Arab stock markets shrugged off spreading fighting in Libya and turmoil in other regional nations and rebounded by nearly $35 billion in March after a big loss in the previous month, official figures showed on Tuesday.
The bulk of the increase was in Saudi Arabia’s bourse, which jumped by nearly $33 billion to offset massive losses in the previous weeks, showed the figures by the Abu Dhabi-based Arab Monetary Fund (AMF).
Turnover, the value of traded shares, also soared to its highest monthly average this year to nearly $40 billion through March compared with around $23.9 billion in February and 34.3 billion in January.
Most of the rise was in Saudi Tadawul bourse, where turnover surged to around $29 billion in March from $17 billion in February, the figures showed.
From around $910 billion during February, the combined market capitalization in the Arab world’s 15 official bourses climbed to nearly $925 billion in March, said the AMF, a key Arab League establishment.
The surge partly offset losses in the previous month, when the collective capitalization dipped by around $45 billion because of investors’ concerns about turbulence in some regional nations and a possible spillover into others.
Most of the growth in March was in the Saudi Tadawul bourse, the largest and busiest stock exchange in the Middle East, with its capitalization increasing to $351 billion at the end of March from $318 billion at the end of February. The Increase more than offset the decline of around $22 billion through February.
Tadawul’s recovery followed statements by the Kingdom’s finance minister that the domestic economy is in a good shape. The statements were supported by two major financial initiatives announced by King Abdullah of Saudi Arabia over the past month, involving spending of more than $130 billion in unemployment allowances, housing and other benefits for Saudis.
“There is no doubt the King’s initiatives gave a strong push to the Saudi market…another factor is that investors’ fears about the spread of turmoil in the region to their country appear to have eased,” said Jamal Ajjaj, an analyst at the Sharjah-based Sharhan Securities.
A breakdown showed Dubai and other key markets recorded increase through March while other bourses stabilized or slightly declined.
Dubai grew by around $three billion to $53.5 billion to make up for loss it suffered during February while Abu Dhabi edged up by nearly $300 million to $68.7 billion.
Gas –rich Qatar, which is recording one of the highest GDP growth rates in the world, saw a recovery by about $seven billion to reach nearly $117 billion following a decline of around $10 billion.
Kuwait, the second largest Arab stock market, maintained its downward trend following limited protests and tension in ties with Iran, dipping to around $110 billion at the end of March from $117 billion a month earlier.
Bahrain slipped by only around $200 million to $20 billion despite violent demonstrations in late March while Oman’s bourse gained around $300 million to end March at nearly $20.2 billion, according to the AMF.
Outside the oil-rich Gulf, Egypt gained just around $100 million just a few days after it was reopened while Morocco’s exchange shrank by nearly $three billion to end the month at about $66.4 billion.
Syria’s Damascus bourse, which has just been added to the AMF stock data base, extended its February decline and slumped by $200 million to $2.7 billion as the country continued to reel under turmoil.
Jordan’s bourse dipped by around $800 million to $28.7 billion while Lebanon’s Beirut market edged up slightly to nearly $17.6 billion.
The Tunisian bourse continued to recover following the ouster of its present to reach $10.2 billion at the end of March compared with $9.4 billion at the end of February. Palestine’s bourse gained over $100 million to reach $3.9 billion, according to the report, which gave no figures for Sudan and Algeria.
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