Nablus stock market concerned over delayed telecom deal
Hold-up in deal that would see Kuwait's Zain Telecom take major stake in Palestinian operator PalTel has negative effect on Al-Quds Index
The Palestinian Stock Exchange in Nablus ended Sunday's trading with a slight rise of 0.44%. The Al-Quds Index reached 534.29 points, marking a 2.34% increase from its previous trading day (Thursday).
While the increase is minor, it is still an improvement from last week's trend, in which the index dropped 2.7%. Should this positive trend continue, it will be considered a significant event in the Palestinian economy.
The continued climb of the Al-Quds Index will prove that Palestinian investors have acknowledged the new political reality and the induction of Israeli Prime Minister Benjamin Netanyahu's government. More importantly, such a positive trend would indicate that the investors believe a major communications deal in the Palestinian Authority is closer than ever. Should the deal fall through, the index is expected to tumble to levels lower than those recorded following last week's announcement that the Hamas- Fatah reconciliation talks in Cairo have failed, again.
As of now, the delay in the deal, which would see Kuwait's Mobile Telecommunications Co (Zain) to take a major stake in Palestinian operator Palestine Telecommunication Company (PalTel), is having a significant effect on trading. At this point it seems that some of the regulatory issues related to the deal have yet to be resolved, and last week's unsuccessful talks between Zain execs and Palestinian Prime Minister Salam Fayyad have also contributed to the drop in the Al-Quds Index during the first half of the week.
PalTel is one of the most important stocks in the Nablus stock market.
Last week's negative trend was not limited to the services sector. Apart from banking sector companies, which saw an overall rise of 1.95% in their value, the rest of the sectors, including the investment (-4.29%) and industrial (-2.5%) sectors, all decreased in value.
Sunday's trade volume at the Palestinian stock market was relatively low and totaled just over $1 million. Some 258,500 stocks were traded in 294 deals.
Dr. Gil Feiler is founder and managing director of Info-Prod Research (Middle East) Ltd , and Doron Peskin is head of research
