Why Gulf stock exchanges returned to rise strongly? Analysts answer

Mahmoud Jamal – Mubasher: Gulf stock exchange indices recorded strong increases at the close of trading on Wednesday, coinciding with traders continuing to carry out selective purchases of major stocks that are expected to announce strong quarterly business results and the spread of reports confirming moving forward in lifting some sanctions against Russia in exchange for the continuation of some sanctions against Russia. Pumping gas to Europe to help in partly fading the repercussions of the Ukrainian war, despite the continuing fears of rising inflation and the repercussions of raising interest rates.

At the end of trading today, Wednesday, the Saudi market index rose by 0.88 percent, reaching the level of 11,864.34 points, to give up at the close of the level of 12,000 points, with Aramco’s share increasing by more than 0.5 percent, and the rise of Al-Rajhi Bank’s share by 2.8 percent.

The Kuwait Stock Exchange rose 1.35 percent, with Agility shares adding 4.2 percent and Industries 3.05 percent.

The Qatar Stock Exchange increased by 3.37 percent, with the shares of Investment Holding and Gulf International rising by 9.9 percent for the first and 7.9 percent for the second.

The Muscat market index rose 0.96 percent, with the share of Dhofar Electricity Generation rising 7.8 percent and the National Bank of Oman 3.4 percent, and the Bahrain Stock Exchange rose by 0.73 percent, with the share of Al Ahli United rising 2.79 percent.

Analysts told “Mubasher Information” that the Gulf markets rose, most of them today, affected by the rise of global markets, which are witnessing a positive rebound, and most of its indicators recorded their highest levels in more than a month, after a report stating that Russian gas flows to Europe resumed on time through the “Nord Stream 1” pipeline. Specific, to ease some concerns related to the energy supply crisis on the continent, noting that the expected decision to raise interest rates could slow the continued rise in the region’s markets next week.

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In this regard, a member of the Saudi Economic Association and economic analyst Saad Al Thaqafan said that the rises witnessed by the Gulf financial markets today came with the support of the rise of their global counterparts, especially the American market, which witnessed yesterday strong increases of more than 2%, as well as the return of oil prices above $100, as well as Positive news from the profits of some companies that came higher than expectations, which gives an indication to investors of the positive profits of other companies in the same sector, as well as the announcement of some of the companies for cash dividends.

For his part, Ibrahim Al-Failakawi, an expert in stock markets, indicated that what is happening is a temporary positive interaction that may extend for a week, coinciding with the necessity of technically rebounding the indices of the region’s stock exchanges with news of the completion of mergers between banks, in addition to reports indicating the possibility of lifting sanctions on Russia and from Then the resolution of the current crisis with Ukraine.

In turn, Mahmoud Atta, an expert in stock investment, suggested to “Mubasher Information” that the markets would return quickly to some cautious movements, starting next week, with the approaching date of the US Federal Reserve meeting, amid investors’ assessment of the US Central Bank’s decision to raise interest rates, whether it will be about 75 basis points or 100 points. basis, which will affect the market movement later after completing the current temporary rebound this week.

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For her part, Hanan Ramses, an expert in financial markets, explained that the financially strong and low stock prices had an impact on the return of the formation of investment centers in many sectors, in addition to the Arab agreement with the United States and finally the successful acquisitions, and the return of completing plans to offer government and semi-governmental companies, whose impact will continue. Positive effect on the financial markets in the region.

In turn, Mina Rafiq, director of research at Al-Marwa Securities Brokerage Company, told Mubasher Information that today’s rises came after a wave of violent declines in financial markets since the start of Russian-Ukrainian tensions and the tendency of central banks to raise interest rates, which negatively affected investors’ appetite for risk. Share prices of most companies fell to low levels that do not reflect the fair values ​​of these companies.

He pointed out that with the start of the season of corporate business results during the first half of this year, the initial indicators of most of these companies, especially the banking sector and the basic materials sector, showed that they were not affected by events and achieved strong positive growth rates, and with the desire of institutions and companies to seize the opportunity of declines to complete acquisition deals. Which paves the way for the rise of the financial markets in the region once again.

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