UAE- Oil rally fuels bullish views in Gulf stocks

Date

3/7/2016 11:33:19 PM

(MENAFN- Khaleej Times)

Dubai: Rising oil prices put energy in Gulf stocks as bullish sentiments witnessed across the regional markets.

Brent crude rose 4.5 per cent to $38.72 per barrel on Friday the highest level in three months. Nigeria's petroleum minister said Opec members and Russia may meet to discuss capping output later this month.

The bullish trend in the region came despite an announcement from Moody's Investors Service on Friday in New York that it was placing more than 10 oil producing nations on review for potential downgrade including Saudi Arabia the UAE Qatar and Kuwait in the GCC.

At the Dubai Financial Market (DFM) Arabtec Holding was the most traded stock in Dubai extending its steepest weekly gain in seven years. Traders exchanged about 304 million shares in the builder six times the six-month average. The stock rose nearly 13 per cent to the highest level since October.

The DFM General Index which entered a bull market last month increased 2.9 per cent.

The DFM witnessed 1.2 billion shares turnover with the help of 13079 total trades. In total 36 traded issues 28 advanced five declined and three remained unchanged.

Abu Dhabi stocks entered a bull market leading Mideast gauges higher on rising oil prices. The ADX General Index climbed 3.1 per cent at the close extending the longest winning streak this year.

Last week bourses in the region were lifted by higher volumes in small and mid-sized stocks that are largely favoured by local traders. Riyadh's and Dubai's indexes each rose four per cent last week although in Dubai most turnover was concentrated in builder Arabtec which soared 42 per cent last week in speculative trade.

First Gulf Bank the lender with the biggest weighting on the ADX General Index led the advance as it jumped 4.7 per cent. Emirates Telecommunications Group the company with the second-biggest weighting known as Etisalat added 3.6 per cent.

The Bloomberg GCC 200 Index a gauge of the region's 200 biggest and most liquid companies added two per cent to the highest levelin two months.

Among other Gulf stocks Kuwait's SE Price Index added 0.7 per cent. The stock market in Qatar was closed for a national holiday.

Saudi Arabia's Tadawul All Share Index climbed 2.9 per cent to the highest level in two months.

"Saudi and regional markets are taking a cue from rising oil prices as Brent crude closes in on $40 dollars per barrel" Muhammad Faisal Potrik the head of research at Riyad Capital told Bloomberg.

"News from Moody's on downgrading some countries in the region and putting others on review for a downgrade has largely been ignored today. The market has rallied well but can undergo some technical correction if the oil price stalls" Potrik added.

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