Regional markets push higher on signs that recession may be easing

Abu Dhabi's benchmark index climbed to a four-month high on Thursday on signs the global recession is easing.

Abu Dhabi's benchmark index climbed to a four-month high yesterday, while measures in five other gulf markets advanced on signs the global recession is easing. Strong results from banks in Oman and Qatar also helped push regional markets higher. "We are seeing markets close higher with increased volumes because we have got global and regional catalysts in terms of international market performance as well as positive quarterly earnings coming through from locally listed companies," said Ali Khan, the managing director of Arqaam Capital. "Volumes continue to remain healthy as local and international liquidity re-enter the market."

The Abu Dhabi Securities Exchange General Index rose 1.26 per cent to 2,679.77 and the Dubai Financial Market index gained 1.43 per cent to 1,712.37, following gains on Wall Street on Wednesday. "Snippets of data indicating that western economies may be seeing the first glimpse of a recovery are keeping the rally going in our markets and encouraging investors not to sell prior to first-quarter earnings releases," said Matthew Wakeman, a markets commentator at EFG Hermes.

On the Abu Dhabi market, Aldar Properties, the emirate's top property developer by market value, gained for a third trading session as consulting firm Jones Lang LaSalle said the emirate may be the region's best-performing property market in the next year to two years. Aldar rose 2.83 per cent to Dh4 and Sorouh Real Estate advanced 2.47 per cent to Dh2.90, its highest close in three months. "Real estate stocks continue to perform well as banks become more accessible to borrowers again," said Mr Wakeman. "Cityscape Abu Dhabi, which starts on Sunday, is also providing support for Aldar and Sorouh, given the different demand picture in Dubai."

Property and construction firms in Dubai also witnessed gains, with Emaar rising 6.45 per cent to Dh2.64 and Union Properties gaining 1.09 per cent to Dh0.92. "Even now, despite the recent run-up we have had in the property market, the movement of certain stocks is significant as those valuations are not viewed as particularly expensive," said Mr Khan. Financial services stocks also climbed, with Shuaa Capital rising 4.62 per cent to Dh1.13 on the Dubai market following confirmation that the firm's operations would continue after shareholders demonstrated support at an extraordinary general meeting on Wednesday.

Gains were seen across the Gulf, with the Qatari exchange advancing 2.78 per cent to 5,379.49 "There are some good results coming out of Qatar, especially among the banks," Julian Bruce, the director of institutional equity sales at EFG Hermes, told Bloomberg. Foreign institutional investment in Qatari stocks is increasing, "especially in the large caps and that is now starting to spill over into the UAE as well".

"Doha Bank numbers were very, very good and financials in Qatar and Saudi Arabia continue to come in with encouraging numbers," said Mr Khan. Doha Bank added 8.2 per cent to 34.5 riyals, the most since Nov 2. The bank's first-quarter profit rose to 329.7 million Qatari rials (Dh332.6m) as it focused lending to small and medium-sized companies. Kuwaiti stocks rose 0.84 per cent to 7,417.8 and Muscat's exchange gained 2.95 per cent to 5,209.74. Bahrain's All Share Index rose 0.7 per cent to 1,674.45.

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