Financial Market

All GCC equity markets plunged in May tracking global cues

GCC equity markets saw huge declines in May on panic selling as investors took their cue from global markets. There was some profit booking too as valuations were elevated across the region. All markets reported declines during the month with Dubai dropping the most–10 percent–followed by Bahrain and Kuwait with declines of over 6 percent, according to a report by Kamco Invest.

The MSCI GCC index rounded off the month with a decline of 7.5 percent.

Nevertheless, the GCC aggregate index remained in the green zone in terms of year-to-date (YTD) performance, up 12 percent, with gains for all the seven benchmarks.

In terms of sector performance, the declines were led by heavyweight sectors. Only the GCC F&B index showed noticeable gains during the month at 2.7 percent and the Energy index was up by less than one percent.

UAE

Abu Dhabi’s FTSE ADX index was the best performing market in the GCC during May despite slipping a shade to 10,054.9 points.

The exchange’s market capitalisation rose 0.7 percent to reach 1.9 trillion dirhams.

The Consumer Staples index recorded an increase of 13.5 percent–the largest monthly gain among the indices–driven mainly by Agthia and National Corp for Tourism and Hotels which saw gains of 15.7 percent and 7.6 percent, respectively.

Trading activity fell during the month. Total volume of shares traded fell to 4.9 billion shares compared to 7.9 billion shares in the previous month. Total value fell 29 percent to reach 30 billion dirhams.

Dubai Financial Market (DFM) General Index saw the biggest declines in May, ending the positive run seen over the previous seven months. The benchmark closed at 3,347.24 points, down 10 percent.

Six out of nine sectoral indices fell, including large-cap sectors such as Banks, Real Estate and Insurance sectors. The Banking Sector index fell over 10 percent after nine out of the 12 constituent banks saw their share prices soften.

Trading activity on the exchange fell compared to April. Total volume of shares traded fell 45 percent to reach 2.7 billion shares in May. Total value also fell over 29 percent to reach 8.4 billion dirhams.

Saudi Arabia

The Saudi Tadawul TASI saw its first decline in six months during May under selling pressure from global equity markets. After peaking and falling during the month, the index closed at 12,921.7 points, registering a decline of 5.9 percent. Saudi Arabia now ranks second in the GCC in terms of YTD-2022 performance with a gain of 14.5 percent.

The gainers’ side was led by the Diversified Financials index with a gain of 6.9 percent mainly led by 15.3 percent rise in shares of Saudi Tadawul and 8.3 percent rise in shares of Kingdom Holding that more than offset decline in the remaining four constituents.

Monthly volume of shares traded rose nearly 10 percent to reach 4.1 billion shares. However, the value of shares traded fell by nearly 10 percent to reach 166.9 billion riyals in May.

Kuwait

The Kuwaiti equity market showed net declines for May. The Premier Market index fell 6.8 percent while the Main 50 Index and the Main Market indices registered smaller declines of 4.5 percent and 5 percent, respectively. The net impact was a decline of 6.4 percent for the All-Share Market Index.

Among sectors, only the Basic Materials index showing a gain of 4 percent during the month. Large-cap indices like Banking sector index was down by 6.7 percent during the month after shares of eight out of ten Kuwaiti banks declined.

Total traded volume rose over 15 percent to 5.2 billion shares. Monthly value also rose 20 percent to hit 1.61 billion Kuwaiti dinars.

Qatar

The Qatar Stock Exchange declined for the first time in six months during May, with its benchmark index falling 4.9 percent during the month.

The QE20 index closed the month at 12,919.4 points.  Sector performance was mixed. Banks & Financial Services Index fell 7.6 percent followed by Industrials and Consumer Goods and Services indices with declines of 2.5 percent and 2.3 percent, respectively.

Trading activity fell 22 percent compared to April to 3.4 billion shares. Total value traded also slipped to 15.8 billion riyals.

Bahrain

The Bahrain Bourse declined for the second consecutive month in May. The Bahrain All Share Index fell 6.6 percent to 1,920.78 points.

The Materials sector reported the biggest decline during the month with a fall of 10.9 percent followed by Communication Services and Financials index with declines of 7.4 percent and 6.0 percent, respectively.

Total volume of shares traded fell marginally to reach 73.3 million shares in May. Total value plunged 40 percent to 24.3 million dinars.

Oman

Oman’s MSM 30 Index fell 1 percent to 4,116 points. Financial and Industrial indices fell 0.65 percent and 1.36 percent to reach 6,557.9 and 6,257.8 points, respectively. The Services index showed the biggest decline of 3.4 percent.

Trading activity declined compared with the previous month. Total volume of shares traded during the month fell 52 percent to 252.5 million shares. Monthly value traded dropped 18 percent to 74.3 million Omani rials.

(Writing by Brinda Darasha; editing by Seban Scaria) 

brinda.darasha@lseg.com

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