JEDDAH, 4 October 2006 — Regional stock markets in September generally continued to build on the positive trend set in August as four of the six Gulf Cooperation Council (GCC) markets registered gains. The UAE and Qatar ended lower, while the North African markets of Egypt, Morocco and Tunisia continued their strong performance.
The upward momentum was particularly strong in the Egyptian and Omani markets which grew by about seven percent continuing their recent sparkling performances, according to a review of the regional stock markets for September.
The largest stock market, Saudi Arabia, was up by around 2.7 percent for the period. The market saw a rise of more than three percent in the first week of September on the back of an increase in volume of shares traded and optimism regarding third quarter results, Bassem El Zein, vice president communications and marketing of Dubai-based Rasmala, told Arab News yesterday.
Presenting his review of the regional stock markets for September, he said that the market appetite for initial public offerings (IPO) was expected to remain strong due to the success of the Red Sea Housing Services Company IPO in August and the Saudi International Petrochemical Company (Sipchem) IPO earlier in September.
“The secondary (stock) market remains very volatile and the largest movements are often seen toward the very end of the trading sessions as investors book their profits or buy back cheap stocks,” he added.
This market can be expected to perform reasonably well going forward. Investors are encouraged to keep their focus on fundamentally solid and profitable primary and secondary market listed stocks.
The UAE markets were lower over the month as the sharp rises in the first week of September were followed by significant falls in the second and third weeks before the market staged a mild recovery toward the end of the month.
Arabtec Construction, the Dubai listed construction company, received a major contract for housing projects from real estate giant Emaar Properties, worth more than AED1.57 billion.
The construction sector in the UAE continues to boom.
A recently published study by a leading global real estate consultant placed Dubai second only to Moscow in terms of activity in the office construction sector while Abu Dhabi has announced projects in the construction sector worth up to $100 billion over the next five years.
Market heavy weight, Emaar Properties, continues to seek opportunities outside the UAE and has received an in-principle approval from the Pakistani government to build a model city. The estimated value of that project is $43 billion.
The Egyptian market continues to build on its gains in July and August as the market rallied by more than seven percent for the month.
The Qatari market continued its weak performance and trading volumes continue to be largely concentrated on Al Rayan Bank, Gulf Cement Company and Qatar Gas Transport Company.
The Kuwaiti market is continuing to realize its potential and was up by over 4.5 percent for the month.
The Omani market posted gains of about 7 percent for the month, making it the best performing GCC market amidst constantly improving trading volumes.
The Jordanian market started the month off very well but the market fell over the next three weeks resulting in a loss of around 2.6 percent for the month.