RIYADH- Saudi market extended gains on Tuesday morning, hitting its highest level since the third quarter of 2015, backed by solid performance of leading stocks. Other markets in the region were mixed.
Oil price increase and the potential inclusion of Saudi in the MSCI emerging market index in June have boosted investor sentiment in Saudi market this year on hopes of significant foreign fund inflows to the region's biggest stock market.
"Higher oil prices are the main driver for the Saudi market, people are optimistic over prices going further up in the coming months," said Mazen al-Sudairi, head of research at Rajhi Capital.
People are also optimistic about earnings, average multiples in Saudi have gone up o 17.4 times, exceeding the global averages: FTSE global average is at 16, he added, warning that the more the market goes up, the higher the possibility of a correction over the coming weeks.
The Saudi index was up 0.3 percent in morning trade at 8073.48 points, the highest level since August 2015. Petrochemical giant Sabic 2010.SE rose 0.9 percent on heavy trades before it goes ex-dividend on Wednesday.
Al-Rajhi Bank rose 0.1 percent to 80.9 riyals ($21.6), its highest level since August 2008.
Real estate company Arriyadh Development 4150.SE lost 4.2 percent after it reported making an almost flat net profit net profit of 43.5 million riyals in the first quarter versus 43.3 million a year ago.
The Abu Dhabi index rose 0.3 percent, backed by a 1.4 percent increase by Aldar Properties after it announced launching a new 10 billion dirhams ($2.72 billion) masterplan for enhancing its Alghadeer project close to the Abu Dhabi-Dubai border.
Dubai index lost 0.2 percent on a 3.3 percent decline by courier firm Aramex as it goes ex-dividend.
In Doha, benchmark index lost 0.1 percent. Masraf Al Rayan led declining stocks, falling 0.7 percent and Qatar National Bank lost 0.2 percent.
Qatar Gas Transport added 1.03 percent. ($1 = 3.6730 UAE dirham)
(Reporting by Marwa Rashad; Editing by Saeed Azhar) ((email@example.com; +966114632603 ; Reuters Messaging: firstname.lastname@example.org))