Arab bourses "cautious" as investors monitor half-year results

Jun 22, 2007, 12:35 GMT

Amman - Arab stock markets reflected mixed performance this week, but analysts said Friday they expected bourses to remain 'cautious' in the coming weeks as investors monitor half-year corporate results.

'I believe markets will be cautious and move sideways in the coming couple of weeks until the release of the balance sheets of listed firms for the first six months of the year, particularly blue chip companies,' an Amman-based portfolio manager told Deutsche Presse-Agentur dpa.

Regional stock markets would however continue to benefit from the presence of huge amounts of cash-seeking investment outlets, particularly surplus petrodollars, which continue to build up in the oil-rich Gulf states due to soaring crude prices, he said.

Saudi shares continued to suffer this week for the third week in a row, with the Tadawul All Share Index (TASI) tumbling on Saturday and approaching its lowest point this year.

However, the market was able to recover some of its losses by the end of the week, driven by Telecom and banking stocks.

TASI closed weak at 7,022.05 points, which represents a 0.7 per cent decline from last week's close at 7,074.51 points.

The Saudi benchmark price is currently 11.5 per cent lower that the year's start, according to the weekly report of the Bakheet Financial Advisors (BFA).

'Volatility was associated with sharp correction in speculative small caps ahead of the publication of first half results,' the report said.

Meanwhile, the Capital Market Authority (CMA) is continuing its efforts to enhance the market's depth by offering new investment opportunities.

It will be listing on Tuesday the 'Arabian Shield Cooperative Insurance' as the sixth stock in the insurance sector, the BFA said.

They expected investors to be watching the performance of blue chip firms 'which will represent the market's driving force'.

Jordanian shares gained some new ground this week amid a move by funds to amend their positions ahead of the second half of the year, according to the AB Invest, the Arab Bank's investment arm.

The all-share prince index of the Amman Stock Exchange closed week marginally higher at 5,825 points compared with last week's close at 5,804 points, according to the ASE weekly report.

Kuwaiti shares continued their strong performance this week among growing interest in leading firms, the Global Investment House said in its weekly report.

The KSE all-share price index gained 2.3 per cent this week, closing at 11,943 points up from 11,676 points last week.

The unified all-share price index of the United Arab Emirates stock exchanges of Dubai and Abu Dhabi closed steady at 4,616 points compared with 4,602 points last week.

The UAE benchmark price gained 14.5 per cent since the beginning of the year, analysts said.

Palestinian stocks responded positively to the declaration by the United States and the European Union that they would be resuming financial aid to the Palestinian Authority after the formation of an emergency cabinet led by the US-educated economist Salam Fayyad.

The Palestinian Jerusalem all-share price index climbed 12.63 per cent this week, closing at 516.16 points.