Most of the GCC markets ended positive in August with Dubai and Abu Dhabi equity indices rising the most, gaining 3.2% and 2.2% respectively, according to Kuwait Financial Centre (Markaz). 

 

Regionally, the Gulf markets outperformed global markets with S&P GCC composite index rising by 0.7% for the month. This was despite oil prices declining by 12.3% for the month with downwards pressure on demand, increasing fears of recession and uncertainty over a potential nuclear deal with Iran, stated Markaz in its recently released Monthly Market Review report for August..

 

Qatar’s equity index also posted a gain of 0.4% over the same period, backed by rising oil prices and increased demand for natural gas, while Saudi Arabia’s index was up by 0.7% driven by positive Q2 earnings released by major blue-chip companies, 

 

Among premier market stocks, Kuwait Projects Company Holding (Kipco) and HumanSoft Holding Company gained the most for the month, rising by 5.9% and 4.9% respectively. 

 

National Investments Company and Kuwait Real Estate Company fell the most for the month at 11.4% and 8.1% respectively, it added. 

 

Kipco obtained CMA approval for capital increase, which is to be utilized towards executing the merger of Kipco and Qurain Petrochemical Industries Company (QPIC).

 

According to Markaz, the Central Bank of Kuwait raised its discount rate by 25 bps to 2.75% in the month of August due to rising inflationary pressures. 

 

Oil prices declined by 12.3% for the month with downwards pressure on demand, increasing fears of recession and uncertainty over a potential nuclear deal with Iran.

 

Among sectors, the oil and gas and insurance sectors gained the most for the month at 4.6% and 4.3% respectively while technology and healthcare sectors lost 14.8% and 6.4% respectively in the month. 

 

Inflation was majorly driven by the Food & Beverage segment, which grew at 7.7% y-o-y in July 2022. Fitch opined Kuwait’s GDP to grow by 7.1% in 2022 and by 4.6% in 2023 backed by rise in oil prices and production. 

 

As per IMF forecasts, Saudi Arabia’s economic growth is expected at 7.6% for 2022 and predicts to be one of the fastest growing large economies on the back of surge in oil prices. 

 

KSA’s oil revenue in Q2 2022 increased by 89% year-on-year to $66.8 billion. As per IMF, Qatar has attracted FDI worth $19.2 billion in Q2 accounting for 71% of the total investments in Middle East. 

 

According to EY, the number of IPOs in Mena region experienced a 500% y-o-y increase in H1 2022 with proceeds of 24 IPOs amounting to $13.5 billion – an increase of 2,952% y-o-y in value compared to H1 2021.

 

US Fed Reserve Chair Jerome Powell restated that the US Central Bank will continue to raise its interest rates to fight the rising inflation. Consumer Price Inflation for Kuwait rose by 4.2% y-o-y in July compared to 2021.-TradeArabia News Service