Oil Boosts Gulf Stocks

DUBAI — UAE and Qatari shares advanced to their highest levels in almost three weeks as oil held above $70 a barrel and evidence builds that the global recession is ending.

By (Bloomberg)

Published: Mon 31 Aug 2009, 10:51 PM

Last updated: Sun 5 Apr 2015, 9:34 PM

The Dubai Financial Market General Index added 1.9 per cent and Abu Dhabi’s measure gained 0.9 per cent.

Shuaa Capital PSC closed at its highest level since June 29, gaining 15 per cent to Dh1.73. The UAE’s biggest investment bank received regulatory approval to issue new shares, representing 48 per cent of the company, to Dubai Banking Group, in an exchange for convertible bonds.

Qatar’s DSM 20 Index climbed 2.4 per cent to 7,088.17, the highest level since August 11.

Qatar Shipping Co., a marine freight transportation company, soared the most in almost six months, adding 7.9 per cent to 31.3 riyals. The shares jumped 10 per cent in intraday trading, the maximum a stock is allowed to gain or lose on the Doha bourse. The stock has gained 7.2 per cent since announcing on August 24 that it established a new logistics firm.

Barwa Real Estate Co., Qatar’s second-largest property developer, gained the most since August 4, adding 3.6 per cent to 34.6 riyals.

Saudi Arabia’s Tadawul All Share Index fell 0.8 per cent to 5,691.77 at 1:38 pm in the kingdom.

“The backdrop to international markets remains encouraging and the recent US and European corporate results remain good, as well,” Ali Khan, head of cash-equity trading at Dubai-based Arqaam Capital Ltd. wrote in an e-mail. “This is positive for commodities and commodity-based economies.”

Crude closed out last week at $72.74 a barrel, above the levels seen as break-even points for the six countries of the Gulf Cooperation Council, or GCC, which together supply 20 per cent of the world’s oil.

The UAE and Saudi Arabia, the world’s largest holder of crude reserves, must sell oil for an average of about $70 a barrel in 2009 to finance imports and domestic projects, Citigroup Inc. said in November.

Consumer spending in the US rose in July as households took advantage of the government’s “cash for clunkers” program to buy new cars, the Commerce Department said August 28. Employers in the US probably cut jobs in August at a slower pace and manufacturing grew for the first time in more than a year, economists said before reports scheduled for release this week.

The Kuwait Stock Exchange lost 0.1 percent while Bahrain’s measure declined 0.2 pe cent. Oman’s MSM30 Index gained 0.9 per cent.

Qatar’s index traded at 19 per cent of its three-month volume average on Sunday, while Saudi Arabia’s measured at 37 per cent of the average, according to Bloomberg data.