GCC markets make inroads this summer
The stock markets in the Gulf Cooperation Council (GCC) rose in July, gaining 0.41 per cent after a decrease of 2.91 per cent in June, according to Kuwait Financial Centre's (Markaz) latest update on regional markets.
Kuwait, Bahrain and Oman bourses were in red while others ended the month in positive territory. Oman was the largest loser shedding 5.72 per cent for the month; followed by Bahrain which lost 2.46 per cent. Dubai has been the best performing market year-to-date, with a gain of 13.63 per cent. Saudi (TASI) gained 1.68 per cent in July while Qatar and Abu Dhabi gained 1.89 per cent and 1.94 per cent respectively.
The Saudi Arabian economy is predicted to witness an average growth rate of 5.3 per cent in the current year, which will have a positive impact on the oil and non-oil sector and curb inflation, according to a report released by the Riyadh Chamber of Commerce and Industry.
Mobile Telecommunications (Zain Group) has increased its shareholding in Zain to 37.045 per cent through participation in Zain's rights issue which was oversubscribed by 105.4 per cent. Zain lost 24.69 per cent in July and closed at 11.80 Saudi riyals.
Saudi Basic Industries (Sabic) and ExxonMobil Chemical said that their new rubber joint venture will start up in the second half of 2015 with an immediate impact on the companies' earnings. Sabic lost 4.03 per cent in July and closed at 89.25 Saudi riyals. Low-cost carrier Air Arabia, posted over 15 per cent year-on-year second quarter gain in passenger volumes driven by network expansion and cheap fares. The company gained 5 per cent in July and closed at Dh0.63.
Volume decreased 8 per cent month-on-month in the GCC and value traded increased 1 per cent to $37.8 billion. This was on the back of 36 per cent MoM drop in volumes and 24 per cent decrease in value traded in June. Saudi Arabia, which accounted for 50.26 per cent of GCC's total volume traded, witnessed a two per cent MoM increase in value traded. Positive statement coming from Mario Draghi near the month end and his attempts to build consensus among governments, caused a global market rally near the month end.
Major indices ended on a positive note apart from India BSE, Nikkei 225 and Shanghai SEA which closed on a negative note. Frontier Markets ended on a slightly positive note for the month. CBOE VIX increased 5.56 per cent during the month signalling increased volatility. The CRB commodity index increased by 2.29 per cent at the end of the month.