Arab investors earn $140bn

Arab share investors emerged wealthier by nearly $140 billion (Dh513bn) in the first four months of 2008 as dealers in many global markets continued to count their losses from the fallout of the US sub-prime crisis.

With the exception of the largely speculative Saudi bourse which recorded a decline, the stock markets in the Arab world steamed ahead on strong corporate performance, high liquidity, an economic upswing in many regional states, and a steady flow of foreign capital seeking save haven.

During the first four months of 2008, the combined market capitalisation of the 14 official Arab bourses gained a staggering $140bn and more than half the increase was in Kuwait, according to official figures.

From nearly $1.33 trillion at the end of 2007, their capitalisation shot up to around $1.47trn at the end of April, showed the figures by the Abu Dhabi-based Arab Monetary Fund (AMF), which tracks the daily movement in the Arab stock exchanges.

Experts said the increase was a result of good performance of most companies

listed in the markets, growing investors confidence in local bourses, return of part of overseas national funds for high share yield, swelling liquidity and flow of foreign investment into the region, mainly the Gulf after many local companies boosted the level of expatriate ownership of their shares and others planned to admit in some foreign investors.

"Another reason is that many firms in the Gulf raised their capital to reinforce their financial position and at the same time match a rapid growth in their business," an Abu Dhabi-based stocks dealer said. Kuwait emerged as the star performer in the Arab bourse, gaining nearly $75bn, more than half the total increase in the Arab capitalisation.

Other key gainers were Morocco and Egypt, which added nearly $15bn each, and Lebanon, which gained around $7bn.

The UAE gained around $3bn but taken individually, Abu Dhabi was the profiting bourse as Dubai declined by around $1bn.

All other bourses recorded gains except Saudi Arabia's Tadwaul exchange. Its market capitalisation dipped by around $22bn during the first four months.

According to AMF, the Arab League's main financial organisation, the number of listed companies in the 14 Arab bourses increased to 1,526 at the end of April from 1,498 at the end of 2007.

But experts said the rise had no major impact on the capitalisation on the grounds the bulk of the increase involved small firms in Lebanon, where they rose from 15 to 48.

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