Ahli Investment Banking ASE Technical Analysis & Investment Patterns Report December 2 nd, 2008 This report is intended to provide an overview on the technical performance of the ASE general index. The report also keeps track of the investment patterns as they prevail in accordance to the trading activites associated with the various nationality groups active in the ASE. Ahli Investment Banking Basel Khraisheh E-mail: baselk@ahlibank.com.jo Tel.: 5689861/2/ 5689857 Research & Financial Analysis Rabe Al-Bataineh E-mail: researchunit@ahlibank.com.jo Tel.: 5689854 Murad Hijazeen E-mail: murad.hjazeen@ahlibank.com.jo Corporate Finance E-mail: mhejab@ahlibank.com.jo Ahli Brokerage Company E-mail: brokerage@ahlinabk.com.jo
Periodic Market Report Amman Stock Exchange (ASE) December 2 nd, 2008 ---------------------------------------------------------------------------------------------------------------------------- Technical Analysis : Upward RSI: Relative Strength Index MFI: Money Flow Index : Downward MACD: Moving Average Convergence Divergence SMA: Simple Moving Average : Indecision RSI Technical Leading Indicators MACD MACD Signal Line MACD Divergence MFI Technical Lagging Indicators SMA - 5 days SMA - 10 days SMA - 20 days SMA - 50 days The changes in the above technical indicators show the change as of November 30th 2008, compared to October 30th 2007. Market Technical Overview The technical perspective on the general index is still in favor of the downward trend despite the recent rally heading upward in the last few days. This is largely based on the observation that the recent rally is largely contained within the downward channel characterized by the peak and trough progression and the fact that the index has at least for the past four months continued to record lower highs and lower lows. In retrospective, the index has broken the trend line for its major upward trend sometime during August of this year. This major trend can be traced back to September of last year. As such, the initial signals of a waning upward momentum were first evident in July and early August, particularly, as the index failed to reach higher highs. The index then entered into sideway trading before it penetrated its trend line heading downward, thus confirming that the major upward trend that lasted for 12 months has in fact ended. As there are 15 more trading sessions separating the Amman Bourse from the end of 2008, the general index has so far failed to breakout from its intermediate downward trend as it continues to break support levels every time it retraces downward for a retest. In fact, support levels have turned into resistance barriers clearly identified according to Fibonacci Retracement levels. For the coming period, traders will be on the lookout for a possible break of the major trend lines shaping the downward rally, as the new level at 2550 is very likely to be retested again. The ability for the latter level to hold might signal a fading downward momentum, while failure to hold signals a downward continuation pattern. On the upside, a break of the level at around 2900 is needed to shift into a more optimistic perspective.
Periodic Market Report Amman Stock Exchange (ASE) December 2 nd, 2008 ---------------------------------------------------------------------------------------------------------------------- Investment Patterns Investment Patterns by Nationality (November) 2008 Nationality Sell Buy Securities Market Value JD Securities Market Value JD Net Investment JD (Market Value) Banking Sector Jordanian 18,528,187 107,592,348 23,392,874 174,336,380 66,744,032 Arab 7,709,068 89,969,113 3,492,322 37,437,745-52,531,368 Foreign 1,501,786 19,822,249 853,845 5,609,586-14,212,663 Total Banking 27,739,041 217,383,710 27,739,041 217,383,710 Insurance Sector Jordanian 9,616,094 26,151,788 10,107,052 27,563,901 1,412,112 Arab 4,628,856 17,638,379 3,919,189 15,807,620-1,830,759 Foreign 75,650 319,296 294,359 737,942 418,647 Total Insurance 14,320,600 44,109,463 14,320,600 44,109,463 Services Sector Jordanian 168,603,760 312,750,939 170,054,842 305,309,885-7,441,054 Arab 26,125,692 70,473,672 27,256,363 83,418,424 12,944,752 Foreign 4,412,595 9,087,330 1,830,842 3,583,632-5,503,698 Total Services 199,142,047 392,311,941 199,142,047 392,311,941 Industry Sector Jordanian 55,678,528 159,549,588 55,605,556 170,496,715 10,947,127 Arab 8,518,029 26,817,946 9,170,496 29,379,340 2,561,394 Foreign 1,339,236 21,890,767 759,741 8,382,247-13,508,521 Total Industry 65,535,793 208,258,302 65,535,793 208,258,302 All Sectors Jordanian 252,426,569 606,044,663 259,160,324 677,706,880 71,662,217 Arab 46,981,645 204,899,110 43,838,370 166,043,129-38,855,981 Foreign 7,329,267 51,119,643 3,738,787 18,313,407-32,806,236 Grand Total 306,737,481 862,063,416 306,737,481 862,063,416 ASE Investment Patterns as presented by the Securities Depositary Center (SDC) : (November) 2008: Jordanian net investments in the ASE recorded positive figures as it stood at JD71.6 million during November 2008. On the other hand, net investment by Arab and Foreign traders dipped into negative territories as they recorded JD (38.8) million and JD (32.8) million, during the same period, respectively. Trading activities by Jordanians contributed to the largest stake of total trading during November 2008 standing at 74.46%, while Arabs and Foreigners' contribution were recorded at 21.51% and 4.03%, respectively. When expressing net investment relative to stock purchase value, Jordanian traders seem to have kept 10.57% of their stock purchase value during November 2008, while to the contrary, Arab and foreign traders have sold 23.4% and 179.14% more in stock value compared to their stock purchase value, respectively, during the same period.
Periodic Market Report Amman Stock Exchange (ASE) December 2 nd, 2008 ---------------------------------------------------------------------------------------------------------------------- Net Investment by Nationality Type 80 November 2008 10.57% 50% 60 40 71.7 0% JD Millions 20 0-20 -40-60 -23.40% Jordanian Arab Foreign -38.9-32.8 Net Investment -179.14% Net Investment / Stock Purchase Value -50% -100% -150% -200% Investment Patterns Analysis (November) 2008 For the purpose of this report, investment patterns within the context of the ASE are associated with the nationality type of the main three investor categories; namely, Jordanians, Arabs and Foreigners. Jordanian traders have contributed to almost 74.46% of the total trading value during November which is around the average during the past couple of months, compared to only 21.5% and 4% share attributed to Arab and foreign traders, respectively. However, in terms of net investments associated with each investor category, we notice that foreign investors have recorded negative figures standing at JD(32.8) million, as the value of their stock purchases was recorded at JD18.3 million, while they have sold stocks valued at JD51.1 million during the same period. As such, foreign traders have sold 179% more in stock value relative to their stock purchases. Likewise, Arab traders have sold 23.4% more in stock value relative to the value of their stock purchases; as their net investment dipped to a negative JD38.8 million during November. As for Jordanian traders, they have kept around 10.6% of their stock purchases of JD677.7 million, thus bringing their net investments to JD71.6 million during the entire month of November. This development is consistent, to some extent, with October's statistics. That is, net investment by Jordanian traders recorded positive figures for the first time in 2008 only in October and again in November. This comes at a time when foreign traders have intensified their selling pressures amid the unfolding of the global financial crisis. Such a development may be expressed as an indication that Jordanian traders or segments of Jordanian traders have built or rebuilt new positions taking advantage of the very low price levels at the ASE, while foreign and Arab traders continue to liquidate their positions, while judgment on the efficiency of such activities will become clearer in the coming period. It remains, however, that net investments associated to each nationality type represent the aggregate net investments during the entire month as opposed to net investments on daily or weekly basis. Therefore, net investments may very well fluctuate on daily basis; however, the analysis presented above relies entirely on net investments by the end of the month under study.
Disclaimer: The trading and financial related data contained in this market technical report for Amman Stock Exchange (ASE) has been obtained from sources considered by Jordan Ahli Bank to be reliable in all material respects. However, the accuracy, fairness and completeness thereof are not guaranteed by Jordan Ahli Bank and its third-party suppliers shall have no liability for errors or omissions with respect to the service or its delivery, regardless of the cause or source of such error or omission. This is not an invitation to buy or sell stocks traded in Amman Stock Exchange. The Purpose of this report is to provide information and analysis related to Amman Stock Exchange and assists investors to obtain information to support their decisions. The reader should not make any investment decision solely based on the information contained in this report and she/he should consult with her/his investment advisor before investing. In addition, technical review included in this report may not suit intra-day traders since closing prices form the base of the analysis and not real-time or intraday market quotations. This report is a copyright of The Jordan Ahli Bank and should not be reproduced or redistributed partially or fully in away shape or manner without the express written consent of the Jordan Ahli Bank.