Five factors to control GCC markets this week

Five factors to control GCC markets this week
GCC stock markets are likely to extend gains this week

By: Mahmoud Gamal

Mubasher: The GCC stock markets are likely to extend gains this week on the back of five main factors, including the anticipated initial public offering (IPO) of Saudi Aramco, mergers in the banking sector, and the expected positive quarterly financial results.

By the end of Sunday’s trading session, most of the Gulf markets fell following the below-expectation financial results for the third quarter of 2018, mainly in Saudi Arabia, as well as the plunge in global stock markets.

It is worth noting that the GCC bourses have generated around $8 billion in market capitalisation last week.


Q3 results

The Saudi Stock Exchange (Tadawul) will carry on seeing a wave of profit-taking that lasted for the past two trading sessions, economist Mohamed Al-Maimouni told Mubasher.

He noted that the financial results of Advanced Petrochemical Co for Q3-18 were below expectations, which affected Tadawul yesterday, mainly the petrochemical sector.

The Saudi market will resume the bullish trend if Tadawul All-Share Index (TASI) settled above 7,950 points after the correction movement ends, especially after the announcement of Q3-18 results, Al-Maimouni indicated.

He forecast that Saudi Basic Industries Corp (SABIC) will log nearly SAR 6 billion in profits in line with the improved demand for petrochemicals and the hike in oil prices, which will boost Yanbu National Petrochemical Co’s (Yansab) results above SAR 700 million.

Moreover, the banking sector is expected to witness positive results amid the growing demand for interest rates and the lending portfolio, the economist added.

He projected that Al-Rajhi Bank may achieve profits of around SAR 2.7 billion in Q3-18, whereas Riyad Bank may post about SAR 1.25 billion in profits for the same quarter.


Translated by: Mai Ezz El-Din