JEDDAH/DUBAI: Four Gulf Arab benchmarks reached multi-week highs on Monday as bullish global equities, a weakening dollar and rising oil prices boosted regional stocks, although some analysts warn these gains could prove temporary.
Dubai’s index surged 3.6 percent to a six-week closing high, Oman gained 1.7 percent to reach its highest close of 2009 and Abu Dhabi and Qatar also hit their highest finishes since mid-June.
Petrochemical stocks lifted Saudi Arabia’s index as regional bourses reacting to bullish international sentiment rather than being driven by their own fundamentals.
The Tadawul All-Share Index (TASI) rose 0.9 percent to 5,818 points.
With only one negative sector close on Monday, -0.10 percent in the Transport sector, the market had a relatively positive day, with sector gains ranging from 0.10 percent in the Telecom sector to 2.08 percent in Real Estate Development. In addition, Monday’s market breadth was positive, with 83 advancers and 34 decliners registering an AD ratio of 2.44, the Jeddah-based Financial Transaction House (FTH) said Monday in its market commentary about the Saudi stock market.
“In the short-term we should see some consolidation,” said Sanyalaksna Manibhandu, Emaar Saudi Financial Services head of research.
“The markets have gone up, but volumes are not that great and so the rise is probably a bit misleading.”
Volumes in most Gulf bourses were below recent norms, with Kuwait’s at a quarter of its three-month average and those in Saudi Arabia and Qatar were less than half of their averages.
Emaar Properties surged 8.5 percent after it said it was considering an initial public offering for its Indian unit. On Sunday, Emaar fell 1.1 percent after reporting a second-quarter loss as it wrote off a US unit. [
UAE banking stocks advanced, with investors unmoved by declines in quarterly earnings and the prospect of further provisions from defaulting personal and corporate borrowers.
“UAE bank results have been positive, with lenders’ capital adequacy ratios increasing, which shows stability is improving,” said Wadah Al-Taha, a Dubai-based financial analyst.
Kuwait’s index edged up 0.1 percent, lagging gains on other regional benchmarks. “Less than 50 percent of listed companies have declared their results and the deadline is Aug. 15,” said Naser Al-Nafisi, general manager for Al-Joman Center for Economic consultancy in Kuwait.
Investors are reluctant to buy stocks until the reporting deadline passes, Al-Nafisi said, because they fear being stuck with shares they cannot trade.
In April, more than 30 firms’ shares were suspended after they failed to post their results in time.
The Dubai index stock index closed at 1,885 points and Abu Dhabi index rose 0.7 percent to 2,839 points. The Qatari index climbed 0.4 percent to 6,787 points. The Kuwaiti index edged up 0.1 percent to 7,691 points.
The Omani index climbed 1.7 percent to 6,061 points.
The Bahrain index fell 0.4 percent to 1,481 points.