Qatar Stocks Lead Mideast Market Rally as Traders See Bargains

  • Saudi Arabia's Tadawul gains the most in almost five months
  • Egyptian stocks' two-day advance the biggest since May

Qatari stocks surged the most in more than a year as investors saw attractive valuations after this week’s selloff, spurring advances across most equity markets in the Gulf.

Qatar’s QE Index jumped 5.5 percent in its first increase in nine days, and was the best performer among more than 90 gauges tracked by Bloomberg. Dubai’s DFM General Index rose the most in five months as Emaar Properties PJSC gained the most since April. The Bloomberg GCC 200 Index, which tracks the region’s biggest and most liquid companies, added the most since August.

“The valuations are so depressed it doesn’t make sense to sell, especially now when dividend distribution is close," said Nabil Farhat, an Abu Dhabi-based partner at Al Fajr Securities.

The BGCC 200 was trading this week at its biggest discount to emerging-market peers in five years after sanctions that crippled Iran’s economy were lifted, paving the way for increased oil exports from the OPEC producer amid a global glut. Brent crude, a pricing benchmark for more than half the world’s oil, dipped below $28 a barrel on Monday amid a decline that’s pressured government finances across the six-nation Gulf Cooperation Council. The region accounts for about 30 percent of the world’s proven crude reserves.

Bahrain Slump

The Mideast rally is part of a rebound across emerging markets. Brent rose to $29.69 a barrel at 3:35 p.m. in Riyadh, poised for only the second gain this year, even after the International Energy Agency said global oil markets could “drown in oversupply.” In China, speculation of further government stimulus grew as the country’s economic expansion slowed to the weakest level since the 2009 recession.

Ezdan Holding Group led gains in Qatar as it added 7.4 percent, the company’s biggest jump since August. Islamic lender Masraf Al Rayan and Qatar Islamic Bank rose 9.7 percent and 9.6 percent, respectively.

Saudi Arabia’s Tadawul All Share Index climbed 4 percent, the most since August. Kuwait’s benchmark measure increased for the first time in 12 days. Abu Dhabi stocks added 2.5 percent, the most in almost five months.

Volatility in the Tadawul All Share Index is increasing.
Volatility in the Tadawul All Share Index is increasing.

Bahrain’s BB All Share Index bucked regional gains, sliding the most since April to the lowest level since May 2013. The gauge’s 14-day relative-strength index was the only one in the GCC not to drop below 30 on Sunday, a sign to some investors measures across the Gulf were oversold. Bahrain’s RSI closed at 29.5.

Egyptian Rally

Egypt’s EGX 30 Index climbed 2.6 percent, taking its two-day gain to 5.9 percent, the biggest since May. The advance was led by Commercial International Bank of Egypt SAE, which has jumped 6.3 percent in two days. The country’s government plans to sell stakes in some state-run companies and banks, President Abdel-Fattah El-Sisi’s office said in a statement on Monday.

Israel’s TA-25 Index rose 1.2 percent, headed for the biggest jump in a month.

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