Banks boost Saudi market index and decline in other Gulf markets

Shares in Saudi Arabia rose sharply on Sunday, lifted by cheaper valuations and delays in Aramco’s IPO. Shares of financial institutions have mostly suffered in major Gulf markets.

The Saudi market rose 2 per cent and posted gains for a third consecutive session as all bank stocks rose. The largest lender in the kingdom jumped 5.3 per cent in assets, its biggest daily gain since September 2018. Al Rajhi Bank also closed up 7.1 per cent.

The Dubai index fell and recorded continuous losses from the previous session to close 0.5 per cent, and also fell to the largest bank lender, Emirates NBD by 1.2 per cent. On Thursday, the lender posted its biggest one-day decline in nearly eight months after the bank’s board approved a capital increase through a rights issue of 6.45 billion dirhams ($ 1.76 billion), lower than the amount decided by the General Assembly in February. $ 7.35 billion this year.

In Abu Dhabi, the index fell 0.1 per cent, with Emirates Telecommunications Co and Abu Dhabi Commercial Bank losing 0.4 per cent each. But Sharjah Islamic Bank rose 1.7 per cent after posting a nine-month rise in net profit. “The news of the delay in Aramco’s IPO has removed the burden and has given investors the confidence to start buying again,” said Akbar Khan, head of asset management at Al Rayan Investment.

Reuters reported on Friday, citing sources familiar with the matter, that Saudi Aramco had made the initial announcement of its public offer in the hope that third-quarter results would boost investor confidence in the world’s largest oil company. Aramco is expected to announce plans this week for a 1 percent to 2 percent stake in the trading sector, in what would have been one of the world’s largest public offerings, worth more than $20 billion.

In Egypt, the benchmark index increased by 0.2 per cent with CIB rising by 1.4 per cent. Kuwait Holding in Egypt rose to 1.5%. However, Egyptian Citadel fell by 0.8 per cent, although it said it would increase its refining capacity.

The company will increase its refining capacity to 5,500,000 tonnes of oil products per year in 2021 from 4,200,000 now, the company president told Reuters.

Qatar’s index fell 0.2 percent, down 1.6 percent in Commercial Bank and 1.8 percent in Mesaieed Petrochemicals.


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