Gulf investors are unlikely to offload huge assets abroad after last week's attacks in the United States sent world markets into a tailspin and sparked fears of global recession, bankers and analysts said Tuesday.
They said some investors from the region were eyeing bargain US stocks, while others were looking to European markets, but few were expected to bring their funds back home, reported the Gulf Daily News.
"Gulf investors are not speculators. They are long-term investors who have seen many economic downturns and upturns," Saud Al Saleh, general manager of Saudi Investment Bank, told the paper.
The biggest vote of confidence in the US economy came on Monday from Saudi Prince Alwaleed bin Talal as US markets re-opened Tuesday.
"It would be very foolish and a big blunder to sell at this time. With deep regret for all that has been going on, there is a great opportunity to buy," said the prince.
"Those with a five to 10-year horizon, if they invest today they will not be sorry," added the prince, famed for high-profile international investments in media, banks, hotels, autos, real estate and technology.
Saeed Al Sheikh, chief economist at Saudi Arabia's National Commercial Bank, said that any migration of Gulf investment from US markets would benefit Europe and Asia.
"Some might come to the local stock market, but not a significant amount because the regional market is not big enough," Sheikh said.
The biggest markets in Saudi Arabia and Kuwait fell by 7.2 and 8 percent, respectively, since the attack but a Kuwait Central Bank interest rate cut triggered a four per cent rally Tuesday, brokers said.
The Central Bank of Kuwait cut its discount rate Tuesday by half a percentage point to 4.75 percent – Albawaba.com
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