Mixed trend on Gulf bourses last month
On the positive side, Saudi market managed to eke out some gains by the end of September 2011, with Tadawul All Share index adding 2.23 percent in monthly gains
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Most Gulf Cooperation Council (GCC) stock markets ended September on a lower note, led by Bahrain bourse, which shed 7.35 percent of its value by the end of the month.
The market's loss can be attributed mainly to the retreat of the industrial index, which dipped by 38.6 percent during the month, said a research note published by Gulf Investment House. On the positive side, Saudi market managed to eke out some gains by the end of September 2011, with Tadawul All Share index adding 2.23 percent in monthly gains.
All sectoral indices managed to eke out some gains by the end of the month, barring the Banking index which posted a marginal retreat. Heavyweight Petrochemical Industries index posted a 4 percent monthly gains, on the back of the positive performance of all its component stocks.
Similarly, Kuwait Stock Exchange was one of the handful stock markets in the GCC to post monthly gains, as it added 1.46 to its value by the end of the month, as measured by market capitalisation weighted Global General index (GGI). Extensive trading activity was seen during the month of September, on the financial and services stocks. Sectoral gains Advancers were broad based with five out of eight sectors ending the month with gains. However, Kuwaiti market was supported by the financial services sectors with the Banking and Investment sectors adding 2.19 percent and 3.61 percent to their indices values.
The last GCC market to post monthly gains was the Qatari market, with its index marginally growing by 0.50 percent. As for their yield to date performance, all GCC markets had a negative performance by the end of the first nine month of the year 2011, as they ended one of their worst quarters since 2008's crash. Kuwait stock market posted the steepest yield to date decline, shedding 19.28 percent of its value as measured by Global General index (GGI), while KSE Price index suffered a 16.14 percent loss.
Bahrain bourse closely followed, with Bahrain all Share index posting an 18.61 percent decline. On the initial public offering (IPO) front, two IPOs were open for subscription in the GCC during the month of September. In Oman, SMN Power Holding offered a 35 percent stake to investing public starting September 11, 2011. The issue will be open for public subscription for one month, ending October 10, while the shares are scheduled for listing on Muscat Securities Market (MSM) on October 25. The issue price was set at RO3.520 per share, which comprises a nominal value of RO1, a premium of RO2.500 per share and issue expenses of baiza 20 per share.
Meanwhile in Saudi Arabia, Saudi Hail Cement (HCC) offered 50 percent of its capital to the public during the period from September 20 to September 26, at a price of 10 Saudi riyal per share, marking Saudi's third IPO of the year 2011, following Saudi Integrated Telecommunications Company and United Wire Factories Company. HCC's IPO was 227 percent oversubscribed. Aggregate volume of shares traded on the GCC bourse in September 2011, declined by 16.2 percent, while value of shares traded increased by 33.3 percent during the month. Over the next few week, investors are expected to monitor the thrid quarter of 2011 closely prior to taking any new positions in the stock markets.
The breadth of GCC stock markets tilted towards advancers in September 2011, as 288 stocks registered monthly gain, compared to 202 decliners, out of 566 traded stocks. Market capitalisation of the GCC markets combined stood at $705.5 billion, up by $30 billion during the month. Mena markets Elsewhere in the Mena region, the Egyptian market continued to decline, as negative sentiments dominated the trading floor on continued political and economic concerns. EGX30 index retreated by 10.83 percent during September, widening its yield to date losses to 42.07 percent, to be the worst performing stock exchange not only in the Middle East, but also worldwide.
The Jordanian market, as measured by Amman Free Float Index was also a notable loser during the month, shedding 2.2 percent from its value. In the meantime, Tunis Bourse carried on its stellar performance for the fourth consecutive month; with the market's main index TUNINDEX adding 3.75 perc cent in monthly gains. Budget reserves helped Tunisia honour all its financial commitments towards international financial institutions and lenders during the first six months of 2011.