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Arab stocks rebound, buoyed by soaring oil prices

They expected regional bourses to continue their upward trend in the coming few weeks as investors expect a major part of the huge Gulf surplus petrodollars to find their way to stock markets.

“I believe the record oil prices and the low prices of blue-chip firms will provide strong driving force to regional bourses in the months ahead,” Nizar Taher, the head of brokerage at the Jordan Ahli Bank, told Deutsche Presse-Agentur dpa.

“Investors have now become aware that the plunges which rocked Arab stock markets as a result of the US recession fears were illogical and unfounded,” he said.

Against this kind of analysis, Saudi shares performed vigorously this week with the Saudi Basic Industries Corp (SABIC) and al-Rajhi Banking Group taking the lead.

The Tadawul All Share Index (TASI) of the Arab world’s largest stock exchange climbed 10.3 per cent this week, closing at 10,127.10 points up from 9,185.07 points last week.

TASI is currently 9.4 per cent lower than the year’s start, according to the weekly report of the Riyadh-based Bakheet Investment Group (BIG).

The report expected the Saudi market to “continue its gradual increase amid easing concerns about negative impact from the trend on international markets.”

Jordanian shares also rebounded this week, propelled by a strong demand on leading stocks, notably the Arab Bank, the Arab Potash Co and the Jordan Phosphate Mines Co.

The all-share price index of the Amman Stock Exchange gained 4.36 per cent this week, closing at 8,086 points from 7,857 points last week, according to the ASE weekly report.

“The market was moved by foreign buying particularly from the Gulf region,” Taher said.

Kuwaiti stocks also extended gains this week supported by strong buying on selective shares as well as profits and dividends announced by leading companies, according the Gulf Invest Co’s weekly report.

Kuwait’s KSE all-share price index went up by 1.48 per cent this week, to close at 13,915 points compared with last week’s close at 13,712 points.

The all-share price index of the United Arab Emirates stock exchanges of Dubai and Abu Dhabi gained 1.7 per cent this week, closing at 6,128 points from 6,026 points last week.

Egypt’s CASE 30 index, measuring the performance of the market’s 30 most active firms, climbed 5 per cent this week, closing at 10,841 points from 10,318 points last week.

Egyptian shares found support from foreign buying that focused on blue-chip stocks, analysts said.