Arab markets gain over $13bn in one month

Arab stock markets continued to shrug off current turmoil in the region and gained over $13 billion in one month, most of which was in Saudi Arabia’s bourse, the largest in the Middle East, official data showed on Tuesday.

From around $941 billion on March 17, the combined market capitalization of the region’s 14 stock exchanges swelled to nearly $954.5 billion on April 17, showed the figures by the Abu Dhabi-based Arab Monetary Fund (AMF).

Analysts said the increase was a result of what they described as recovering investors’ confidence in the Gulf after risk of a spillover of the current turbulence into Saudi Arabia and other Gulf nations largely receded.

Another supporting factor is the improvement in domestic economies due to a surge in oil prices because of the events in Libya and elsewhere in the region.

A breakdown showed Saudi Arabia’s Tadawul bourse was the driving force in the market momentum in the Arab world, with its capitalization surging by around $14 billion to $965.5 billion on April 17.

Qatar’s Doha bourse also gained nearly $five billion to reach $122.7 billion while Dubai grew to about $54.9 billion from $52.9 billion.

Abu Dhabi exchange swelled by nearly $one billion to $70.6 billion while Kuwait dipped by about $four billion to $112.9 billion on April 17.

The smaller Gulf bourses of Bahrain and Oman seesawed slightly, with Manama bourse slipping to $19.6 billion from $20 billion and Oman’s Muscat Securities Market edging up to $20.7 billion from $20.6 billion.

Outside the Gulf, Egypt’s bourse slipped by about $one billion following its reopening early this month after a closure of several weeks because of the revolt that toppled former President Hosni Mubarak.

Morocco’s Casablanca’s exchange slumped to $65.2 billion from $69.6 billion and Tunisia’s bourse to $9.9 billion from $10.2 billion.

The gain in the collective Arab market capitalization followed a massive loss in the early days of the unrest in the region, with Tadawul alone tumbling by nearly $54 billion. It sharply rebounded following the return of relative stability in neighbouring Bahrain, statements by its finance minister about better prospects for the domestic economy and a gigantic financial benefits initiative announced by King Abdullah for citizens over the past weeks, involving spending of nearly SR500 billion for new houses, unemployment allowances and other benefits.

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