Middle Eastern Markets

Via Bloomberg, an interesting review of the equity markets in Saudi Arabia, the United Arab Emirates, Kuwait, Qatar, Bahrain and Oman where – as oil revenues spur construction and increase demand – profit growth is projected to exceed other emerging markets around the word. As the article notes:

“… The MSCI GCC Countries Index of the six Gulf Cooperation Council members is 12 percent less expensive than shares in the MSCI Emerging Markets Index, which includes stocks in China and Brazil, according to data compiled by Bloomberg. Benchmark indexes in Saudi Arabia, the U.A.E. and Oman have risen at least 25 percent this quarter.

“…Knerr owns Dubai-based Emaar Properties PJSC, the biggest publicly traded real-estate developer in the Middle East, and Orascom Construction Industries, the region’s largest publicly traded cement maker, located in Cairo.

…Investment restrictions have limited the benefits of booming Arab stocks. The market capitalization of all Middle Eastern shares available to foreigners is about $209 billion, according to Morgan Stanley… In Saudi Arabia, only residents of GCC states can freely trade the country’s stocks, while the U.A.E. limits foreign ownership to 49 percent of a local company’s shares. The restriction in Oman is 70 percent.

…Mobius, who bought Muscat, Oman-based Galfar Engineering & Contracting SAOG after its initial public offering in September, eliminated Emaar from three of the funds he manages last quarter. “…There’s a greater effort to build an industrial base, broaden the economy and build a foundation for the long term, before all the oil reserves run out,” said Dan Chamby, who runs the $41 billion BlackRock Global Allocation Fund in Plainsboro, New Jersey. “There’s immense opportunity.”

His fund, which owns equities, bonds and currencies, bought Islamic bonds convertible to stock in Dana Gas PJSC, a Sharjah, U.A.E.-based natural gas company, and Aldar Properties PJSC, Abu Dhabi’s biggest real-estate business, about six months ago….”

This entry was posted on Tuesday, December 11th, 2007 at 12:41 pm and is filed under Abu Dhabi, Dubai, Dubai World, Egypt, Emaar Properties, Kuwait, Oman, Qatar.  You can follow any responses to this entry through the RSS 2.0 feed.  Both comments and pings are currently closed. 

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Wildcats & Black Sheep is a personal interest blog dedicated to the identification and evaluation of maverick investment opportunities arising in frontier - and, what some may consider to be, “rogue” or “black sheep” - markets around the world.

Focusing primarily on The New Seven Sisters - the largely state owned petroleum companies from the emerging world that have become key players in the oil & gas industry as identified by Carola Hoyos, Chief Energy Correspondent for The Financial Times - but spanning other nascent opportunities around the globe that may hold potential in the years ahead, Wildcats & Black Sheep is a place for the adventurous to contemplate & evaluate the emerging markets of tomorrow.