DUBAI:Firm oil prices and global equities prices look set to support stock markets in the Gulf on Sunday, especially in Saudi Arabia, where investors bought back petrochemical shares late last week as they bet that oil may finally have bottomed.
Brent oil closed at $52.65 on Friday, slighlty above its level when Gulf markets last traded on Thursday, while the MSCI all-country world equity index climbed 0.7 percent for its eighth daily gain. It was up 4.4 percent for the week, its biggest weekly advance since December.
In Saudi Arabia the stock index, which last closed at 7,685 points, may soon test technical resistance at 7,812-7,953 points, its highs in September and at the end of August.
Samba Financial Group, Saudi Arabia’s third-largest bank by assets, may attract interest after reporting a 7 percent rise in third-quarter net profit to 1.37 billion riyals ($365.38 million); analysts polled by Reuters had on average forecast 1.25 billion riyals.
Oil shipper Bahri also beat estimates; its net profit for the three months to Sept. 30 was 510.3 million riyals, up from 84.85 million riyals in the same period a year earlier. Albilad Capital had forecast 300 million riyals.
Overall, the initial days of the Saudi third-quarter earnings period have been mixed, however. Saudi British Bank reported a profit that was roughly in line with forecasts while Saudi Hollandi Bank narrowly missed forecasts.
Almarai, the Gulf’s largest dairy company, reported a 10.3 percent rise in third-quarter net profit to 595.1 million riyals; analysts had forecast 602.9 million riyals.
Egypt’s market may stay firm after trading volume surged to its highest level this year on Thursday in response to news that Orascom Telecom and Act Financial aimed to buy Beltone for 650 million Egyptian pounds ($83 million).
However, the threat of currency depreciation looks likely to continue overhanging the market; the pound fell relatively sharply against the dollar in the parallel market on Thursday after official data showed foreign reserves fell back sharply in September.