Saudi Arabia and Dubai led Gulf stocks higher on Sunday as regional markets resumed trade after last week's holidays, lifted by positive sentiment on global stocks and expected foreign fund inflows into the Riyadh market. The Saudi index rose by 2.2% to finish at 8,699 points, its best close since May 9.
"The market is bouncing back after the correction experienced in the past few weeks," said Riyad Capital's Muhammad Faisal Potrik. "It's taking its cue from global markets as well, which have risen while we were on Eid-ul-Fitr break." Global stock markets advanced and US Treasury yields tumbled on Friday after a slowdown in job growth fuelled hopes of a cut to US interest rates while there were also hints of progress in Washington's trade battles.
Al Rajhi Bank rose 3.2%, Saudi Telecom was up 3.4% and Saudi Basic Industries, the index's biggest stock, gained 2.9%. Late last month the Saudi equity market joined the MSCI Emerging Market index, which is expected to trigger billions of dollars of foreign fund inflows.
A third tranche of the FTSE Russell emerging market index will kick in this month after Saudi stocks were included in two tranches in March and April. The Dubai index also rose, firming by 1.2% as property stocks registered strong gains. DAMAC Properties was up 9.3% and Union Properties rose 4.3%. Market heavyweight Emaar Properties was up by a more modest 0.7%.
The Kuwait index gained 1.5%, lifted by financial stocks. Burgan Bank rose 2.5% and Kuwait Finance House was up 1.3%. Egyptian stocks were also in positive territory with a 0.8% gain. Global Telecom was up 1.5% after the company announced it has postponed its shareholder meeting to provide more time for investors to consider the mandatory tender offer submitted by major shareholder VEON.
Abu Dhabi's index dropped 0.95%, on weakness in First Abu Dhabi Bank, which eased by 1.2%. The Qatar Financial Centre Regulatory Authority on Sunday said it has imposed additional measures to restrict First Abu Dhabi's business in the Gulf state.
In March the Qatari regulator said it would no longer permit First Abu Dhabi Bank, the largest in the United Arab Emirates (UAE), to provide services for new customers in Doha. The ban came amid an investigation of alleged currency manipulation after the Gulf rift. Qatar's index ended 0.2% down on profit-taking after strong gains before the Eid holiday. Qatar National Bank fell by 1.1%.
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