Arab Markets Shined this week amid Increase in Oil Prices

 4/3/202225/2/2022% Change
BLOM Stock Index         959.559          957.3670.23%
Average Traded Volume           61,865          106,625-41.98%
Average Traded Value      1,613,207          277,097482.18%

This week, the BLOM Stock Index (BSI) compiled by BLOMInvest Bank on a daily basis slightly increased by 0.23% to reach 959.559 on March 04, 2022. The Market capitalization on the Beirut Stock Exchange (BSE) increased from $9.76B to $9.90B. The average volume and value of trades also totaled 61,865 shares worth $1,613,207 compared to 106,625 shares worth $277,097 last week.

The Lebanese food security is in dangerous amid wheat shortage due to the war between Russia and Ukraine. In details, Lebanon imports the bulk of its wheat needs from Ukraine. As such, the Lebanese government should act efficiently in order to find a good alternative to the Ukrainian Wheats. Adding to that, the war in Ukraine will certainly erode further Lebanese purchasing power, as the price of crude oil has exceeded the barrier of $100/barrel by the end of this week.

Regionally, Arab markets have benefited from the war in Europe between Russia and Ukraine and recorded a very good performance this week, amid the massive increase in oil prices. The S&P Pan Arab, S&P AFE 40 index and the MSCI index increased all by 4.60% and 5.86%, and 1.53% respectively. Moreover, the bourse in Qatar, UAE, Kuwait, and KSA did very well this week, as all of these countries have benefited from the high price of oil and gas due to the international tensions. The sustainability is the key here, as Arab markets cannot rely on such event to increase their profitability, but they may benefit from this unexpected profit in order to build a more diversified economy.

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 99.32%, while banking sector grasped the rest with stakes of 0.68%. The most noteworthy trades throughout the mentioned period included:

  • Solidere (A) shares increased by 0.96% to $30.54/share
  • Solidere (B) shares increased by 2.32% to $30.87/share
  • Audi (GDR) decreased by 4.64% to $1.81/share
  • Byblos listed increased by 2.47% to $0.83/share

As for the BLOM Preferred Shares Index (BPSI), it remains the same at 44.99 by the end of this week.

The steady exchange rate on the black market due the intervention of BDL through the circular 161 is reflecting

 on Solidere stock performance. As we notice that Solidere (A) and Solidere (B) are not witnessing any major fluctuations on its prices with an exchange rate on that is stable at LBP/USD 20,500 on the black market. The arbitrage between Solidere stock and the national currency have eased in the BSE. However, investors must be aware that as soon as BDL stops interfering in the FX market, the Solidere stock will probably go up.

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