Brent Crude approaches $90 and mixed results for GCC markets

Saudi Aramco eyes potential $50 bn secondary share offering
Brent Crude approaches $90 and mixed results for GCC markets
Global markets

The GCC markets ended mixed, according to Iridium advisors. Saudi (+1.1 percent) climbed the most, tracking a healthy increase in crude oil prices. Oman (+0.5 percent) recovered its past week’s loss. Abu Dhabi (+0.2 percent) edged higher, partly driven by IHC. Bahrain (0.0 percent) closed flat for a second consecutive week. Dubai (-0.2 percent) partially reversed its past week’s gain, while Kuwait (-0.7 percent) remained in a downtrend for a third successive week. Qatar (-1.6 percent) showed weakness in industrial and banking stocks and these weighed on the overall performance.

In the U.S., while the Dow Jones (+1.4 percent) recouped its prior week’s loss, the S&P 500 (+2.5 percent) and Nasdaq Composite (+3.2 percent) advanced further. In the U.S., currently, bad news appears to be good news for equities. Last week the markets rallied on soft economic data on consumer confidence, and private jobs, and revised 2Q23 U.S. GDP growth which missed consensus estimates, and helped in easing interest rate concerns.

Read: GCC markets show resilience amidst global turbulence

Meanwhile, European markets maintained their upward momentum, with the FTSE100 (+1.7 percent) outpacing its peers for another week, followed by the STOXX600 (+1.5 percent), DAX (+1.3 percent), and CAC40 (+0.9 percent).

The Week Ahead for GCC markets

Regional markets – Strength in global equities could support GCC stocks.

Driven by an oil price surge, with Brent crude nearing the $90 per barrel threshold, GCC markets could kick off the week with optimism. This trend is a windfall for Gulf states and oil companies like Saudi Aramco, said to be eyeing a secondary share offering of around $50 billion later this year according to the Wall Street Journal. The upbeat sentiment is further bolstered by a global equities rally and waning concerns over US interest rate hikes.

On this week’s corporate agenda, 2Q 2023 earnings calls are on the docket for Galfar, Jazeera Steel, and OIFC. Additionally, shareholders of Scientific & Medical Equipment will mull over a bonus share issuance, while The National Investor’s board examines a potential acquisition.

Global markets – BoE monetary policy hearing to be in focus

In the US, it is expected to be a relatively quiet week as investors will focus on economic data points such as services PMI and jobless claims later during the week. In the EU, the important economic releases are GDP and PMI numbers.

Investors will also look forward to speeches from ECB policymakers including Christine Lagarde. Meanwhile, the UK’s attention will pivot to the Monetary Policy Report Hearing, which could shed some light on interest rates.

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