Stock markets in the Gulf states made a strong showing in the third quarter on the back of higher oil prices and positive sentiment, recovering some of their massive losses last year. Five of the seven Gulf stock markets have risen, some sharply, in the latest three months following unprecedented losses last year and in the first quarter of 2009 due to the global economic meltdown. The Saudi Tadawul All-Shares Index (TASI), the largest Arab bourse, closed the quarter at 6,322.04 points, up 31.6 percent on last year's finish of 4,802.99 points. The index lost 56.5 percent last year. The recovery was led by Dubai's benchmark, which shed almost three quarters of its value last year, and Saudi's main index, which dipped by more than half in 2008. Since the start of the year, the region's seven markets have added a remarkable 125 billion dollars to their capitalization, which reached $725 billion on Sept. 30, up from $600 billion at the end of last year. The recovery is even stronger in comparison to the low point in this year's first quarter, when capitalization dropped to $550 billion, down by half from $1.116 trillion at the end of 2007. Kuwait's Global Investment House attributed the recent rise in Gulf stocks to the “surge in crude oil prices and positive indicators from world markets.” The index of Kuwait stock market, the second-largest in the Arab world, was up just 4.4 percent from the end of last year, reaching 7,817.30 points on September 30, versus 7,782.60 points on December 31. KSE and Bahrain were the only Gulf markets to drop in the third quarter. However, the bourses of Dubai and Abu Dhabi in the United Arab Emirates made strong gains, especially in the third quarter, with the gradual return of confidence. Dubai's index finished at 2,191.03 points on September 30, up a healthy 33.9 percent on last year's close of 1,636.29 points. Market heavyweight Emaar Properties has gained about 79 percent after shedding 85 percent last year. The Abu Dhabi benchmark, which shed 47.5 percent in 2008, closed at 3,124.22 points, a rise of 30.7 percent on last year's finish of 2,390.01 points. Last year, the two markets reeled under a severe correction in the leading real estate market which had experienced spectacular growth in the past few years. In Qatar, the Doha benchmark was up 7.7 percent at 7,414.25 points at the end of the third quarter compared to last year's close of 6,886.12 points. The Muscat index gained 20.8 percent since the start of the year to close the third quarter at 6,572.25 points while Bahrain's benchmark fell 13.8 percent to finish at 1,554.51 points. At the close of the last trading day in September, Gulf markets were mixed, with banking stocks again in the spotlight following a directive from UAE exchanges on the lenders' Saudi exposure and a Morgan Stanley report on Saudi banks. The Tadawul index advanced 0.68 percent, finishing at 6,322.04 points on Wednesday. Contrary to other GCC exchanges, Saudi banks and insurers posted gains, with Islamic insurance operator Weqaya Takaful Insurance and Reinsurance Co. posting the second largest gain (9.82 percent higher at SR35.80). Samba Financial Group, Morgan Stanley's top pick in the Saudi banking sector, gained nearly 5 percent, making it one of the strongest gainers of the day. Of the seven regional exchanges, Saudi Arabia, Dubai and Bahrain edged higher, while the four other bourses posted losses. Analysts expect more sideways trading in the following days, as investors will look out for more cues from international markets. Abu Dhabi's main index eased 0.1 percent to 3,124 points. Muscat's main measure retreated 0.4 percent to 6,572 points while Kuwait's index declined 0.2 percent to 7,817 points. However, Dubai and Manama's benchmark climbed 1.3 percent to 2,191 points and 0.1 percent to 1,554 points, respectively.
