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Lack of liquidity dominates the market at the end of February 2019

2019-02-28

Sahem Weekly Trading Report (24-28)-02-2019

At the end of February, Al-Quds Index still maintains its increasing -if being slight-, despite the domination of lack of liquidity- if we exclude the institutional transactions- on Palestine Stock Exchange PEX’s trading for a period of time, to close at the level of 541.18 points; up by 0.004% than its previous weekly closing level. However, with the entry of the annual routine price cycles following the financial data disclosures and dividends distribution trends ‘announcements, the investors change their positions of the most active stocks. Despite this, the investors’ appetite is still under the liquidity’s domination. Whereby, it cannot be hidden from the observer that the PEX needs foreign and institutional liquidity with diversified investment targets, to overpass prices and psychological barriers. Where with the witnessed weak increases and decreases of Al-Quds Index for a period of time, it still lacks the direction compass due to the lack in the liquidity momentum

Regarding the listed companies’ dividends distribution announcements for the year 2018, the board of directors BOD of the Arab Islamic Bank AIB raised a recommendation to the general assembly GA, which will be holding a meeting on 26/03/2019, to raise the paid-up capital from $75.00 million to around $84.88 million through distributing 13.17% stocks dividends to its shareholders. Also, it recommended distributing 3.50% cash dividends to its shareholders for the year 2018, to record dividends yield of 1.98% based on the current market price, and payout ratio of 36.84% based on the earnings per share EPS of 2018. Moreover, the BOD of the Vegetable Oil Industries Company VOIC proposed to the GA, which will be holding a meeting on the last half of April 2019, distributing 60% cash dividends for the year 2018, to record dividends yield of 4.14% based on the current market price, and payout ratio of 36.70% based on the EPS of 2018. In the same context, the BOD of Palestine Investment and Development Company PID raised a recommendation to the GA, which will be holding ordinary and extraordinary meetings on 24/03/2019, to distribute 10% cash dividends for the year 2018, to record dividends yield of 6.53% based on the current market price and payout ratio of 76.34% based on the EPS of 2018. In the insurance sector, the BOD of Al-Takaful Palestinian Insurance Company TIC proposed to the GA, which will be holding a meeting on 18/04/2019, distributing 10% cash dividends for the year 2018, to record dividends yield of 4.31% based on the current market price, and 36.10% payout ratio based on the EPS of 2018.

Regarding this week’s trading, Sanad Construction Resources Company SANAD topped the PEX this week when its transactions contributed for 32.53% from the PEX’s total trading value. This followed executing an institutional transaction that exceeded 0.80 million shares on its stocks, to close at the level of $2.08; significantly up by 14.92% than its previous weekly closing level. On the other hand, the stock of the Arab Islamic Bank AIB increased significantly by 8.59% than its previous weekly closing level after trading in a relatively wide range, to record $1.77. This followed transactions that didn’t exceed $0.20 million. In another context, the stock of Bank of Palestine BOP stabilized at $2.30 without any change than its previous weekly closing level. This followed recording trading value worth $1.39 million, in which was supported by executing an institutional transaction of 0.42 million shares through the week.