By: Mahmoud Gamal
Mubasher: GCC stock markets are likely to see weekly gains amid investor optimism over listed-firms’ annual dividend distributions.
Most bourses in the Gulf region closed last Thursday in the green territory, topped by Qatar Stock Exchange (QSE), Abu Dhabi Stock Exchange (ADX), and the Dubai Financial Market (DFM), while the Saudi Stock Exchange (Tadawul) fell slightly.
Trade war
It is likely that GCC markets will see further gains this week, especially after US president Donald Trump announced delaying tariffs on China, CEO of Mindcraft Consulting Fady El Ghattis told Mubasher.
On Friday, Trump said that the US-China trade war would come to an end as he had agreed with Chinese President Xi Jinping to extend the 1 March tariff deadline.
This step has positively affected global oil prices that hovered around $70 last week, and in return pushed investors to resume trading in GCC markets, El Ghattis indicated.
The US Federal Reserve could raise interest rates again this year to provide full support to the banking sector’s stocks which impact global institutions in the Gulf region, mainly in the UAE, he added.
The CEO of Mindcraft Consulting further noted that the US stock market has marked an eight-week high, which will boost investors’ optimism in the GCC.
Attractive stocks
For his part, head of asset management at MenaCorp Tariq Qaqish said that the UAE’s twin bourses have been the most attractive in the region for investors lately.
UAE-listed stocks are expected to see extend gains amid the domestic optimism over their robust annual results, Qaqish added, indicating stock such as Emaar Properties added to Morgan Stanley's recently raise of the stock’s valuation.
He projected that markets would maintain the bull-run this week on the back of the consecutive announcement of firms’ annual dividend payments and the recent expectations by Standard & Poor's regarding the stability of the banking and real estate sectors.
Positive performance
Economist and technical analyst Ibrahim Al-Failakawi, agreed with the El-Ghattis and Qaqish in that GCC bourses were likely to see positive gains this week, particularly blue chips.
He attributed the recent positive performance to the 2018 financial results as well as cash dividend payouts. He added that Kuwait Finance House’s (KFH) acquisition of Ahli United Bank – Bahrain (AUB - Bahrain) has boosted optimism among investors in Boursa Kuwait and the Bahrain Bourse.
New IPO
Economist Mohamed Al-Maimouni forecast that Tadawul, the DFM, and ADX will attract more foreign investors on the back of new initial public offerings (IPOs).
It is worth noting that Arabian Centres Company Ltd, owned by Saudi-based Alhokair Group, revealed it was looking to raise $1 billion from its IPO in the second quarter of 2019.
Al-Maimouni further noted that the recent international visits of the Saudi Crown Prince Mohammed bin Salman to India, China, Pakistan will attract investments to the kingdom’s major firms and the stock market.
Translated by: Mai Ezz El-Din
