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Kuwait Financial Centre “Markaz” GCC Daily Fixed Income Report – 30 July 2012 News Update Select GCC Bond and Sukuk Prices (29 July 2012) Inflation in Kuwait up 2.8% in June- Data of the Central Statistical Type Name Maturity Size (Mn) Rating Office (CSO) have shown an increase rate of inflation in Kuwait by 2.8 Bond State of Qatar 9-Apr-14 2,000 AA/Aa2 percent last June compared with the same month in 2011. A CSO Bond State of Qatar 9-Apr-19 1,000 AA/Aa2 statement said that the annual index increased from 147.7 points then to Bond Emirate of Abu Dhabi 8-Apr-14 1,500 AA/Aa2 151.8 points, while the inflation rate increased by 0.2 percent last June Bond Emirate of Abu Dhabi 8-Apr-19 1,500 AA/Aa2 Bond Mubadala Development Co. 6-May-14 1,250 Aa3/Aa2 compared to last May (on a monthly basis). The Office said in its monthly Bond Mubadala Development Co. 6-May-19 500 Aa3/Aa2 bulletin for records of consumer prices for June that the general index of Bond Qatar Telecom 10-Jun-14 900 A/A2 consumer prices last June rose by 0.2 percent compared to last May after it Bond Qatar Telecom 10-Jun-19 600 A/A2 witnessed a decline in the previous two months. Mumtalakat May Set Up 3 Billion-Ringgit Sukuk Program- Bahrain Mumtalakat Holding Co. BSC, the country’s sovereign wealth fund, may set up a 3 billion- ringgit ($952 million) Islamic bond program, RAM Ratings Services Bhd. said. The proposed Murabahah program was assigned a AA2 rating with stable outlook, according to an e-mailed statement from the Kuala Lumpur-based rating company. Mumtalakat raised $750 million from the sale of bonds in 2010. The yield on the 5 percent notes maturing June 2015 has fallen 123 basis points this year to 4.5 percent on July 27 DP World Yields Climb as Europe Concern Deepens - DP World Ltd.’s Islamic bonds fell last week for the first time since May on renewed concern that Europe’s debt crisis will stunt global growth, denting the outlook for the operator of ports from China to Russia and Peru. The yield on the 6.25 percent sukuk due July 2017 surged 14 basis points last week to 4.32 percent, the biggest five-day gain since the week ended May 18. That compares with a three basis-point increase to 3.71 percent in the average yield on corporate sukuk in the six-nation Gulf Cooperation Council, the HSBC/NASDAQ Dubai GCC Corporate US Dollar Sukuk Index shows. HSBC Sees Record Saudi Bond Sales as Spending Jumps- Saudi Arabia’s record local-currency bond sales by companies this year will be buoyed as a jump in government spending boosts jobs and growth, according to HSBC Holdings Plc. Issuers in the world’s top oil exporter have sold $8 billion in Islamic bonds this year, more than any Arab country and a third more than second-ranked Qatar. Of these, 67 percent were denominated in riyals, including a 15 billion-riyal ($4 billion) sale of the General Authority of Civil Aviation to fund an airport in Jeddah. Islamic exchanged-traded funds struggle on lack of optionsIslamic exchange-traded funds (ETFs) are struggling to attract fresh investors, in contrast to a move by Western investors into conventional ETFs - a difference due to the Gulf's plain-vanilla investment culture and the way in which institutions choose financial products. Plain vanilla is the most basic or standard version of a financial instrument, usually options, bonds, futures and swaps.

Sukuk Aldar Properties Sukuk DP World Ltd

27-May-14 2-Jul-17

1,500 1,500

Bid Price 106.257 124.417 107.469 125.890 107.407 128.327 108.915 127.890 BB-/B1 109.316 BBB-/Baa3 109.962

Ask Price 106.736 125.167 107.888 126.613 107.967 129.333 109.575 129.088 109.963 109.589

Bid Yield 1.451% 2.569% 1.054% 2.524% 1.510% 2.977% 1.643% 3.304% 5.346% 4.218%

Ask Yield 1.180% 2.462% 0.817% 2.422% 1.205% 2.836% 1.305% 3.135% 4.995% 4.081%

HSBC/NASDAQ Dubai GCC Sukuk & Bonds US Dollar Index Sukuk 27-July-12 31-December-11 Conventional 27-July-12 30-December-11

Total Return 141.84 133.00 153.56 141.59

3.90 3.59

3.44 4.31

252.96 312.20

Clean Price 4.38 99.41 3.99 95.79

5.38 5.26

3.88 5.07

253.07 322.59

7.03 7.31

Duration Yield

Spread

Life

Coupon Total Market Cap

103.94 98.53

4.81 5.06

224.66 142.39

5.39 5.63

991.20 808.83

Interbank Rates (%) SAIBOR KIBOR BHIBOR QATAR AEIBOR LIBOR EURIBOR

1-Month 30/07/12 31/12/11 0.6125 0.5188 0.6875 0.5625 0.8250 0.8500 0.9500 0.4300 0.8025 0.9750 0.2457 0.2953 0.1600 0.9643

U.S. Treasuries (29 July 2012) 3-Month 2-Year 3-Year 5-Year 10-Year 30-Year

Coupon 0.000 0.125 0.250 0.500 1.750 3.000

Equity Market Snapshot Abu Dhabi SE Bahrain SE Dubai SE Kuwait SE Muscat SE Qatar SE Saudi SE

Last Close 2,481.07 1,109.62 1,510.19 5,748.78 5,376.57 8,285.96 6,769.12

3-Month 30/07/12 31/12/11 0.9475 0.7800 0.9375 0.8125 1.2375 1.2583 1.2071 1.1000 1.3750 1.5200 0.4466 0.5810 0.4150 1.2921

Price 0.11 99-24+ 99-24+ 99-08 101-25+ 107-20 ½

Price Change 0.005 0-00+ 0-00 0-00 -0-01+ -0-00

1 Day Change -0.18% -0.38% 0.08% 0.03% -0.21% 0.72% 0.02%

YTD Change -5.91% -14.54% 0.33% -4.75% -8.70% -1.08% 6.50%

30/07/12 1.1312 1.5000 1.9250 1.7428 1.7512 1.0605 0.9760

1-Year

31/12/11 1.0400 1.3125 1.9583 2.1500 1.9725 1.1281 1.9134

Current Yield (%) Yield Change (%) 0.11 0.005 0.23 -0.004 0.33 -0.002 0.65 -0.011 1.55 0.005 2.63 0.001

Crude Oil Brent WTI OPEC

Price 106.54 90.57 101.47

1 Day ∆ 0.07% 0.24% 1.26%

Gold Spot $/OZ

Price 1,618.60

1 Day ∆ -4.30%

GCC Sovereign Ratings Moody’s S&P Abu Aa2 AA Dhabi

Fitch

Bahrain Baa1 BBB

BBB

Kuwait Aa2

AA

AA NR

AA

Oman

A1

A

Qatar

Aa2

AA

NR

KSA

Aa3 AA-

AA-

UAE

Aa2

NR

NR

GCC Currencies Currency

USD 1-Day ∆

KWD

0.2816 (0.0004)

SAR

3.7503

0.0000

BHD

0.3770

0.0000

QAR

3.6409 (0.0001)

OMR

0.3850

AED

3.6729 (0.0001)

0.0003

EUR/USD 1.2293

0.0029

JPY

78.29

0.0027

USD 5-Year CDS

YTD Change

Abu Dhabi Dubai

113.090

-11.8%

336.532

-22.6%

Bahrain 334.265

-12.7%

Qatar

113.500

-10.9%

Saudi

106.000

-17.5%

Egypt

604.375

-5.5%

Lebanon 492.165

4.3%

Turkey

194.510

China

111.810 -24.03%

-33.2%

France

165.035 -24.93%

Germany 74.390

-27.19%

Japan

91.580

-36.05%

UK

57.960

-40.5%

US

45.110

-7.8%

This report has been prepared and issued by Kuwait Financial Centre S.A.K (Markaz) , which is regulated by the Capital Markets Authority and the Central Bank of Kuwait. The report is owned by Markaz and is privileged and proprietary and is subject to copyrights. Sale of any copies of this report is strictly prohibited. This report cannot be quoted without the prior written consent of Markaz. Any user after obtaining Markaz permission to use this report must clearly mention the source as “Markaz “ .This Report is intended to be circulated for general information only and should not to be construed as an offer to buy or sell or a solicitation of an offer to buy or sell any financial instruments or to participate in any particular trading strategy in any jurisdiction. The information and statistical data herein have been obtained from sources we believe to be reliable but in no way are warranted by us as to its accuracy or completeness. Markaz has no obligation to update, modify or amend this report.For further information, please contact ‘Markaz’ at P.O. Box 23444, Safat 13095, Kuwait. Tel: 00965 1804 800 Fax: 00965 2245 0647 Email: research@markaz.com

A number of sources which include Bloomberg, Zawya, and daily newspapers were utilized in the creation of this report.


GCC Daily Fixed Income Update 30072012