- Dubai's DFM General Index rises the most since December 2014
- Stocks in Saudi Arabia increase as much as 6.8 percent
Stocks across Middle Eastern markets surged after oil prices rebounded and global equities rallied.
The DFM General Index climbed 5.2 percent, the most in more than a year, to close at 2,757.08 as traders exchanged 415 million shares, 63 percent above the 12-month daily average volume. Qatar’s QE Index and Abu Dhabi’s ADX General Index climbed 4.6 percent and 2.7 percent, respectively. Saudi Arabia’s Tadawul All Share Index soared as much as 6.8 percent before paring gains to 2.7 percent at the close.
Oil advanced the most since August on Friday, boosting the outlook for the countries of the six-nation Gulf Cooperation Council, for which crude remains the biggest source of revenue. The equity advance also followed Friday’s surge in world stocks, the sharpest rally since June 2012, amid speculation central banks will expand stimulus measures to counter turmoil in financial markets.
“The global rally and oil price recovery is a great signal for investors here to buy,” said Hisham Khairy, the Dubai-based head of institutional trade at Mena Corp. Financial Services LLC, one of the United Arab Emirates’ largest brokerages. “If tomorrow the market opens higher, it would offer a great selling opportunity,” said Khairy, who recommends “exiting the market” because the factors that led to the selloff across the region haven’t been resolved.
Brent crude, a pricing benchmark for half of the world’s oil, soared 10 percent to $32.18 a barrel on Friday. U.A.E. Energy Minister Suhail Al Mazrouei said the same day that he sees prices stabilizing either at the end of this year or the beginning of 2017. The GCC is home to about 30 percent of the world’s proven reserves.
The Bloomberg GCC 200 Index, which tracks some of the region’s top companies, climbed the most since August. Saudi Basic Industries Corp., one of the world’s biggest chemicals manufacturers by sales, was the biggest contributor to the increase, rising 3.5 percent.
Saudi Arabia’s Al Rajhi Bank added 6.5 percent after the board recommended a dividend of 1 riyal per share for the second half of 2015 after the lender posted a 28 percent increase in fourth-quarter profit.
The Tadawul All Share Telecommunications Index advanced 4.2 percent, with Etihad Etisalat Co. rising 10 percent, the most since Nov. 2008, after the company reported first profit after four quarters of loss.
The kingdom may sell shares in Saudi Arabian Oil Co. in an initial public offering, the company, known as Aramco, said this month, after the drop in crude prices strained the nation’s finances. The sale won’t include crude oil reserves, which belong to the state, Chairman Khalid al-Falih told Al Arabiya TV in an interview. Oil prices will recover in the second half of the year as demand grows, he said.
Saudi Arabian Airlines plans to raise as much as 5 billion riyals ($1.3 billion) from the sale of Islamic bonds in the second quarter to refinance loans and buy planes, Director General Saleh Al Jasser said on Friday.
Kuwait’s SE Price Index advanced 0.6 percent and Oman’s MSM 30 Index added 1.5 percent. Egypt’s EGX 30 Index climbed 3.2 percent, and Iran’s TEDPIX Index rose 1.2 percent, according to the Tehran Stock Exchange website. Bahrain’s Bourse All Share Index and the Palestine General Index were the region’s only decliners, retreating 0.6 and 0.3 percent, respectively.
The TA-25 Index increased 1.7 percent at the close in Tel Aviv, the most in more than a month, led by dual-listed health companies tracking gains in their U.S. shares on Friday. Following the rally in oil prices on Friday, the country’s gauge for oil and gas explorers advanced 2.6 percent, the biggest gain in three weeks.