King Canute
Yesterday, the Minister of Commerce and Industry, HE , commanded the pension funds to support the market, which they dutifully did, helping boost the market to a 2% gain as everyone sold around them(or as the always predictable Times of Oman put it, finally daring to talk about the market "MSM-30 surges 1.92pc to close at 9002 points").
Today, the MSM returned to its recent form and dropped back to 8834.78, just about where it ended on Thursday before the pension fund managers got their talking to, although if you ask me it looked like they were active in the later part of the session to minimise the loss and keep it above a record low for 2008, which is where it was from 11-12pm. There was also no pause whatsoever as the index sailed past the previous low, another worry for those who want a return to the good old days.
I'm curious to see who comes out next to try their hand at holding up the market...
Those who tried yesterday morning probably ended up with a 3-5% net trading loss (at least on paper) in less than 36 hours.
Watch this space. Oh, and look at how the papers respond too. Expect more stories on the impressive drops in other regional markets [ie: it's not just us, it's happening everywhere], and calls for controls on foreigners selling out [ie: there's nothing wrong with the Omani companies, it's the fault of these speculating foreigners]...
The fall probably reflects the fall in oil prices and is reflected in other bourses of GCC. GCC stock markets lack depth are dominated by banks, which make super profits on personal loans. There are no major players in manufacturing sector and major part of the economy i.e oil and gas sector owned by Government is not listed in the market.
ReplyDeleteMost of the new industry startups are not tapping the stock market and prefer bank loans. This being the case MSM movement does not create news or excite any body.
well there is no surprise , in the sense ..the way the companies PE are quoted..all of them are overvalued....
ReplyDeletei felt many are over optimistic....no way voltamp shud have touched 1.500 which is almost PE 50 of 2009?
now a realistic position is happenning...