Activity on the Lebanese stock market was thinner during the eighth month of the year 2020 following the devastating blast in the Beirut Port that shook the city on August 4. In details, volume traded on the BSE plunged by 59.32% to 941,951 shares during the month of August, from 2,315,343 shares in July. Similarly, value traded fell sharply by 64.61% month-on-month to $10.39 million, from $29.36 million in July. Trades mainly comprised real estate sector stocks, which controlled 76.49% of the total traded volume, followed by banking stocks (23.51%) with no activity on industry & trading stocks being recorded. The market capitalization of listed stocks remained almost flat at around $6.20 billion by end of August, yet remained much lower than the circa $7.87 billion reading recorded in August of last year.

On a cumulative basis, the number of shares changing hands on the BSE plunged by 54.56% year-on-year to around 86.59 million shares during the first eight months of the current year partly owing to the lockdown that accompanied the COVID-19 outbreak, with value traded sinking by 85.96% over the same period to about $114.86 million. As far as trading multiples are concerned, the weighted average Price to Book Value (P/BV) of listed stocks ended the eighth month of 2020 higher at 0.849x, compared to 0.803x in July mainly owing to the significant increase in the prices of Solidere “A” and “B” shares.

Overall, trading activity was thinner during the month of August 2020, as evidenced by the drop in the turnover ratio (being the number of shares traded divided by total listed shares) to 0.05%, down from 0.12% in July. The turnover ratio, however, reached 4.45% on a cumulative basis by end of the first eight months of this year, compared to 10.85% in the same period last year as a result of the economic meltdown and lack of political consensus on Lebanon’s reform journey.