On Sunday, a gauge of Gulf bourses had fallen across the board as a darkening outlook of crude oil futures’ prices alongside a pandemic-led demand crunch of crude oil across the globe had taken a heavier toll on investors’ sentiments, while another session of tattering of Commercial International Bank had weighed on Egyptian blue-chip index.
In point of fact, almost all of the major stock exchanges in the Mid-east had ebbed off on Sunday, while the latest sell-off wave in the Gulf stock exchange followed a nearly 2 per cent plunge of crude oil futures’ prices on Friday’s commodity market closure, as investors were fretted over Libyan oil authorities remarks that the oil-rich nation would be stepping up its output up to 1 million barrels per day or 1 per cent of the world’s entire crude oil output within four months.
Aside from that, an OPEC+ decision to raise output by early-2021 had also added to further strains.
Gulf burses fall amid bleaker-than-anticipated oil demand outlook
In tandem, Saudi’s main index nosedived 4.1 per cent on Sunday’s market closure, marking up the index’s largest intra-session plunge in more than five months, while shares’ prices of Saudi Basic Industries Corp.
shrugged off 4.5 per cent despite a rise in net profit over the third quarter of the year and the Saudi’s state-backed oil mogul Aramco shed 2.3 per cent. Meanwhile, referring to a chronic weakness in Saudi’s main index which in effect had been weighing on smaller Gulf bourses, a fund manager at Mena Capital, Khaled Abdel Majeed said on Sunday’s Mid-east market closure, “It is about time that the Saudi market weakened.
The market trades at unsustainably high multiples (low 20s forward multiple) and earnings growth of less than 10%, does not warrant that high valuation. ” Apart from that, a recent leg of armed combat between a Saudi-led coalition and the Yemeni Houthis had also spelled a downward trend in the Gulf markets, suggested analysts.
Citing statistics, Dubai main index fell 0.4 per cent following a plunge of 0.8 per cent in Emaar Properties, while Abu Dhabi’s main index had managed to eke out a gain of 0.3 per cent, mostly boosted up by a 3.2 per cent climb in Abu Dhabi Commercial Bank.
Elsewhere in the Gulf, Qatari bourse retreated as much as 1.5 per cent after Mesaieed Petrochemical had wrapped up the day down by 7.1 per cent. Outside the Gulf, Egypt’s blue-chip index had rounded off the day 3.5 per cent lower following a 6.9 per cent decline in the shares’ prices of Commercial International Bank.