GCC index remains elevated on strong earnings

Business Saturday 07/May/2022 17:28 PM
By: Times News Service
GCC index remains elevated on strong earnings

Muscat: GCC aggregate index once again reported gains during April-2022 backed by solid earnings reported by large-cap stocks on the exchange, especially banks, according to a new report.

“Nevertheless, monthly gain decelerated slightly during the month to 3.3 per cent for the aggregate MSCI GCC Index, the smallest monthly gain after five consecutive months of growth,” the Kuwait-based Kamco Invest said in its monthly GCC markets report.
Dubai was the top-performing market in the Gulf Cooperation Council (GCC) during the month with a monthly gain of 5.5 per cent followed by Saudi Arabia and Kuwait with gains of 4.9 per cent and 2.6 per cent, respectively, the report said.

On the other hand, Muscat and Bahrain reported declines during the month of 1.1 per cent and 0.8 per cent, respectively.

In terms of year-to-date-2022 performance, Saudi Arabia regained the top spot with a gain of 21.7 per cent followed by Abu Dhabi and Kuwait with gains of 18.8 per cent and 18.75 per cent, respectively.

On the sectoral front, however, the monthly performance was not broadly positive. The performance was almost equally split between gainers and losers, but the monthly gain was mainly led by the positive performance of large-cap sectors like Banks, Energy and Real Estate.

These gains more than offset a drop mainly in Insurance, Consumer Durables and Pharma indices. Banks also outperformed since the start of the year with a gain of 26.5 per cent followed by Healthcare and Capital Goods with gains of 23.2 per cent and 21.8 per cent, respectively.

Globally, markets witnessed a steep correction as a result of the looming rate hike decision.

Consensus estimates suggest the biggest rate hike by the US Fed since 2000 by 50 bps and keep the door open for similar hikes for the rest of the year.

The Bank of England (BoE) also indicated hiking rates to a 13-year high. As a result, US Treasuries extended declines with the yield on 10-year bonds going above 3 per cent.
Crude oil traded within a tight range as supply threats from actions against Russia were countered by demand decline due to lockdowns in China.

Muscat Securities Exchange
After showing healthy growth during March-2022, Oman’s MSX index recorded the biggest monthly decline in the GCC during April-2022 with a fall of 1.1 per cent to close the month at 4,158.37 points.

In terms of sectoral performance, the Financial index fell 2.4 per cent during April-2022 to reach 6,600.6 dragging down single-handedly the gains witnessed by the other two indices.

The Industrial index witnessed a 1.9 per cent uptick during April-2022 reaching 6,112.9 points while the Services index showed a gain of 1.2 per cent during the same period.
Monthly trading activity on the exchange decreased during the month after witnessing a significant improvement during the previous month.

The total volume of shares traded during April-2022 was down 37.7 per cent to reach 522.1 million shares as compared to 838.1 million shares during March-2022. Monthly value traded also witnessed a fall of 46.3 per cent to reach OMR 90.4 million.

Boursa Kuwait
Boursa Kuwait continued to record gains for the fifth consecutive month during April-2022 with all the four benchmark indices witnessing gains during the month. Gains were mainly led by large-cap stocks with the Premier Market index outperforming other indices on the exchange with a gain of 2.7 per cent to close at 9,308.0 points.

On the other hand, the Main 50 index reported a slightly smaller monthly growth of 1.4 per cent and closed at 6,674 points. The Main Market index witnessed a monthly growth of 2.2 per cent resulting in a net impact of 2.6 per cent for the All Share Index. In terms of YTD-2022 returns, the Premier Market Index continued to show the biggest gain of 21.8 per cent followed by an 18.7 per cent gain for the All Share Market Index.

Saudi Arabia (Tadawul)
Saudi Exchange reported its fifth consecutive month of gains during April-2022 buoyed by a combination of factors, including robust economic recovery, higher oil prices, strong corporate profitability as well as buoyant primary market activity during the month with the listing of a new company, Saudi Home Loans Company, in the Banking sector.
The TASI index reported a gain of 4.9 per cent during the month, the second-highest in the GCC, to close at the 13,733.9 mark. The monthly gain pushed the year-to-date-2022 gains to 21.7 per cent, the highest this year in the GCC.
The sector performance chart remained mixed during the month and was almost equally split between gainers and losers.

Abu Dhabi Securities Exchange
The FTSE ADX index increased only marginally during April-2022 registering a 1.3 per cent monthly growth to close at 10,081.35 points. In comparison, the exchange’s market cap increased by 4.5 per cent during the month to reach AED1.9 Trillion due to an increase in the share price of some high market cap companies such as International Holding Company which witnessed a 15.9 per cent rise in its share price during the month.
The ADX benchmark was the second-best performing market in the GCC in terms of YTD-2022 performance with a gain of 18.8% at the end of April-2022.

Dubai Financial Market
The DFM General Index reported the best performance in the GCC from April-2022. The benchmark gained 5.5 per cent during the month closing at 3,719.63 points.

The monthly index performance was supported by gains in eight out of nine sectoral indices including large-cap sectors such as Banks, Real Estate and Telecom sectors.
The listing of Dubai Electricity and Water Authority (DEWA) which raised AED22.4 billion ($6.1 billion), the largest IPO in the region since Aramco, has been instrumental to the gain in the index during April-2022.

Qatar Exchange
Qatar’s QE-20 index witnessed marginal gains during April-2022 at 0.4 per cent to close the month at 13,590.8 points. Gains for the broader Qatar All Share Index were slightly better at 0.8 per cent in April-2022.

With the gains in April-2022, the year-to-date-2022 growth for the QE 20 index reached 16.9 per cent while the Qatar All Share Index registered a higher growth of 18.0 per cent at the end of April-2022 with relatively better performance during the last few months.

Bahrain Bourse

After four consecutive months of gains, Bahrain Bourse was the second-worst performing market during the month in the GCC with the All Share Index recording a decline of 0.8 per cent during April-2022 to close at 2,056.15 points.

Trading activity was mixed during the month with an increased volume traded but a decline in monthly value traded. Volume traded was at a five-month high at 73.8 million shares in April-2022 as compared to 24.0 million shares traded during March-2022.