GCC markets start week mixed as Abu Dhabi and Dubai gain
GCC equity markets started the week on a mixed note with three major bourses - Saudi Arabia, Abu Dhabi and Dubai - closing up while other indices plummeted on Sunday.
The Dubai Financial Market reversed first-hour losses to close 1.3 per cent higher at 1,832 points. Gulfa, Ithmar, Emaar Properties and its subsidiary Emaar Development led the positive trend as investors shrugged off news of global ratings agency S&P putting Emaar Properties and its subsidiary Emaar Malls on negative watch.
The Abu Dhabi Securities Exchange jumped 2.9 per cent to 3,878 points, led by gains in First Abu Dhabi Bank, etisalat, Emirates Driving Company and International Holding Company.
Saudi Arabia's Tadawul All Share Index closed 0.8 per cent higher at 6,376 points. The major regional markets were boosted by $2 trillion US rescue package approved on Friday.
Other regional bourses plummeted due to new coronavirus cases. Investors sentiment was further dented by the first death announcement made by Qatar due to Covid-19. The six-nation GCC has confirmed a total of over 3,000 infections, many related to travel to Iran, and 11 deaths from the virus. Qatar dropped 0.6 per cent to 8,431 points. It had fallen as low as 8,378 points.
Boursa Kuwait slumped 3.4 per cent to 5,101 points. It has lost 27 per cent this year compared to 32 per cent last year. On Sunday, it had lost as much as 4.7 per cent after it was downgraded by S&P by one level to AA-. But S&P maintained its stable outlook. Kuwaiti stocks are expected to be included in MSCI's emerging markets benchmark index in May, which is expected to attract strong foreign investor inflows.
Bahrain fell 1.9 per cent to 1,388 points while Omandropped 1.6 per cent to 3,479 points on Sunday.
Last week, regional equity markets recorded a mixed performance as hopes of government stimulus to boost economic activity was offset by lockdowns to minimise the spread of the coronavirus.
"Going forward, for the regional markets, the trading activity will be largely attributed to movement in oil prices and ability of the governments to contain the spread of the virus. Furthermore, proactive stimulus packages will be supportive of equity markets and calm investor anxiety," said Iyad Abu Hweij, managing director of Allied Investment Partners.