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FEDERATION OF EURO-ASIAN STOCK EXCHANGES SEMI ANNUAL REPORT MAY 2005
AMMAN STOCK EXCHANGE
Jalil Tarif
Executive Manager
For the second consecutive year the ASE
performance was outstanding in 2004.
Performance indicators reached their all-time
high since the establishment of the securities
market in 1978. In December 2004, the ASE
price index reached 4254 points, a record
high, and closed at 4246 points at the end of
2004, up by 62.4% compared to its’ 2003
closing. Trading volume doubled to reach
US$ 5.4 billion and the ASE's market value
went up by 67.7% to reach US$ 18.4 billion
or 185% of the GDP, which indicates the
important role the ASE plays in the national
economy.
As a recognized sign for the increasing
confidence in the ASE, Wilshire Associates
issued a revised report including a list of
emerging markets that have an attractive
investment climate in securities markets.
Jordan ranked 10th among the 27 most
attractive emerging stock markets, jumping
two steps a head of Jordan’s rank in 2003.
The improvement in Jordan’s ranking can be
attributed to regulatory, legislative and
technical developments that have been
implemented over the last year. This report
HISTORY AND DEVELOPMENT
The Amman Stock Exchange (ASE) was
established in March 1999 as a non-profit,
private institution with administrative and
financial autonomy. It is authorized to
function as an exchange for the trading of
securities. The Exchange is governed by a
seven-member board of directors. An
executive manager oversees day-to-day
responsibilities and reports to the board.
The ASE membership is comprised of
Jordan’s 30 brokerage firms.
The history of securities trading in Jordan
traces its origins back to the 1930s. In 1976,
the Amman Financial Market was
established to create a regulated trading
market. More recently, as part of Jordan’s
move to upgrade its capital market, a new
Securities Law was enacted in 1997
separating the supervisory and legislative
roles from those of exchange operations.
As a result, the Jordan Securities
Commission (JSC) was created at the same
time as the ASE and the Securities
Depository Center (SDC) were established.
The JSC supervises the issuance of and
trading in securities and monitors and
regulates the market. The SDC oversees
clearing and settlement and maintains
ownership records.
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ASE's market value went up by 67.7% to
reach US$ 18.4 billion or 185% of the GDP,
which indicates the important role the ASE
plays in the national economy.
was prepared for one of the largest USbased
pension funds, “The California Public
Employees Retirement System” (CalPERS).
Also in 2004, the ASE issued new Listing
Directives in which the trading of public
shareholding company shares are divided
into two markets, according to shareholders
equity, free float, profitability, number of
shareholders, liquidity and disclosure criteria.
By these directives, companies listed at the
first market must provide the ASE with
quarterly reports. Also the ASE has amended
it’s internal By-Laws which introduced a set
of amendments to the organizational
structure and departments of the ASE. As a
result, a new Surveillance and Inspection
Department was created. Further, these new
Trading Directives include a number of
ethical rules that brokerage firms must abide
by in their relations with their clients.
As part of the ASE’s efforts to strengthen ties
of cooperation with international market
institutions, the ASE has been accepted as
an Affiliate member of the World Federation
of Exchanges (WFE), this decision was taken
in recognition of the progress that has been
To provide a transparent and efficient
market, the ASE implemented internationally
recognized directives regarding market
divisions and listing criteria. It also adopted
procedures for improving regulatory
effectiveness.
On 26 March 2000 the ASE launched an
automated order-driven Electronic Trading
System. The new system is in compliance
with international standards and takes into
account the G-30 recommendations. This
system also offers brokers immediate
access to stock prices and orders and
enables members to trade remotely.
made in the business development of the
ASE, and its efforts to deepen its local
significance and presence in the Jordanian
economy. The ASE has also been elected as
chairman of the Working Committee of the
Federation of Euro-Asian Stock Exchanges
(FEAS).
In 2004, the ASE was the main sponsor of
the Annual Conference of the International
Organization of Securities Commissions
(IOSCO) that was held in Amman May 2004.
The ASE also hosted a conference on the
Greek experience in the capital market
development, this conference came as a
result of the Cooperation Agreement that
was signed between the ASE and the
Thessaloniki Stock Exchange Center in
October 2002.
To develop its data dissemination policy, the
ASE has launched a new website
www.exchange.jo. The new site contains
many new advantages and information such
as, on-line market depth and the company
guide, in addition to a number of added
features of interest to investors.
FUTURE OUTLOOK
During 2005 the ASE will:
• apply for a full membership in the World
Federation of Exchanges (WFE);
• upgrade the technical infrastructure;
namely; the electronic trading system to the
AtosEuronext V800, the Wide Area Network
(WAN) to accommodate projects in the
fields of surveillance systems and
automating communication with brokers,
issuers and the disaster recovery site;
• implement new sectoral distribution, which
will be consistent with international
standards;
• improve information dissemination by
introducing new retail products;
• introduce and publish a new price index,
which is a free float weighted index that was
tested during 2003 and 2004; and
• redesign all publications and bulletins,
while concentrating on the monthly statistical
bulletin and the companies’ guide.