Dubai and Tadawul give Gulf a boost

Arabian Gulf markets mostly gained on Thursday, led by Dubai, which was carried upward by renewed buying of shares in heavyweight Dubai Islamic Bank, and Saudi Arabia.

The Dubai index closed up 1.9 per cent, with gains led by a 5.9 per cent spike in DIB shares in heavy trade to Dh5.07 following the last day of trade in the bank’s rights issue, which allowed purchases of DIB shares at Dh3.11.

Investors had been selling DIB stock to buy the rights before the Wednesday deadline, contributing to its 13 per cent decline this year.

The Abu Dhabi index rose 1.1 per cent.

Middle East fund managers are now more bullish on UAE equities than Saudi equities for the first time in eight months, following months of outflows from Dubai and Abu Dhabi bourses to Riyadh. Saudi Arabia’s Tadawul index likewise rose 1.9 per cent, pulled up by Saudi Basic Industries Corporation, the largest company on the bourse.

The petrochemicals company jumped 4.3 per cent on a minor rebound in the oil price and enthusiasm related to the Tadawul’s upcoming inclusion in the MSCI emerging markets index, reaching a four-year high.

Financial blue chips National Commercial Bank, Samba and Banque Saudi Fransi were also among the market’s biggest gainers.

Elsewhere, markets were mixed, with Bahrain’s BB All Share up 0.4 per cent, Oman up 0.2 per cent and Qatar’s index down 0.4 per cent.

Outside the Gulf, Egypt’s benchmark index sank 2.1 per cent, weighed down by electric cable company El Sewedy Cables, down 3.6 per cent, and Misr Fertilizers, down 2.9 per cent. Meanwhile, strong manufacturing data from China and receding angst over Italy’s political crisis helped emerging stocks snap a two-day losing streak on Thursday, while currencies fared more mixed despite a softer dollar.

MSCI’s emerging market index rose 1 per cent – its biggest daily gain in three weeks – with Asian heavyweight Hong Kong and mainland China stocks up 1.5 per cent or more.

The gains came after data from China showed growth in its vast manufacturing sector accelerated strongly and well above forecasts in May to an eight-month high, easing concerns about an economic slowdown in the world’s second-largest economy.