Amman SE CEO Letter

Monday, 1 September 2008

The Amman Stock Exchange (ASE) has recently accomplished many projects aiming at enhancing market efficiency and upgrading the services provided to the market participants.

The ASE in cooperation with Dow Jones launched the Dow Jones ASE 100 Index. The index is a broad benchmark index that tracks the performance of the 100 largest stocks listed at the ASE based on free-float market capitalization. The Dow Jones ASE 100 Index was developed to meet the demand for index-based products at the ASE and eventually to replace the ASE general price index. The Dow Jones ASE 100 is expected to further enhance transparency, visibility and accessibility of the performance of the ASE for Local, regional and international market participants by applying Dow Jones Indexes’ well-known and widely used index methodology.

For the first time, the Jordan Securities Commission issued a Code of Corporate Governance for the companies listed at the ASE. The introduction of this code is considered as an important step forward in the field of monitoring and transparency over the public companies and in preserving the rights of all stakeholders in these companies.

The ASE started a new project to build the Jordan National Financial Center. His Majesty King Abdullah II laid the foundation stone for this project. This center will contain: the ASE, Securities Depositary Center, Financial Studies Institute, Brokers Offices, Investors Gallery and many other facilities. The cost for this project is expected to reach US$ 100 million.

The World Federation of Exchanges (WFE) has accepted the full membership of the ASE during its annual meeting in October 2007, which was held in Shanghai/China. This is attributed to the developments of Jordan capital market in general and the technical, legislative developments of the ASE in particular, besides abiding by transparency and disclosure principles.

To enhance the international exposure, the ASE held Jordan Capital Market Day in March 2008 in London in cooperation with London Stock Exchange. This day was a great opportunity for Jordanian companies to raise funds and attract foreign investment. Also the ASE will organize the 2nd Capital Market Conference in New York in September 2008.

As for the ASE performance, the ASE Free Float Weighted Index at the end of July 2008 stood at 4630 points compared with 3675 at the year 2007 with an increase by 26%.  ASE index weighted by Market Capitalization closed at 10399 points at the end of July 2008 compared with 7519 points at the end of 2007, an increase by 27.7%. Trading value by the end of July 2008 reached US$ 21.3 billion with an increase of 31.7% compared to the same period of 2007. The number of shares traded increased by 54% compared with the same period of 2007, reaching 3.9 billion shares, and the number of transactions increased by 31%, reaching 2.7 million transactions. The ASE market capitalization reached US$41.2 billion by the end of July 2007, with an increase of 81.6% over the end of 2007, representing 358% of the GDP. The net investment of non-Jordanian investors increased by US$ 330.5 million by the end of July 2008. As a result, non-Jordanian investors ownership in the ASE market capitalization increased to 50.9%.