finance & economy

MSX ends in red led by financial sector

May 30, 2021

The MSX30 index ended the week lower by 0.94 per cent. All sub-indices ended in red. Industrial sector ended down 0.40 per cent while services sector and financial sector closed down by 0.17 per cent and 0.81 per cent respectively. MSX Shariah Index declined by 0.48 per cent. Foreign investors were net sellers during the week.

UK-based infrastructure management firm Helios Towers has pledged to build at least 300 telecom towers around Oman as part of a landmark long-term master services agreement reached with Omantel, the majority state-owned telecom services provider of the Sultanate.

This was revealed by Chief Executive Officer of Omantel, at a virtual session with investors hosted by Muscat Securities Exchange (MSX). Detailing the schematics of the agreement, CEO said Omantel will sell 2,890 towers in the Sultanate to Helios Towers for a cash consideration of $575 million, an amount which has made the transaction among the highest in valuation in the emerging markets in recent years.

National Finance has announced that subsequent to the CEO resignation, the ex-CEO, Shahin Mohammed al Balushi filed a legal (labour Case) action claiming compensation. The primary court issued a judgment on January 6, 2021 ordering the company to pay RO 36k. The ex-CEO appealed, and the appeal court issued a judgment on May 19, 2021 ordering the company to pay an amount of RO 840k.

National Finance intends to challenge the judgment before the supreme court as it strongly believes that the judgment of the appeal court did not reflect the law, the internal policies and the contractual arrangements between the parties.

Oman inflation rate which remained in negative territory for more than year has turned positive, reflecting the increase in prices of certain items after the implementation of VAT. The inflation rate in the Sultanate increased by 1.59 per cent in April 2021 compared to the same month of 2020, according to data from the National Centre for Statistics and information (NCSI).

The inflation rate during April 2021 also rose by 1.47 per cent compared to March 2021. The increase of prices in April 2021 is attributed to the rise of prices in main groups, such as the transportation group by 6.46 per cent, tobacco by 4.07 per cent, miscellaneous goods and services by 3.18 per cent, recreation and culture by 1.94 per cent, furnishings, household equipment and routine household maintenance by 1.26 per cent, food and non-alcoholic beverages by 0.29 per cent, clothing and footwear by 0.15 per cent, education by 0.08 per cent, housing, water, electricity, gas and other fuels group by 0.07 per cent, and health by 0.06 per cent.

Global credit ratings agency Capital Intelligence (CI) Ratings announced that it has affirmed the long-term and short-term foreign currency ratings of Bank Muscat, National Bank of Oman (NBO) and Oman Arab Bank (OAB). CI Ratings has also affirmed the long-term and shortterm ratings of Alizz Islamic Bank on Oman national scale. CI Ratings has affirmed the long-term foreign currency rating and short-term foreign currency rating of Bank Muscat at ‘BB’ and ‘B’, respectively.

The ratings agency kept its outlook on Bank Muscat negative, according to the statement issued by the agency. At the same time, CI Ratings has affirmed Bank Muscat’s bank standalone rating of ‘bb’, core financial strength rating of ‘bbb’ and extraordinary support level of ‘moderate’.

For NBO, CI Ratings has affirmed the long-term foreign currency rating and short-term foreign currency rating of the bank at ‘BB’ and ‘B’, respectively. At the same time, CI Ratings has affirmed NBO’s bank standalone rating of ‘bb’, core financial strength rating of ‘bbb-’ and extraordinary support level of ‘moderate’.

CI Ratings has also affirmed the long-term foreign currency rating and short-term foreign currency rating of OAB at ‘BB’ and ‘B’, respectively. The ratings agency has affirmed OAB’s bank standalone rating of ‘bb’, core financial strength rating of ‘bbb’ and extraordinary support level of ‘moderate’. Additionally, CI Ratings affirmed Alizz Islamic Bank’s ratings and kept outlook negative.

It has affirmed Alizz Islamic Bank’s long-term and short-term ratings on the Oman national scale at ‘omAA’ and ‘omA1+’, respectively. The outlook on Alizz Islamic Bank’s ratings remains negative, in line with the outlook assigned to Oman’s sovereign ratings, CI Ratings said.

omanobserver

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