DUBAI: Middle East stock markets extended gains on Thursday, helped by a rise in oil prices this week and by dovish comments from US Federal Reserve Chair Janet Yellen that pointed to a more gradual tightening of monetary policy.
US treasury yields eased following Yellen's statement that interest rates could not rise "all that much further", a positive factor for emerging markets globally.
Inflows from emerging market investors in the Gulf provided support to the Qatari and the United Arab Emirates stock markets in particular, as they are both linked to the MSCI emerging markets equity index.
EM inflows were particularly strong in Qatar, with the stock exchange up by over 2 percent on the day. The Qatari index was at its highest since some of its Arab neighbours severed diplomatic and transport ties with the tiny Gulf state in early June.
The undervaluation of the Qatari market in recent weeks led to some movement from the UAE to the Qatari market, given the big gap in valuation between the two exchanges, according to a Qatari fund manager.
Qatar Electricity and Water, Vodafone Qatar and Qatar National Bank were the strongest performers in Qatar, with gains of up to 5.6 percent.#
Qatar National Bank rose 4.2 percent after the bank reported an almost 3.6 percent increase in its second quarter profits earlier during the week.
The Saudi market was slightly up on Thursday, with the Riyadh index 0.18 percent higher day on day.
Some companies' results began to come out over the past few days, and they have generally been above expectations. This has given some strength to the Saudi stock market, in particular in the consumer and the financial sector.
Banque Saudi Fransi and Al Rajhi Banking & Investment have both increased their dividends' pay-outs - an unexpected move that lifted the whole banking sector in Saudi Arabia. Al Rahji was up by 1.2 percent on Thursday, while Bank AlJazira was the one registering the highest gains, climbing 2.7 percent day on day.
On the consumer side, Jarir Marketing announced on Thursday a net second quarter profit of 157.8 million riyals, confirming expectations of a strong performance by the consumer sector after the Saudi government's decision to reinstate the public sector workers' allowance that had been cut last October because of pressures on the state's coffers.
In the United Arab Emirates, the Abu Dhabi stock exchange went up 2.46 percent, while Dubai gained 1.23 percent on Thursday.
First Abu Dhabi Bank was up by 3.94 percent on expectations of positive financial results. Union National Bank rose by 3.68 percent on the back of an increase in its second quarter results, as announced by the company earlier this week.
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