DUBAI: Stock markets in the Gulf Arab region rebounded yesterday as US and Asian shares rallied after the US government bailed out embattled insurer American International Group (AIG).
“Gulf markets are fully integrated in the global financial system. As there is a positive sentiment globally, it is affecting these markets, which have fallen recently, so we are seeing a normal rebound,” said Rami Sidani, head of MENA investment Shroders Investment Management.
Qatar’s bourse was the biggest gainer, posting its largest single-day gain in at least two years as all stocks on the main index ended higher. The main index ended 8.61 percent higher at 8,880 points. Qatar Gas Transport Co. and Industries Qatar led the gains, soaring 9.05 percent and 9.28 percent respectively.
Oman ended a five-day loosing streak during which it lost more than 11 percent, and Kuwait extended its gains into a second day after comments by government bodies in both countries helped allay investor fears.
The main index in Oman closed 4.16 percent higher at 8,229 points. Shares of National Bank of Oman (NBO) surged 7.51 percent.
The benchmark Kuwaiti index extended its rise into a second day, closing 1.87 percent higher at 12,602 points. National Bank of Kuwait surged 6.1 percent, helping to lift the index to a higher close, after the lender starts buying back stock that fell 4 percent last year.
“The regulator has reassured investors, prompting buying by locals and some international institutions, which are buying shares of National Bank of Oman and Bank Muscat,” says Adel Nasr, broker at United Securities brokerage.
“These (Omani) banks have no transactions with or relations to Lehman Brothers, so there is no risk,” Adel adds.
In Saudi Arabia, the Tadawul All-Share Index (TASI) closed 2.36 percent higher at 7,387.25 points. Al-Rajhi Bank gained 3 percent and Saudi Basic Industries Corp. rose 0.95 percent.
The benchmark Dubai index ended 2.29 percent higher at 4,044 points, after losing more than 12 percent in five earlier sessions. Dubai’s Arabtec Holding surged 8 percent and Emaar Properties gained 1.96 percent.
Abu Dhabi’s stock index ended up 1.62 percent at 3,831 points. Emirates Telecommunications Corp. and National Bank of Abu Dhabi gained 2.24 percent and 3.67 percent respectively.
The benchmark Bahraini stock index edged 1.13 percent higher to 2,519 points.
Ahli United Bank rose 1.83 percent and Gulf Finance House surged 5.88 percent.
Lehman Brothers has filed for bankruptcy, triggering worries about the health of the financial sector in the US, which has set off a global selloff in shares. But markets have rebounded after the US government bailed out cash-strapped AIG.
Kuwait Investment Authority has said it would boost investments in local shares. Oman’s Capital Market Authority described the decline in share prices as “temporary” and that they will pick up again on favorable economic conditions.
BMG index rebounds
The BMG Saudi Index ended the week with an increase of 2.83 percent in yesterday’s trading session, to reach a closing level of 400.06 points. The total market turnover also ascended by 7 percent to SR2.2 billion ($596 million), compared to SR2.1 billion ($559 million), registered in Tuesday’s trading session.
With regard to the performance of the sectors, all the sectors went up. The best performer was the services sector, advancing by 3.7 percent, whereas the telecommunications sector ascended by 3.1 percent and the banking sector improved by 3.0 percent.
Twenty-nine shares appreciated, while one went down. The best performer was Saudi Indian Company for Cooperative Insurance, going up by a strong 9.4 percent to SR63.75 per share. The worst performer was Malath Cooperative Insurance and Reinsurance Company, falling by 1.4 percent to reach SR102 per share.
