Saudi market recovers, hits five-year high
Dubai, March 23, 2014
Saudi Arabia's bourse led the region on Sunday, recovering from last week's weakness to hit a five-year high with gains in most sectors as global oil prices stabilised.
The index rose 1.3 percent to 9,425 points, its highest level since July 2008. Most stocks closed in the black, including petrochemicals, banks, cement makers and food producers.
"Optimistic sentiment and anticipation of first-quarter results" were the most likely reasons for the rally, said Farooq Waheed, senior portfolio manager at Riyad Capital.
The Saudi index, which includes several large petrochemical companies such as Saudi Basic Industries, eased throughout last week as oil prices retreated. Brent crude , however, partly recovered on Friday.
In positive news for the long-term development of the market, two Saudi companies - water and power project developer ACWA Power and the kingdom's largest lender, National Commercial Bank - revealed steps towards listing their shares last Thursday.
Meanwhile, Dubai's bourse rose 1.0 percent, aided by Emaar Properties, which resumed last week's rally and added 1.6 percent, although Sunday's trading volume was significantly lower than last week. Emaar's recent rally has been triggered by the announcement of a dividend hike and a plan to list its shopping mall subsidiary.
The main Dubai index closed at 4,347 points; last week it broke above technical resistance at 4,242-4,255 points, the February peaks. There is now no significant chart resistance nearby.
Among other gainers in Dubai were property developer Deyaar and construction firms Arabtec Holding and Drake and Scull.
Real estate investment trust Emirates REIT said on Sunday that it had set the price range for its initial public offer of shares at $1.36 to $1.56 per share, and expects the listing on Nasdaq Dubai to occur around the middle of April. It would be Dubai's first IPO since 2009.
Bahrain's index climbed 0.8 percent, largely on the back of Arab Banking Corp, which jumped 7.1 percent. The stock surged last month after news that the bank was hiring Standard Chartered banker Ray Ferguson as its group chief banking officer; it then retreated and is now climbing back to the recent peak. - Reuters