GCC bourses' losses exceed $15bn after KSA starts anti-corruption probe

GCC bourses' losses exceed $15bn after KSA starts anti-corruption probe
GCC bourses lose more than $15bn after KSA starts anti-corruption probe

By: Mahmoud Gamal

Mubasher: The GCC stock markets suffered large losses that exceeded $15 billion after Saudi Arabia started anti-corruption crackdown, which led the leading stocks to drop.

The Dubai Financial Market (DFM) and the Abu Dhabi Securities Exchange (ADX) losses reached $5.64 billion, Boursa Kuwait’s losses amounted to $5.4 billion, and the Qatar Stock Exchange (QSE) losses stood at $4.44 billion.

On the other hand, the Saudi Stock Exchange (Tadawul), and Bahrain Bourse gained $1.19 billion, and $360 million, respectively.

The Saudi authorities arrested 11 princes, four current ministers, number of former ministers, businessmen including Alwaleed bin Talal accusing them of corruption.

On Thursday, the DFMGI fell 4.8% to reach 3,449.81 points, registering its lowest level in three months, while the ADX decreased 2.15%, reaching 4,369.09 points, registering its lowest level in a month.

On Thursday, Reuters stated that the Central Bank of the UAE requested that Emirati banks to provide more information regarding accounts of 19 Saudi citizens, and one of those is Alwaleed bin Talal, the chairman Kingdom Holding Company (KHC).

Geopolitical tensions

On Thursday, Boursa Kuwait declined 4.43%, closing at 6,258.47 points.

The geopolitical tensions that occurred led most of foreign investment portfolios to exit from the GCC bourses, especially Kuwait, analyst Ibrahim Al Filkawy said.

One of the main reasons is the media which said that there will be war in the coming time, Al Filkawy added, noting that this is not the truth.

The QSE levelled down 3.2% to reach 7,885.5 points, registering its lowest level in more than seven years.

Investors in the GCC are awaiting Tadawul’s performance, as if it dropped down 6,900 points, it may suffer more losses and declines in the coming sessions, Al Filkawy indicated.

Sale of leading stocks impact investors' confidence, morale

The GCC bourses’ decline was attributed to selling most of stocks, which affected investors confidence and morale, technical analyst at the African Economic Council Mona Mostafa said.

On Thursday, Tadawul All Share Index (TASI) inched down, closing at 6,954.38 points.

The stability of Saudi bourse was attributed to support of some governmental funds, Mostafa added, forecasting that the negative impacts will end in the coming sessions.

On the other hand, the Muscat Securities Market (MSM) edged up 0.3%, closing at 5,055.24 points.

Translated by: Mohamed Hesham Azab