Gulf stock listings nosedive in 2016: Report

Gulf companies looking to issue IPOs decided to put them off due to events including Brexit, the US presidential election and volatility on oil markets up until the Organization of the Petroleum Exporting Countries (OPEC) agreed to cut production. (Reuters)
Updated 04 January 2017
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Gulf stock listings nosedive in 2016: Report

KUWAIT CITY: Stock markets in the energy-rich Gulf saw a sharp drop in the number of initial public offerings in 2016, as well as the value of listings, a report said Wednesday.
Only three IPOs (Initial Public Offerings) were made in the region last year, half the number recorded in 2015 and the lowest in 15 years, Kuwaiti investment firm KAMCO Research said in the report.
Their value was a meager $745 million, the lowest since 2013 and way below the record $10.9 billion raised by stock flotation in 2008 and 2014 separately, KAMCO said.
All three of last year’s IPOs were from Saudi Arabia.
There were none in the remaining members of the Gulf Cooperation Council (GCC) — Bahrain, Kuwait, Oman, Qatar and United Arab Emirates (UAE).
KAMCO said Gulf companies looking to issue IPOs decided to put them off due to events including Brexit, the US presidential election and volatility on oil markets up until the Organization of the Petroleum Exporting Countries (OPEC) agreed to cut production.
Oil producers agreed in late 2016 to cut crude output by 1.8 million barrels a day to shore up weak prices.
The agreement took effect at the start of January.
Companies were also deterred by extreme turbulence on GCC stock markets in the first 10 months of last year before they rebounded in the final two months as oil prices advanced.
Gulf companies were likely to wait until encouraging economic data starts to appear before they enter the IPO market with full force, KAMCO said.


Germany: US calling European cars a threat is ‘frightening’

Updated 16 February 2019
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Germany: US calling European cars a threat is ‘frightening’

  • ‘If these cars ... suddenly spell a threat to US national security, then that is frightening to us’

MUNICH, Germany: German Chancellor Angela Merkel on Saturday labelled as “frightening” tough US trade rhetoric planning to declare European car imports a national security threat.

“If these cars... suddenly spell a threat to US national security, then that is frightening to us,” she said.

Merkel pointed out that the biggest car plant of German luxury brand BMW was not in Bavaria but in South Carolina, from where it exports vehicles to China.

“All I can say is it would be good if we could resume proper talks with one another,” she said at the Munich Security Conference.

“Then we will find a solution.”

A US Commerce Department report has concluded that auto imports threaten national security, setting the stage for possible tariffs by the White House, two people familiar with the matter said Thursday.

The investigation, ordered by President Donald Trump in May, is “positive” with respect to the central question of whether the imports “impair” US national security, said a European auto industry source.

“It’s going to say that auto imports are a threat to national security,” said an official with another auto company.

The report, which is expected to be delivered to the White House by a Sunday deadline, has been seen as a major risk for foreign automakers.

Trump has threatened to slap 25 percent duties on European autos, especially targeting Germany, which he says has harmed the American car industry.

After receiving the report, the US president will have 90 days to decide whether to move ahead with tariffs.

Trump in July reached a trade truce with European Commission President Jean-Claude Juncker, with the two pledging no new tariffs while the negotiations continued.

Brussels has already drawn up a list of €20 billion ($22.6 billion) in US exports for retaliatory tariffs should Washington press ahead, the commission’s Director-General for Trade Jean-Luc Demarty told the European Parliament last month.

The White House has used the national security argument — saying that undermining the American manufacturing base impairs military readiness, among other claims — to impose steep tariffs on steel and aluminum imports, drawing instant retaliation from the EU, Canada, Mexico and China.

Trading partners have sometimes reacted with outrage at the suggestion their exports posed a threat to US national security.