Saudi Arabia’s bourse hit a fresh 12-week high on Monday and Qatari and Dubai shares eased away from multi-week lows as an upbeat response to earnings in the Kingdom lifted sentiment on most regional markets.
Kuwait fell on worries over its financial sector and Oman declined for a fourth day since hitting a 12-week high.
Saudi Arabia’s Tadawul All-Share Index (TASI) started a little weak but during the course of the day, with quarterly earnings reports of Savola and Maaden, moved up to end with a meager gain of 15.38 points. The gains were seen in 9 out of 15 sectors ranging from 0.02 percent by the telecom and IT and building and construction sectors to 5.70 percent by the energy and utilities sector.
The losses ranged from 0.01 percent in the transport sector to 1.88 percent in agriculture and food industries sector. The market breadth remained negative with 50 advancers against 63 decliners giving an AD ratio of 0.7937, the Financial Transaction House (FTH) said in its daily market commentary.
Saudi banks extended gains as investors bet the underperforming sector would improve this year after taking huge provisions in 2009 to steady balance sheets, causing most lenders’ quarterly profits to miss estimates.
“The banking sector is picking up, despite weak results because the market sees the worst is over,” said Rami Sidani, Schroders Middle East head of investment.
Kuwait’s index fell after National Bank of Kuwait said it would increase its capital by 10 percent and the board of Commercial Bank of Kuwait resigned.
“NBK is the third or fourth bank to go for a capital increase -- the banks are doing this to avoid capital adequacy issues, heightening worries about banks’ provisions,” said a Kuwait-based trader who asked not be identified.
Dubai’s index ended a six-session losing streak as stocks rebounded from Sunday’s five-week lows, but late selling pressure eroded much of these gains to underline fragile investor sentiment. “People are trying to get direction from the market and turnover remains low -- there’s a lack of interest from institutions so it’s day traders trying to benefit from volatility, rather than investors trying to build positions,” said Marwan Shurrab, chief trader at Gulfmena Alternative Investments.
Arabtec climbed 4.3 percent, Emaar Properties rose 1.2 percent and Dubai Financial Market added 2.5 percent.
Qatari banks recouped most of the previous day’s losses to help Doha’s index rise 1 percent.
Kuwait inflation plunges to nine-year low
Kuwait's annual inflation rate fell to a modest 2.7 per cent in October - its lowest in nine years, despite robust consumer spending and some improvement in business sentiment, said a report.