Crude prices bump lifts Saudi shares
An overnight rise in crude oil prices to a fresh five-month peak helped to push the Riyadh stock index slightly higher yesterday, while Qatar secured its third straight day of gains.
The Saudi index edged up by 0.1 per cent as all but two of the 14 listed petrochemical producers rose as Brent contracts traded around US$56 per barrel.
Yanbu National Petrochemical added 0.9 per cent. Shares in the large-cap producer have been active for four sessions, and one Riyadh-based analyst said that investors have been building positions in “relatively safer petrochemical stocks” because of the recent climb in the oil price.
Shares of media conglomerate Saudi Research and Marketing jumped 4.6 per cent after it signed a contract with Bloomberg for an exclusive licence to launch a Bloomberg Arab channel. The contract is for 10 years with an annual licence cost of 33.8 million riyals.
“Local retail investors depend heavily on financial TV programmes for news and analysis, like Alarbiya and CNBC Arabia, so to add Bloomberg in Arabic will mean SRMG is set to benefit from advertising revenue,” said a Saudi-based investment adviser.
In Qatar, the index managed to build positive momentum in the final hour of trade, and added 0.2 per cent. Oil drilling service provider Gulf International Services climbed 3.8 per cent and maritime and logistics company Qatar Navigation added 0.3 per cent.
Shares in the index are now up 1 per cent in three days thanks to local funds ratcheting up their buying and foreign funds slightly easing their selling of Qatari shares, bourse data showed.
Bourses in the UAE, Kuwait, Bahrain and Egypt were closed because of the Islamic New Year holiday.
Meanwhile, emerging stocks and currencies fell yesterday after the US Federal Reserve confirmed it would reverse its stimulus programme from next month and stick to rate hike plans.
On Wednesday, the Fed left interest rates unchanged as expected after concluding a twoday policy meeting, but signalled it still expects one more rate hike by the end of the year.
The move pushed the dollar index to a two-week high overnight and ramped up pressure on many emerging currencies which have seen stellar gains since the start of the year.