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NASDAQ Dubai Monthly | March 2010 If the newsletter is not displaying correctly, click here to read it online 

Welcome to the latest issue of NASDAQ Dubai Monthly, our online newsletter that updates market participants about developments at the exchange.

SUMMARY


  • NASDAQ Dubai moves closer to operations consolidation with DFM
  • Equities volumes in February rise 61% month on month
  • Derivatives volumes in February rise 29% month on month
  • Most active Members in February: Citigroup, HSBC, Deutsche
 
NASDAQ Dubai moves closer to operations consolidation with DFM

NASDAQ Dubai is working closely with its market participants to ensure that its market operations consolidation with Dubai Financial Market (DFM) takes place smoothly. The consolidation, which is subject to regulatory approval, is expected to be implemented in April 2010.

Under the consolidation, NASDAQ Dubai will outsource its trading, clearing, settlement and custody functions for equities to DFM. NASDAQ Dubai is also encouraging its equity issuers to switch their listing currency from US dollars to UAE Dirhams.

These moves are designed to make it easier for UAE retail investors to trade NASDAQ Dubai equities, improving their liquidity.

Details of the consolidation can be viewed here. Questions can be sent to the NASDAQ Dubai Consolidation Web Desk at  http://www.nasdaqdubai.com/contact/index.html .  

NASDAQ Dubai will maintain its identity as a distinct market, keeping its own Business and Listing Rules and its Official List of Securities. It will continue to be regulated to international standards by the Dubai Financial Services Authority (DFSA).

The consolidation does not apply to equity derivatives.

Derivatives volumes reach 8,120

Equity derivatives volumes reached 8,120 contracts in February 2010, up 29% from 6,290 in January 2010. In February 2009, a total of 386 traded.

A total of 139,422 contracts have traded since NASDAQ Dubai launched its equity derivatives market in November 2008.

Equity futures are listed on 21 individual UAE companies and on the FTSE Nasdaq Dubai UAE 20 share index, which was designed as a hedging and investment mechanism for GCC and international investors.

The FTSE Nasdaq Dubai UAE 20 index fell 7.7% in February 2010 to end the month at 1,589.
Index constituents are selected for high market capitalisation and liquidity as well as openness to foreign investment.

By both value and volume, Air Arabia was the most heavily traded futures contract in February  2010, followed by DP World.

To promote understanding of derivatives in the region, NASDAQ Dubai Academy will run a series of courses in 2010 aimed at industry professionals. The first two will take place in April. (For details see Academy below).

Equities volumes rise month-on-month

Equities trading volumes on NASDAQ Dubai rose by 61% in February 2010 to 322 million, compared to 200 million in January 2010.

February’s volumes were down 43% from the 566 million recorded in February 2009, the highest monthly total of that year. The value traded in February 2010, at $133 million, was 12% higher than in February 2009, as a result of an increase in the share price of DP World, from an average of 23 cents in February 2009 to an average of 45 cents in February 2010.   
Exchange Views

In his latest monthly column, Jeff Singer, Chief Executive of NASDAQ Dubai, criticised US government proposals to reshape the structure of investment banks, by limiting the types of business they may do. He argued that the government should focus instead on improving regulation of derivatives, as these were partly responsible for the global financial crisis that began in 2007. The Exchange Views column was published in Gulf News and in Al Khaleej.

 
FTSE NASDAQ Dubai UAE 20 share index falls 7.7% in February

The UAE 20 index fell by fell 7.7% in February to 1,589, its fourth consecutive monthly drop. The UAE 20 index comprises DP World as well as 10 stocks on the DFM and 9 on the ADX. Its stocks are chosen for large market capitalisation and investability and are free float weighted. Futures contracts listed on the index by NASDAQ Dubai have been designed as a hedging and investment mechanism for GCC and international investors.

Read more about the constituents of the index here >


Equity futures trading – February 2010
US$ Futures Contracts Value (US$)
DPW 2,584 114,100
UAE Dirham Futures Contracts Value (AED)
AIRARABIA 4,496 420,700
WAHA 1,040 88,400
 
Members Market Share

Citigroup Global Markets was the most active Member of the exchange by volume of all traded instruments in February 2010, followed by HSBC and then Deutsche Bank. EFG Hermes was the most avtive regional Member, followed by Arqaam Capital and SHUAA Capital.

Market share, by value of all traded securities – February 2010
Member Market Share %
Citigroup Global Markets 33.47
HSBC 21.35
Deutsche Bank 12.87
EFG Hermes 10.32
Credit Suisse Securities (Europe) 8.76
Merrill Lynch International 3.31
Morgan Stanley & Co International 2.53
Arqaam Capital 1.45
SHUAA Capital 1.41
JP Morgan 1.33
Mashreq Securities 1.15
Emirates NBD Capital  0.65
UBS 0.30
Al Ramz  0.24
SusqueHanna International Securities 0.22
Emirates NBD Securities 0.20
MAC Capital 0.18
DFBS (Mubasher) 0.16
Goldman Sachs International 0.09
 
NASDAQ Dubai Academy

NASDAQ Dubai Academy to run derivatives courses

NASDAQ Dubai Academy provides training courses in English and Arabic for market participants including issuers, Members, investors and the general public.

Training in April 2010 will include two one-day sessions on equity derivatives. Courses in  coming weeks will also take place on the debt markets, investor relations, understanding financial results, and public relations.  

 Scheduled courses (in English and in Dubai unless otherwise stated):

  • The Fundamentals of Trading Equity Derivatives
    April 13, 2010 (in conjunction with 7 City)
  • Exotics, Strategies, Greeks and Managing Option Risk in a Trading Book
    April 14, 2010 (in conjunction with 7 City)
  • Introduction to Financial Markets, Financial Public Relations and Investor Relations (Saudi Arabia)
    April 26, 2010 (in conjunction with FinanceTalking)
  • Best Practice and Compliance in Financial Communications (Saudi Arabia)
    April 27, 2010 (in conjunction with FinanceTalking)
  • Understanding Debt Markets and Debt IR (Saudi Arabia)
    April 28, 2010 (in conjunction with FinanceTalking)
  • Introduction to Financial Markets, Financial Public Relations and Investor Relations
    May 23, 2010 (in conjunction with FinanceTalking)
  • Introduction to Financial Results and Annual Reports
    May 24, 2010 (in conjunction with FinanceTalking)
  • Best Practice and Compliance in Financial Communications
    May 25, 2010 (in conjunction with FinanceTalking)
  • Understanding Debt Markets and Debt IR
    May 26, 2010 (in conjunction with FinanceTalking)