GCC stock markets surge to 16-month high

Positive sentiments across financial markets globally pushed the GCC market index to the highest level since November 2022 during the third week of February.

The MSCI GCC Index remained elevated by the end of the month and closed after receding marginally in the last week with gain of 4.2%, according to Kuwait-based Kamco Investment. The positive performance came despite three out of seven stock exchanges in the GCC witnessing declines during February. The monthly gains also fully offset the declines during January resulting in a year-to-date gain of 3.3% for the MSCI GCC Index, Kamco Investment said in a research report on Sunday.

Saudi Arabia was the best performing market during February with a gain of 7.1% followed by Qatar and Dubai with gains of 3.8% and 3.4%, respectively. Kuwait’s market also showed a gain of 2.4%.

On the decliner’s side, Bahrain reported the biggest decline during the month (-3.0%) followed by Abu Dhabi and Oman with relatively smaller declines.

In terms of year-to-date 2024 performance, Kuwait topped the GCC chart with a return of 9.1% followed by Dubai and Saudi Arabia with returns of 6.1% and 5.5%, respectively. On the other hand, the decline in the Abu Dhabi benchmark for the second consecutive month steepened the year-to-date fall to 3.4%.

The sector performance for the GCC showed a broadbased growth in all sectors with the insurance index at the top with a gain of 19.5% followed by consumer durable and apparel and healthcare indices with gains of 12.6% and 11.4%, respectively.

Large-cap sectors like energy and banks showed lowsingle digit gains of 3.5% and 3.8%, respectively. Healthcare and insurance also featured in the top five sectors by year-to-date performance with double-digit returns, according to the report.

In terms of trading activity, value traded during February declined month-on-month basis but remained elevated at the second-highest level in 21 months.

The Muscat Stock Exchange’s MSX30 Index registered a marginal decline of 0.2% during February to close the month at 4,554.8 points as compared to a gain of 1.1% in January. The index traded in a tight range during the month mainly led by minimal catalysts in the market, Kamco Investment said.

In terms of sectoral performance, two out of the three sector indices on the MSX recorded gains during February while one declined. The Financial Index recorded a decline of 3.7% during February mainly driven by a decline in shares of more than half of the companies in the sector.

In comparison, the Services Index of the Omani bourse registered a 10.4% monthly gain during February, while the Industrial Index witnessed a gain of 2.2%.

Trading activity on the Muscat Stock Exchange witnessed strong gains during February. Total volume of shares traded in the exchange surged by 132.7% to 860.3mn shares during February as compared to 369.6mn in January. Similarly, total value traded in the exchange increased by 51.4% to RO103.8mn against RO68.6mn in January.

Japan's chip-related Socionext and Disco will be added to the Nikkei share average next month in a regular reshuffle of the benchmark index, the publisher of the stock average said on Monday. Those chip stocks will replace Sumitomo Osaka Cement, Pacific Metals and Takara Holdings, the Nikkei said.

The Nikkei 225 breached the 40,000 level for the first time on Monday to a record high and posted a 19% gain so far this year. The gains were mainly fuelled by chip-related stocks, such as Advantest and Tokyo Electron.

Both Socionext and Disco outperformed the Nikkei's annual gains, rising 55% and 47%, respectively.

Equity markets took a knock from a retreat from record highs on Wall Street on Monday, as the U.S. Federal Reserve showed no signs of being in a rush to cut interest rates. U.S. stock futures also pointed lower.

Meanwhile, bitcoin hit a two-year peak of $68,828, just a whisker from a new record, while gold hovered around $2,100 an ounce, near an all-time high of its own.