Financial Market Analysis for GCC Markets

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GCC stock markets could see divergent moves this week, with markets likely to react differently to the strength of the oil market and the unfolding global economic slowdown. Some price corrections were seen last week and may continue in some markets while others may return to the upside. In any case, strong local fundamentals and improved sanitation conditions should provide some support.

Investors will remain vigilant about China’s Evergrande’s ability to hedge its liabilities going forward, as the company already missed a payment deadline last week. The Chinese government is expected to step up surveillance, as fears of a negative impact on the rest of the economy remain a concern.

Federal Reserve decision

While the Federal Reserve’s decision last week to keep interest rates unchanged and limit asset purchases helped market sentiment, the bank also lowered its forecast for economic growth. The same conclusion has been expounded by other Western central banks, suggesting further economic downturns in the coming months that could impact markets elsewhere, including the GCC.

Oil price

Oil prices may continue to rise this week as the market remains tight and may tighten even further. The production increases promised by OPEC + have not yet peaked, as some member countries struggle to increase production while US production has not recovered to pre-hurricane levels. At the same time, demand is expected to increase as utilities continue to turn to oil as a source of energy as the winter season approaches.

Dubai Stock Exchange

The Dubai stock market could see further price corrections this week as it emerges from an 18-month uptrend. The market will remain weighed down by concerns about the global economic slowdown and to some extent by the uncertainty surrounding production levels in the oil market. However, the price corrections should not be too large as strong local fundamentals and positive health developments act as a cushion for the market.

Digital AAN

AAN Digital has seen its prices rise since the start of the pandemic, with telecommunications taking center stage in both business and personal environments. The company is expected to see its revenues increase, as full and partial remote working becomes the norm in many companies. The stock price could return to positive territory this week after last week’s correction.

Dubai Investment Shares

Dubai Investment stock could see its price increase in the coming weeks after its latest corrections. The company would achieve better numbers as the health situation improves and as more countries reduce restrictions, helping Dubai to play its role as a hub and boost activity as a whole. The stock could also spark additional interest from international investors seeking greater exposure in the region, as the company’s stock futures are now available for trading.

Saudi Stock Exchange

The Saudi stock market could come back to show a positive trend as market prices in the Federal Reserve’s decision last week and the sharp rise in oil prices. The market could see continued support from crude prices as demand continues to improve as production levels lag. This boost should come on top of strong local fundamentals that kept the market from correcting too much throughout September.

Tihama Advertising Company

Tihama Advertising Company could see its stock price rise as high oil prices and government initiatives to diversify the economy away from oil are expected to boost local consumption and spur increased communications budgets. As a result, the company is expected to see its numbers improve and its losses decrease over the next few quarters.

Egyptian scholarship

The Egyptian stock market could post further gains this week as investor risk appetite remains strong following the direction taken by Western central banks. The trend could also intensify if the major stock markets slow down further, as international investors will begin to seek opportunities in riskier markets.

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Any opinions, news, research, analysis, pricing or other information contained herein are provided as general market commentary and do not constitute investment advice. Exness accepts no responsibility for any loss or damage, including without limitation any loss of profit, which may result directly or indirectly from the use of or reliance on such information.

© Press release 2021


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