The GCC equity markets closed in the green last week, defying global gloom, according to investor relations consulting firm Iridium Advisors.
Dubai (+4.5 percent) notably hit an 8-year high on 4 July, spurred by Emaar Properties and Emirates NBD. Kuwait (+2.2 percent) rebounded from the previous week’s loss. Qatar (+1.7 percent) enjoyed a lift-off, fueled by heavyweights QNB and Industries Qatar. Saudi Arabia (+1.2 percent) resumed its climb after a voluntary extension of a 1 million barrels per day (BPD) oil production cut to August. Oman (+0.5 percent) registered a five-week consecutive uptrend. Meanwhile, Abu Dhabi (+0.6 percent) inched up as PMI data indicated new orders for June increased at their fastest pace in four years. However, the US saw market downturns with the Nasdaq Composite (-0.9 percent), S&P 500 (-1.2 percent), and Dow Jones (-2.0 percent) reversing their past week’s gains as a hawkish tone in the Fed’s meeting minutes and some upbeat economic data raised interest rate hike concerns. European markets, too, ended deep in the red, with the CAC40 (-3.9 percent), FTSE100 (-3.6 percent), DAX (-3.4 percent), and STOXX600 (-3.1 percent) all reversing their past week’s gains.
Read more: GCC markets eye global rally, set sights on H1 2023 earnings season kick-off
Regional markets – Watch this earnings cycle
The GCC markets may tread cautiously amidst the global equities sell-off last week, coupled with US rate worries. Still, the sturdy crude oil prices may offer some cautious optimism. Investors will likely hold their cards close to their chest as the 2Q23 earnings season looms. This week sees QNB, Zain Bahrain, and several Omani companies slated to release their 2Q 2023 results. Additionally, CBI’s shareholders will mull over a proposed capital increase through rights issuance.
Global markets – Inflation and beige book on watch
US markets will closely watch inflation data, with CPI numbers expected to rise by 0.3% from May’s 0.1%. The release of the Beige book will be on the radar along with several Fed speeches. In the EU, the spotlight will be on industrial production data, while the UK’s labor market report and comments from BoE governor Andrew Bailey will keep market participants on their toes.
GCC net foreign flows in June 2023
The GCC region recorded strong net foreign inflows of over $1.24 billion in June, following an outflow of $423.8 million in May. For the first time since November 2022, all GCC markets posted net inflows in June 2023. Dubai (+$332.0 million) and Abu Dhabi (+$300.2 million) shouldered nearly half of the total net inflows into the GCC. Saudi Arabia continued to attract foreign investors as they stood as net buyers for a 9th straight month, investing over $4.8 billion on a net basis cumulatively since October 2022. After consistently remaining net sellers since December 2022, foreigners invested $59.7 million in Kuwait in June. Qatar was favored by overseas investors for a 3rd month in June (+$37.0 million) while Oman also recorded foreign inflows ($5.0 million) for a ninth straight month.
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