere which increased its price by the end of this week.