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GCC to attract further gains this week - Analysis

GCC to attract further gains this week - Analysis
Most of the active listed-stocks have reached attractive levels for buying

By: Mahmoud Gamal

Mubasher: The GCC stock markets are likely to see a bullish trend this week on the back of foreign purchasing power.

Foreign investments

Foreign investors have resumed trading on some of the blue-chip stocks listed on the GCC bourses, mainly the banks, as the recent geopolitical situation calmed down, CEO of Mindcraft Consulting Fady Al Ghattis told Mubasher.

Most of the active listed-stocks have reached attractive levels for buying as they are expected to post robust financial results for the first half of 2019, Al Ghattis said.

He projected investors to be cautious this week as most of the global stock markets plunged last Friday after the US job growth jumped in June, lowering hopes to cut federal fund rates.

Image result for saudi financial market

The US-China trade truce

For his part, economist and technical analyst Ibrahim Al Failakawi said that the recent US-China trade truce has boosted the investors’ appetite to trade on attractive stocks in the region.

Technically, Al Failakawi stressed that some of the indices in the GCC markets are likely to see a negative trend in July and August weighed on by profit-taking, including Boursa Kuwait and the Saudi Stock Exchange (Tadawul).

Tadawul

As for Tadawul, the economist Mohamed Al Maimouni said that the Saudi market is anticipating new market-boosting catalysts that set its trend this week.

He expected the market to resume the bullish trend by the end of this month and early August following the second phase of Tadawul’s inclusion into the MSCI emerging market index.

Image result for Kuwait Financial Market

Oil prices

Moreover, economist Mohammed Al Shimmery pointed out that the volatile oil prices amid OPEC’s nine-month extension to output curbs make the current declines in the GCC markets temporary.

He also noted that the Saudi market may break 8,900 points and target 9,000 points, adding that its benchmark Tadawul All-Share Index (TASI) has support at 8,800 points.

Positive expectations

Meanwhile, head of asset management at MENACORP Tariq Qaqish told Mubasher that the GCC stock markets, particularly the UAE’s twin bourses, are expected to revive over the coming weeks on the back of listed-firms financial results for the second quarter of 2019.

 

Translated by: Mai Ezz El-Din