Kuwait leads GCC markets with 7.5% gain in Q1-2024

Heavyweight sectors drag down GCC index into the red

KUWAIT CITY, April 1: GCC equity markets underperformed a sustained rally in global markets during March-2024 with most markets in the region seeing low single-digit declines. As a result, the MSCI GCC index dropped by 3.0% during the month. The decline was mainly led by seasonal selling pressure during the month of Ramadan as investors booked profits after last month’s healthy gains. Bahrain was the best performing market during the month with a gain of 1.9% closely followed by Oman that was up by 1.8%.

On the decliner’s side, Qatar was the biggest decliner with a fall of 6.0%. Saudi Arabia was next with a decline of 1.8% while Kuwait and Dubai indices declined by 1.5%. All these top decliner’s were the best performing markets last month.

In terms of YTD-2024 performance, the MSCI GCC index was up marginally by 0.2% during Q1-2024 after gains during February-2024 were almost fully offset by declines during the remaining two months. Kuwait continued to lead in the GCC with a Q1-2024 gain of 7.5% followed by Dubai and Saudi Arabia with gains of 4.6% and 3.6%, respectively. On the decliner’s side, Qatar’s DSM index topped with a steep decline of 9.1% followed by Abu Dhabi General Index that declined by 3.7% during Q1-2024.

The decline also reflected a fall in large-cap sectors during the month. This included Telecom, Banks and Energy with low single-digit declines. The sectoral decliner’s chart was topped by Pharma & Biotech sector with a fall of 9.6% followed by Hotels & Leisure that slid 8.1%. Telecom and Banks showed declines of 3.5% and 3.3%, respectively. On the gainer’s side, Utilities topped with a healthy gain of 7.1% closely followed by Insurance and Diversified Financials with gains of 6.8% and 6.3%, respectively.

Boursa Kuwait

Kuwaiti benchmarks receded during March-2024 following a broad-based decline that affected most sectors on the exchange. In terms of market segments, the Main Market Index witnessed the biggest monthly decline of 1.7% as the performance of constituent stocks in the index were skewed downwards. The Premier Market Index and the All-Share Market Index reported a monthly decline of 1.5%, respectively, while the Main 50 Index receded 1.4% during the month. The performance in Q1-2024 also reflected relatively better performance of Premier market stocks with a gain of 7.5% while the Main Market and Main 50 index showed smaller gains of 7.5% and 7.1%, respectively. The broader All Share index witnessed a gain of 7.5% during Q1- 2024, the biggest in the GCC.

The sector performance chart remained mixed during the month. The gainer’s side was topped by the Consumer Staples index with a gain of 8.0% followed by Consumer Discretionary and Industrials indices with gains of 5.1% and 3.0%, respectively. On the other hand, the Health Care Index witnessed the steepest decline of 29.3%, followed by the Technology and Telecommunications indices with declines of 6.1% and 4.7%, respectively. Gains in the Consumer Discretionary index was led by a sector-wide gains with only a few small cap stocks seeing declines. Within the Consumer Discretionary sector, shares of Kuwait National Cinema Co. and IFA Hotels & Resorts Co. were up 20.0% and 18.1%, respectively. IFA Hotels & Resorts Co. announced a record net profit of KWD 13.9 Mn for FY-2023 vs. KWD 2.9 Mn in FY-2022 supported by net income from the sale of properties which increased by KWD 3.6 Mn. Large-cap indices like Banking sector index was down during the month after shares of most the Kuwaiti banks declined despite posting strong quarterly earnings indicating seasonal weakness and profit booking on elevated prices. Meanwhile, both the constituents in Health care sector, Al-Maidan Clinic for Oral Health Services Co. and Advanced Technology Co. declined by 42.4% and 0.2%, respectively. In the Telecom sector, all the 5 constituent stocks declined with shares of Ooredoo Kuwait leading with a fall of 15.6%.

In terms of monthly stock performance, National Real Estate Co. topped with a gain of 27.0% followed Tamdeen Investment Co. and Kuwait National Cinema Co. with gains of 26.1% and 20.0%, respectively. On the decliner’s side, Al-Maidan Clinic for Oral Health Serv. Co. topped with a decline of 42.4% followed by The Energy House Co. and Al-Argan International Real Estate Co. with declines of 37.8% and 32.1%, respectively. In terms of trading activity, volume traded declined by 26.4% to reach 3.4 Bn shares in March-2024 as compared to 4.7 Bn shares in February-2024 due to the month of Ramadan. The aggregate value of shares traded during the month also declined by 23.1% to reach KWD 897.8 Mn.

Saudi Arabia (Tadawul)

Saudi Arabia’s headline equity index TASI reported monthly decline during March-2024. The benchmark hit a 21-month high closing level on 21-March-2024 at 12,835.65 points but consistent declines towards the end of the month pulled the index down below the 12,500 mark to close at 12,401.6 points, witnessing a monthly decline of 1.8%. Despite the decline, Saudi Arabia YTD-2024 performance recorded a gain of 3.6%. In terms of primary market activity, the month saw the third listing during this year with the Modern Mills for Food Products Co. listed in the Food & Beverages sector.

The Utilities index reported the biggest monthly gain of 14.6% following a gain of 23.9% in shares of ACWA Power. The Insurance index was next with a gain of 8.4% followed by Financial Services index with a gain of 8.3%. Gains for the Insurance sector was mainly led by double-digit gains of 38.5% in shares of Gulf Union Cooperative Insurance Co. further supported by gains of 35.1% and 27.5% in shares of The Mediterranean and Gulf Insurance and Reinsurance Co. and Al Rajhi Co for Co-operative Insurance, respectively, whereas shares of Malath Cooperative Insurance Co. declined by 7.9%. In terms of sectoral decliners, the Consumer Services index topped with a fall of -11.3% followed by Pharma, Biotech & Life Science and Telecommunication Services indices with declines of 9.9% and 6.7%, respectively. Large-cap sectors like Banking and Energy sectors reported decline during the month at 4.9% and 2.7%, respectively. Shares of six out of ten banks reported declines during March-2024. Largecap banks like Al Rajhi Bank dropped by 7.5% while shares of Riyad Bank and SNB dropped by 5.5% and 5.1%, respectively. On the other hand, shares of The Arab National Bank gained 4.8% during the month.

The monthly stock performance chart was topped by Saudi Cable Co. with a gain of 46.5% followed by Saudi Steel Pipe Co. with a gain of 39.0% and Gulf Union Cooperative Insurance Co. with a gain of 38.5%. On the monthly decliner’s chart, Al-Ahsa Development Co. topped a decline of 29.3% followed by Alkhaleej Training and Education Co. and National Company for Learning and Education with declines of 25.0% and 22.3%, respectively. Trading activity on the exchange improved during the month. Total volume traded during the month increased by 12.8% to reach 8.4 Bn traded shares in March-2024 as compared to 7.4 Bn traded shares during February-2024. Value traded during the month reached SAR 197.0 Bn during March-2024 as compared to SAR 186.4 Bn during the previous month, resulting in a m-o-m growth of 5.7%.

Abu Dhabi Securities Exchange

The FTSE ADX index recorded a marginal 0.3% decline during March-2024 continuing its declining trend in 2024 to close the month at 9,228.09 points. The decline also steepened the fall in terms of YTD2024 performance that reached -3.7%, the second-biggest in the GCC and the only other declining market along with Qatar. The performance of the ten sector indices on the ADX was evenly balanced as five indices recorded declines during the month while the remaining five witnessed gains. The Consumer Discretionary index posted the largest fall among the indices during March-2024 with a decline of 3.0% to close the month at 6,645.6 points. The decline was led by the fall in prices of Abu Dhabi National Hotels Company, which witnessed an 3.3% fall in its share prices during the month. The Industrials index recorded the second-largest monthly fall during March-2024 with a 1.9% drop to close the month at 2,911.7 points. On the other hand, the Consumer Staples index witnessed a 10.8% gain during the month, the largest gain among the indices in the exchange, followed by the Basic Materials Index which recorded a 6.5% increase during the similar period. Agthia Group’s 12.2% share jump was the main driver of the Consumer Staples Index growth during the month.

In terms of monthly stock performance, Fujairah Building Industries topped the monthly gainers chart for March-2024 with its share price increasing by 32.0% followed by Abu Dhabi National Takaful and Gulf Medical Projects which recorded gains of 23.3% and 16.4%, respectively. Abu Dhabi National Takaful disclosed a net profit of AED 103.0 Mn for FY-2023 as compared to AED 66.7 Mn. On the decliner’s side, Ras Al-Khaimah National Insurance lead the way registering a 10.0% fall in its share price during March-2024 followed by Oman & Emirates Investment Holding and United Arab Bank which saw share price declines of 9.8% and 8.5%, respectively.

Trading activity on the exchange fell during March-2024. Total volume of shares traded declined by 12.6% in March-2024 to reach 4.4 Bn shares as compared to 5.0 Bn shares during the previous month. On the other hand, the total value of shares traded recorded a decline of 3.9% to reach AED 17.8 Bn during March-2024 as compared to

AED 18.6 Bn in February-2024. Eshraq Investments topped the list of the most active stocks table during the month with 543.3 Mn traded shares followed by Multiply Group and Dana Gas Company, which traded 455.5 Mn shares and 307.1 Mn shares, respectively. In terms of value traded, IHC topped the table with AED 4.6 Bn worth of shares changing hands during the month followed by Alpha Dhabi Holding and First Abu Dhabi Bank at AED 1.8 Bn and AED 1.2 Bn, respectively.

Dubai Financial Market

The DFM General Index recorded 1.5% fall during March-2024, its first decline after four straight months of gains, closing the month at 4,246.3 points. The monthly sector performance chart was evenly balanced with four out of eight sectors recording declines while the remaining four saw gains during the period. However, the decline in the Financial Sector (-5.2%), the largest weighted sector in the exchange, dragged the general index to the red. The decline in the index was mainly due to the double-digit share price declines of several of its constituent companies such as Mashreq Bank (-14.6%). The Consumer Staples Sector recorded the second largest decline among the sector indices (-1.4%) followed by the Communications Services Index (-1.2%). On the other hand, the Real Estate Index registered a 4.0% gain during March-2024, the biggest gain among the indices to close the month at 8,034.1 points. The indices’ remarkable monthly growth was mainly driven by the double-digit growth of two of its key constituent companies, i.e., Deyaar Development (+11.5%) and Union Properties (+20.3%).

According to monthly stock performance from Bloomberg, Union Properties topped the monthly gainers table with 20.3% jump in share price followed by Ithmaar Holding and GFH followed with gains of 19.2% and 13.7%, respectively. Union Properties recorded exceptional financial results for the 2023 fiscal year which reached AED 811 Mn recording 60% annual growth in operating profits reflecting real estate demand. On the decliner’s side, Al Salam Bank Sudan topped the table with a decline of 15.1% followed by shares of Mashreq Bank and Dubai Islamic Bank which recorded declines of 14.6% and 9.5%, respectively, during March-2024.

Trading activity on the exchange witnessed strong growth during March-2024. Total volume traded increased by 36.9% to reach 4.8 Bn shares as compared to 3.5 Bn shares during February-2024. Similarly, the total value of shares traded during the month increased at a relatively lower pace of 11.1% to reach AED 8.8 Bn in March-2024 as compared to AED 7.9 Bn during February-2024. Union Properties topped the monthly volumes traded chart recording 1.1 Bn shares which changed hands during the month followed by Gulf Finance House and Deyaar Development which saw 617.9 Mn and 313.7 Mn of their shares change hands during the month, respectively. On the monthly value traded chart, Emaar Properties topped the list with AED 1.7 Bn worth of shares changing hands during the month, followed by Dubai Islamic Bank, and Emaar Development which saw AED 850.7 Mn and AED 776.7 Mn value of their shares traded, respectively.