MARKET REPORT Yemen helps Tadaul rise for eighth day

Saudi Arabia’s stock market rose for an eighth straight day in active trade yesterday, climbing above technical resistance, as sentiment was helped by hopes for an end to the conflict in Yemen.

Former Yemeni president Ali Abdullah Saleh said yesterday he was ready for a “new page” in ties with the Saudi-led coalition fighting in Yemen if it stopped attacks on his country, in a move that could pave the way to end nearly three years of war.

The Saudi stock index gained 1.2 per cent to 7,089 points. It rose above resistance around 7,000 points, which has capped the market since mid-October and roughly coincides with the 200-day average, now at 7,014 points.

A clean break of the resistance – two straight daily closes – would point up to around 7,250 points, according to the height of the former downtrend channel dating back to mid-October.

“Recently the main force affecting the market has been geopolitics – it’s not surprising that the market rises when the outlook appears to improve,” said Hisham Tuffaha, vice president for asset management at Mulkia Investment in Riyadh.

Rising stocks outnumbered losers by 173 to nine. Four of the 10 biggest percentage gainers were cement stocks, long beaten down by the slump in the Saudi construction industry; they could benefit if Yemen starts to rebuild, fuelling demand for cement.

The Saudi market has also been buoyed in recent days by easing worries about the impact of authorities’ crackdown on corruption, as some detained suspects reach settlements with the government and the number of frozen bank accounts falls after exceeding 2,000 at one stage.

A monthly Reuters poll of leading Middle East fund managers, published last week, showed them on balance positive towards Saudi Arabia; 46 per cent now expect to raise allocations to Saudi stocks in the next three months and none to cut them, the most bullish bias since July.

Egypt’s index gained 0.9 per cent as real estate firm Talaat Mopstafa surged 2.8 per cent to 10.25 Egyptian pounds. The company said it expected sales of 13 billion pounds ($735 million) this year and record sales in 2018.

The UAE and Omani markets were closed for public holidays.