UAE shares rise on oil
8/31/2009 3:27:55 PM -
United Arab Emirates and Qatari shares have advanced to their highest levels in almost three weeks as oil holds above $70 a barrel and evidence builds that the global recession is ending.
Qatar's DSM 20 Index climbed 2.4 percent to 7,088.17, the highest level since Aug. 11. The Dubai Financial Market General Index added 1.9 percent and Abu Dhabi's measure gained 0.9 percent.
'The backdrop to international markets remains encouraging and the recent U.S. and European corporate results remain good as well,' Ali Khan, head of cash-equity trading at Dubai-based Arqaam Capital Ltd., wrote in an e-mail.
'This is positive for commodities and commodity-based economies', he added.
Crude closed last week at $72.74 a barrel, above the budget breakeven points for the six Gulf Cooperation Council countries, which together supply 20 percent of the world's oil.
According to Citigroups Inc, the U.A.E. and Saudi Arabia, the world's top crude exporter, must sell oil for an average of about $70 a barrel in 2009 to finance imports and domestic projects.
Consumer spending in the U.S. rose in July as households took advantage of the government's 'cash for clunkers' program to buy new cars, the Commerce Department said Aug. 28.
Employers in the U.S. probably cut jobs in August at a slower pace and manufacturing grew for the first time in more than a year, economists said before reports scheduled for release this week.
Shuaa Capital PSC closed at its highest level since June 29, gaining 14.6 percent to 1.73 dirhams.
The U.A.E.'s biggest investment bank received regulatory approval to issue new shares, representing 48 percent of the company to Dubai Banking Group in exchange for convertible bonds.
Shuaa said after the markets closed, it appointed Sameer Al Ansari as Chief Executive Officer, replacing Iyad Duwaji.
Qatar Shipping Co., a marine freight transportation company, soared the most in almost six months, adding 7.9 percent to 31.3 riyals. The shares jumped 10 percent in intraday trading, the maximum a stock is allowed to gain or lose on the Doha bourse.
Barwa Real Estate Co., Qatar's second-largest property developer, gained the most since Aug. 4, adding 3.6 percent to 34.6 riyals.
Saudi Arabia's Tadawul All Share Index fell 0.7 percent, the Kuwait Stock Exchange Index lost 0.1 percent and Bahrain's measure declined 0.2 percent. Oman's MSM30 Index gained 0.9 percent.
The Islamic holy month of Ramadan, which began Aug. 21, is traditionally a time of low-volume trading in the Gulf region.
Qatar's index traded at 19 percent of its three-month volume average today, while Saudi Arabia's measured at 37 percent of the average, according to Bloomberg data.