MSM remains resilient amid oil gains

16/08/2016 05:49 AST

With better than expected second quarter earnings and rise in oil prices, the Muscat Securities Market continued to be resilient for the third consecutive week. Although the market ended flat on Monday following stock-specific buying, analysts expect the positive bias to continue in the coming weeks.

“The market has been stable since last week of July. The rise in the oil prices is expected to extend its support to the local bourse”, said Suresh Kumar, head of research at Al Maha Financial Services.

Average daily turnover for July 2016 increased to RO 3.6 million as compared to RO 3 million in previous month.

Crude hit a one-month high with almost 11 per cent increase on Monday on hopes that the prolonged oil-price rout may drive major producers to reconsider a collective production cap in the next Opec meeting. Last week Saudi Arabia’s Energy Minister Khalid al Falih hinted that his country was open to measures to stabilise the market.

The GCC is home to about 30 per cent of the world’s proven crude reserves and governments depend on energy income for the bulk of spending.

In Monday’s trading the benchmark MSM30 Index closed at 5,906.710 marginally down 0.05 per cent from its previous close.

The financial index, which had been in the positive trajectory with banks taking the lead, was marginally down by 0.11 per cent.

Last week the Financial Index advanced by 1.30 per cent. Oman Oryx leasing was the highest gainer, while Bank Muscat led the turnover and Bank Nizwa topped the volume.

While non-Omani investors were net buyers with RO 1,152,000 worth of shares, the value of shares sold by non-Omani investors reached RO 1,309,000. The net non-Omani investment declined by 4.25 per cent.

The board of the state-owned telecom provider on Sunday approved distribution of interim dividend by 40 per cent of the paid-up capital to shareholders registered at the end of trading on Wednesday, August 31, 2016.

In the region, Dubai’s index added 0.7 per cent to 3,594 points, nearing technical resistance at its April peak of 3,605 points. Any break would point up to the October peak of 3,740 points. Abu Dhabi’s index inched up 0.2 per cent with small and mid-cap shares outperforming. Dana Gas rose 1.8 per cent and investment firm Waha Capital added 2.1 per cent.

In Qatar, the index edged down 0.2 per cent with Ezdan Holding, a real estate company, dropping 0.8 per cent. Shares in the company are up 10 per cent since July 1.

Oman Daily Observer