Capital Markets

Can Robot Advisors Succeed in the GCC?

This new breed of investment advisory services currently has close to $100 Bn of Assets under Management (AUMs) in the US market which has a size of close to $30 Tn. At its current adoption rate, Deloitte predicts that robo-advisory services could be managing $5Tn - $7Tn by 2025. Big brands like Charles Schwab, Morgan Stanley, Bank of America Merrill Lynch etc. have jumped in the race to offer such services to their clients which is expected to largely increase...

Qatar Stock Market Outlook 2016

Price-to-earnings multiple for Qatar has fallen by 25% and currently stands at 11.1x. Qatar market is relatively undervalued when compared to the markets of Saudi Arabia and Kuwait. Investor interest in the market waned post 2014 owing to poor international conditions. Qatar also has the highest dividend yield in the region at 5.1%. We expect corporate earnings growth to be slightly negative in 2016. Earnings are expected to slightly reduce as infrastructure spending peaks. Real estate and commodities sector in...

UAE Stock Market Outlook 2016

Valuation: Positive  Price-to-earnings multiple for UAE fell by 13% in 2015 and currently stands at 10.4x. The fall has been the most in Dubai index, wherein, the P/E multiple contracted by 25% from 12.4x at the start of year to a current value of 9.3x. UAE markets seem attractive for investors with P/E ratio of 10.4 while its comparable peers Kuwait and Saudi Arabia are slightly overvalued at 14.4 and 13 respectively. On P/B basis, UAE (1.3) is slightly overvalued...

KSA Stock Market Outlook 2016

Majority of the sectors underperformed during 2015, with Media & Publication, Transport, Energy and Utilities and Real Estate being the exceptions. According to Marmore’s KSA stock market outlook 2016, Saudi construction and cement were the worst hit sectors as they lost 34% and 30% respectively. The decline in banking sector index by 14.9% during 2015 establishes the challenges in the form of liquidity tightening, as a consequence of low oil prices and increased government borrowings that will impact the banking...

MENA Markets end 2015 in Red

  For the year 2015, Egypt declined 24%, due to faltering reforms and forex shortage, while Tadawul’s TASI index declined 17%. All MENA indices ended in red for the year 2015, with most witnessing double digit declines. Oil price fall, regional and global political developments, the recent Fed hike, and Eurozone woes were the much spoken themes for the year. S&P GCC declined 2.4% in December, making it a cumulative decline of 17.4% for 2015. MENA markets liquidity continued its...

GCC Private Equity – Still in its infancy

In the GCC, private equity is still at a nascent stage, but had witnessed significant growth between 2002 and 2008. But the onset of global financial crisis stalled growth of the industry. Fundraising had become anemic, despite the sizeable amount of dry powder accumulated over the boom years, and deals had stalled as acquisition finance became expensive and difficult to obtain.   Most PE funds in the GCC region have broad sector focus with investments ranging from healthcare to ICT,...

Top 20 GCC Mutual Funds 2015

GCC markets are yet to recover following their retreat amid weaker oil prices. Saudi Arabia stocks were affected the most on concerns of deteriorating fiscal position and sustainability of finances. Saudi Index (TASI) declined by 16.6% YTD registering the highest loss among all GCC markets. The Dubai general index registered a loss of 14.6% as investors booked profits amid low international investor participation. Tepid earnings, negative investor sentiments following China crisis and impending U.S Fed hike continue to drag down...

UAE Asset Management Industry – An Overview

According to Marmore’s UAE Asset Management report, the UAE asset management industry manages USD 1,264.8mn in assets in about 31 funds as of 21st July, 2015. In terms of products, equity funds lead the pack with 69% share, followed by specialized funds at 20%. Remainder of the assets is spread across money market and fixed income funds. Of the total assets, Islamic funds manage USD 435mn (34.4%) in assets and rest is conventional funds. In terms of the number of funds,...