200th edition of "the Lebanon Brief"
graph & table BLOM index
This edition of “The Lebanon Brief”is the 200th ,the first having been published just a few weeks following the re-opening of the Beirut Stock Exchange (BSE)at the start of 1996.Three companies were listed at the re-opening –Ciments Libanais,Ciments Blancs and Eternit,while Solidere did not switch from the so-called Beirut Secondary Market to the BSE until October 1996. Keeping track of the listed stocks since the beginning has been the BLOM Stock Index (BSI),Lebanon’s first financial markets index, which at the start of trading encompassed the BSE stocks and Solidere and had a base level of 1,000.Now,the BSI stands at 631.36,some 37'elow its base. This, to a large extent, is expressive of the fortunes of the BSE during the last four-and-a-half years. Although 13 companies are now listed on the BSE, certainly fewer than would have been expected in January 1996,activity has diminished considerably with stock market turnover (trading value / market cap.) plunging from a peak of 23.84%in 1997 to 4.57%only two years later in 1999.
Of course, the period since the re-opening of the BSE has been characterized by quite a deep recession in Lebanon, which has naturally hit the corporate sector quite hard, at the heart of which lies a persistent budget deficit and growing level of public debt.
tab banking sectorNot forgetting the events of this week in the equity market, volume on the BSE was a relatively normal if lowly 128,629,given that we are in the midst of the summer season.Byblos “C”was the main mover among banks,dropping almost 10%on Tuesday before recovering to $1.875 at the close,just 3.30own on the week.Bank of Beirut “C”saw volume of 21,221 but yet again was unmoved, while Audi “C”recorded trade of 500 shares.BEMO was also subject to some trade,totalling 15,873.Bank GDRs were all down,with Audi leading the way as it shed 3.9%to hit $19.18 while BLOM was only 1.1%lower at $22.5.
Solidere had a quiet week,with the “A”share witnessing volume of only 2,400 as it slipped 1.7%to $7.375 and class “B”losing 1.6%to reach $7.75 on turnover of 7,325.The stock is likely still feeling the after-effects of the news that Saudi Prince Al-Waleed bin Talal is considering putting a halt to the planned $250m Four Seasons Hotel development.Apparently citing the current economic depression and government hold-ups of construction permits in the central district, the move –if carried through -doesn’t bode well for other projects in the downtown area.Solidere’s GDR was down 4.4%at $5.4.
Ciments Libanais and Ciments Blancs “B”were the only other stocks traded,but with sharply contrasting volumes,50,000 for the former and 14 for the latter,as prices were unchanged.
© 2000 Mena Report (www.menareport.com)