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Al-Quds Index in the red zone amid scarcity in trading

2018-05-24

Sahem Weekly Trading Report (20-24)-05-2018

Al-Quds Index declined again this week by 0.17% than its previous weekly closing level, to record 541.25 points. This followed a lack of purchasing bids momentum around the levels witnessed by some stocks in the previous period. However and despite executing some institutional transactions from time to time, the trading in Palestine Stock Exchange PEX has been scarce, weak and lacked the price trending for a period of time, parallel to entering expected routine periods due to the dividends distribution or financial data disclosures or the start of the holy month of Ramadan.

Regarding the significant news for this week, the governor of Palestine Monetary Authority PMA noted-in implementation to the decision of the PMA’s board of directors and requirements of the banking laws in particular- forming high authority of “Shariah Supervisory Board”, which comes under the PMA’s constant seeking to develop the Islamic banking system in accordance to the international best practices and standards issued by the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI). Whereby, this Supervisory Board will consolidate the foundations of legitimacy related to banking and financial formulas and Islamic finance instruments, review the Shariah contracts formats in order to implement them and determine their needed procedures, and provide legal opinions of the compatibility of the new Islamic banking and financial services which banks and specialized lending institutions want to introduce with provisions of Islamic Shariah .

Regarding the listed companies’ significant news for this week, Ahliea Insurance Group AIG disclosed its financial statements for Q1 2018 after the end of the legal period granted by the PEX to the listed companies to disclose their quarterly data. Whereby, the disclosed data showed posting net income attributable to the shareholders of the parent company of $0.79 million in Q1 2018, compared to $0.30 million in the corresponding period of 2017. This mainly resulted from an increase in the insurance activities revenues, in addition to posting gains from foreign exchange currencies differences compared to reporting losses from foreign exchange currencies differences in the corresponding period of 2017. Accordingly, AIG records book value BV of $2.16 and P/BV of 0.13x. While with adding AIG’s disclosed date to the other disclosed data of the insurance companies’ sector, the insurance sector records average PE ratio of 4.64x and average P/BV of 0.89x.