Gulf bourses muzzy pending Q2 results |
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JEDDAH - Uncertainty prevailed at most of Arab stock markets this week as investors awaited the release of second-quarter corporate results, which they believed would decide the course of regional markets in the coming stage, financial analysts said Friday.
"We think Arab markets will continue to be directionless in the coming few weeks as investors monitor the publication of balance sheets of listed firms to decide their positions for the coming stage," a portfolio manager said.
"I believe regional markets will also be affected by the movement of oil prices and the indicators released about the performance of the world's recession-hit major economies that are supposed to provide clues for a way out of the current chaos," he said.
Saudi shares were volatile this week as the financial sector was negatively affected by hardships facing Al-Saad and Al-Qossaibi groups.
The Tadawul All Share Index (TASI) of the Arab world's largest bourse shed 0.2 percent this week. It closed on Wednesday at 5,599.38 points, up 0.05 percent.
TASI is currently 16.6 per cent higher than the year's start, according to the weekly report of the Riyadh-based Bakheet Investment Group (BIG).
The report expected the Saudi exchange to respond to the quarterly results of listed firms, particularly banks and the Saudi Arabian Basic Industries Corp. (SABIC).
However, in the first half of this year, The Tadawul All Share Index was up 16.52 percent in the year to date at Tuesday's close, helped by a recovering oil price, after losing almost half its value in the second half of 2008, with insurance companies as the biggest gainers.
The market sees about 177 million shares change hands for the value of SR4.9 billion. "The volumes are very low, and we believe the market will keep trading within a tight margin until second-quarter results are out," said one trader. Alinma Bank most active, closes +0.4 percent at SR13.20.
The best performing stock, Al Sagr Company for Cooperative Insurance, increased more than three-fold in value.
Fears that global financial turmoil has spread to the Kingdom weighed on banks, with index heavyweight Samba Financial Group falling by 18.4 percent.
Other losers included companies in traditionally defensive sectors such as dairy giant Almarai, which rose 11.25 percent but underperformed the wider index, and diversified food manufacturer and supermarket operator Savola Group, which lost 8.1 percent of its value.
Savola's oil and sugar manufacturing businesses have been badly hit by a drop in global commodity prices, and investor uncertainty over some of its real estate projects.
Companies in the increasingly competitive telecom sector were also among the laggers, with Saudi Telecom and Zain Saudi Arabia rising by only 4.9 percent and 10.3 percent, respectively.
Kuwait's KSE all-share index fell 0.4 per cent, closing week at 8,108 points, against speculation that Kuwaiti stocks were set to rebound after the Interior Minister Sheikh Jaber Khalid Al-Sabah survived a parliamentary no-confidence vote.
The performance of the United Arab Emirates stock exchanges of Dubai and Abu Dhabi was mixed.
Dubai's all-share price index lost 2.0 percent this week, closing at 1,821 points, while Abu Dhabi's benchmark price gained 1.6 per cent, to close at 2,671 points.
The Dubai bourse was negatively affected by reports that UAE banks extended loans to the two troubled Al-Saad and Al- Qossaibi amounting to $3 billion.
© The Saudi Gazette 2009
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Gulf stocks have been tracking the global upturn, though not with much enthusiasm it must be said, and even that momentum is waning now with a feeling that the stock rally has gone too far, too fast and is not supported by fundamentals. The most radical think it may be time to short stocks, see:
http://arabianmoney.net/2009/07/04/is-it-time-to-short-the-sp-500/ [Report Abuse | Email to a Friend | Reply to this Comment]