Kuwait and Qatar Shares Advance on Bernanke's Comments; Dubai Index Falls
Kuwait and Qatar shares led gains among Gulf Arab markets as Federal Reserve Chairman Ben S. Bernanke said the U.S. economic recovery remains intact.
Kuwait Finance and Investment Co., an investment banking and asset management company, jumped the most since March 11. Burgan Bank SAK, the Kuwaiti lender, rose the most in more than three months. Qatar Telecom QSC, the country’s biggest phone- service provider, rose 2.4 percent. The Kuwait Stock Exchange Index gained 0.9 percent, the biggest advance since May 10, to 6,723.4. Qatar’s QE Index rose 0.9 percent and the Bloomberg GCC 200 Index of 200 companies in the Gulf gained 0.4 percent.
Bernanke is “stating the reality, and if investors are prepared to react to the statement accordingly then that’s a good sign,” said Paul Cooper, managing director at Sarasin- Alpen & Partners Ltd. in Dubai, which manages more than $500 million in the Middle East.
The recovery in the world’s largest economy is “moderate- paced” and Europe’s policy makers “are committed to avoiding default in Greece” and elsewhere, Bernanke said during a question-and-answer session yesterday with ABC News in Washington. U.S. stock-index futures gained.
‘Ideal’ Crude Prices
Crude oil will likely remain near its “ideal” price of $75 a barrel, Saudi Arabian Oil Minister Ali al-Naimi said in an interview on May 18 with consultants Petroleum Policy Intelligence. The six Gulf Cooperation Council countries, including Kuwait and the United Arab Emirates, hold about 40 percent of global proven oil reserves, according to data compiled by Bloomberg.
Crude for July delivery gained 0.3 percent to $71.62 a barrel on the New York Mercantile Exchange at 5:17 p.m. in Dubai.
“It’s good to remind people that this region can generate budget surpluses very easily if oil is at around about $75 a barrel,” Cooper said.
Kuwait Finance and Investment soared 7.1 percent to 75 fils after the company reached an accord with all its lenders to restructure 145 million dinars ($495 million) of debt over a five-year period. Burgan Bank rose 8.3 percent to 325 fils. The bank’s shareholders approved selling as much as 140 million dinars of bonds.
Qatar Telecom gained 2.4 percent to 154.8 riyals.
Oman’s Muscat Securities Market 30 Index and Bahrain’s gauge rose 0.4 percent, while Saudi Arabia’s Tadawul All Share Index advanced 0.2 percent. The DFM General Index slipped 0.3 percent and Abu Dhabi’s index lost 0.2 percent.