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Vulnerable to instability

Lebanon’s capital market experienced mixed performances and phases.

In 2010, Beirut stock market (BSE) capitalization fell by 2.06 percent to $11.06 billion as a result of drop in stock prices. Lebanon's capital markets performances were mixed. 

 

According to the economic report issued by Bank Audi, while Beirut stock market saw a drop in prices mainly by a sluggish activity with its turnover ratio standing at low level, the Eurobond bond market witnessed some improvement in prices and a contraction in its average spread.

 

 

 “Solidere share prices, the most vulnerable to political developments were the top losers plummeting by 22 percent in 2010. The Eurobond market was marked by a favorable activity, bond prices went up in 2010 as shown by 119 basis drop in the average yield reach 4.12 percent while the average spread contracted by 108 basis points to 182 basis at end-2020.”

The total trading volume reached 141.9 million shares amounted to $1.83 billion compared to 44.98 million shares worth $796.9 million recorded in 2009.

 

 

The BSE market witnessed also mixed phases, affected by the political turbulence in the country. From January to April stocks lifted Lebanon’s BLOM stock index a 52-week high of 1,652 in April registering a 5.53 percent rise from end April 2009, According to the economic report issued by BLOM Bank. “In October, Beirut Stock Index (BSI) registered a decline of 10.47% from end-2009.”

 

It’s worth mentioning that in 2009, market capitalization increased by 34 percent to $12.8 billion year-on-year, of which 66.7 percent was in banking stocks, 30.7 percent in real estate stocks, 2.06 percent in industrial stocks, 0.28 percent in funds, and 0.27 percent in trading stocks.

In late 2008, Moody's has shifted Lebanon's sovereign rankings from stable to positive acknowledging its financial security. Moreover, with a Beirut stock market increase of 51 percent year on year, the index provider MSCI, ranked Lebanon as the world's best performer in 2008.

 

 

The Lebanese banking sector and its currency the Lebanese pound were among the world's most contrary performers during the 2008 global financial crisis.

But despite plenty of skepticism from beyond Lebanon that the country’s remarkable growth numbers in 2008 can continue, the Beirut Stock Exchange was one of the top global equities market performers in 2009 with its market benchmark, the Blom Stock Index, rising almost 18 percent in the year to June 28, 2009 and performance experienced mixed a remarkable 16.23 percent since the global market peak of June 2, according to a research conducted by the British firm The Market Oracle.

 

Beirut

Migration to cities is increasing so much that, by 2050, the UN predicts that approximately two thirds of the world’s population will be living in cities.

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