Fuelled by expectations of the imminent opening of the hitherto closed doors of the ISX to non Iraqi investors, the market continued its upward surge for the eleventh trade session this month

ISX trade goes on despite security tension, August 30 2007

The security alert and great suspense in Baghdad, triggered by violent clashes in the religious town of Kerbela last Wednesday, did not stop trade on Thursday, August 30 2007, in the Iraq Stock Exchange. But the tension clearly left its mark on the market leading to a sharp drop in volume with the total number of struck deals halved to only 156 contracts down by 44% from previous session.

However, the value of overall volume of trade was paradoxically up 11 % on previous session, from ID 832 million to ID925 million. The hike in volume is explained by two single transactions worth over ID 500 million accounting for 54% of total volume. Both transactions represent deals obviously agreed upon outside the trade hall of the ISX. The first involved the exchange of 4% of the Amean Real Estate, some 86 million shares out of a total of 2000 million outstanding. The second deal involved the transfer of ownership of 50 million shares in the North Bank. Take away these two transactions; you arrive at the true volume of trade executed today. It was in reality no more then ID 400 million, $320,000 which is extremely low but accurately reflecting market reaction to the recent spike in insecurity in Baghdad.

	current session	previous session	%change
Market Volume Traded (shares million)	383.19	523.91	-26.86
Market Value Traded (ID m)	925.40	831.71	11.26
Market Capitalization (ID billon)	2039.27	2055.10	-0.77
Number of Transaction	156	280	-44.29

Market Value Traded ($m)	0.734	0.660	11.26
Market Capitalization ($billon)	1.618	1.63	-0.77

Under the circumstances the drop of prices today could have been much worse. The number of shares to close the trade session down was confined to 11. In fact, six companies made gains albeit some of them in only in very thin trade. Twelve companies held their grounds. In all there were 29 shares traded today out of a total of 94 listed stocks in the exchange. The net effect of all price movements was a fall of total market capitalization value by 0.77% confirming a downward trend in August reversing July gains. The ISX is today worth $1.618 million.

The recent trend of decline, one must point out, is not captured by the ISX official price index due technical reasons attributed to the method used by the exchange in calculating the exchange composite index. For example, despite the obvious fall in all significant high turnover shares today, the ISX ironically reports an increase rather then decrease in the index value.

Only two banks, the North Bank and the Iraq Investment Bank, made modest gains of 2-3%, today. Each of Babil Bank, Basra Bank and Dar-Alsallam Bank made losses of around 3%. The rest of traded banking shares were foot. Despite the large contract in the North Bank, overall trade value in banking stocks was down by 27% to ID502. More indicative of the fall in activity, is the sharp fall in the number of deals struck, down by almost half to only 111 contracts. The total market value of all banking stocks was down to under $1.2 billion. This is the market valuation of 19 listed private chartered banks with a total of outstanding shares equal to 601 billion shares.

Reflecting the very depressed level of activity, trade in manufacturing stocks was only a third of its normal average during the last few months. There was only 33 contracts struck in manufacturing shares with a negligible value of ID33 million or a mere $26,000. Investors are warned by analysts that any price movements up or down, by such thin trade are to be treated cautiously.

Market Breadth
Advancers	6
Decliners	11
Unchanged	12
Total Traded	29
Total not Traded	65
Total	94

DISCLAIMER: This document has been compiled and issued by Kubba Consultants, which has obtained the information from sources it believes to be reliable, but Kubba Consultants makes no guarantee as to either its accuracy or completeness and has not carried out an independent verification. Kubba Consultants accepts no responsibility or liability for losses or damages incurred as a result of opinions formed and decisions made based on information presented in this report. This document is not an offer to sell or solicitation to buy any securities. The opinions and estimates expressed herein are those of the issuer.