ShareKUWAIT: Geopolitical events in the GCC during Sept-19 tested investors' confidence in regional markets after the sharp decline following the attacks on Saudi Arabian oil facilities. The performance of GCC indices remained mixed, characterized by steep volatility especially during the second half of the month. The attacks pushed the Saudi benchmark's YTD-19 performance towards the red for the first time this year at a yearly intraday low of 7,589.5 points. However, TASI saw a quick reversal to record the second highest monthly gain of 0.9 percent. On the other hand, Kuwait recorded a decline of 4.4 percent after investors booked profits following elevated valuations.
This decline along with Abu Dhabi's -2.1 percent and Bahrain's -1.1 percent decline more than offset gains in other markets resulting in a 1 percent decline in the MSCI GCC Index in Sept-19. In terms of sector performance, Banks, Basic Materials and Real Estate stocks continued to slide during the month while consumer sectors, including Food Beverage & Tobacco, Retailing, Pharma and Consumer Services, and Telecoms saw a low single-digit gains during the month. Shares of a majority of the banks declined that was partially offset by 12.1 percent gain in shares of ENBD that reached a 12-year high level after the bank increased the foreign ownership limit in its stock to 20 percent and announced its intention to raise to 40 percent. The performance of telecom stocks remained mixed but the overall sector was buoyed by 8.3 percent gain in shares of STC.
Global markets remained largely positive after a volatile Aug-19. Performance for almost all the major markets were positive with low single digit gains as markets overlooked recent political events including in the US and UK as well as US China Trade war. The broader MSCI World Index gained almost 2.0 percent during the month taking cues from positive performance of both Emerging Market indices as well as developed market benchmarks.
Boursa Kuwait
Boursa Kuwait remained in the red for the second consecutive month during September-19 and recorded the biggest monthly decline in the GCC as investors booked profits. All the three Kuwaiti indices witnessed declines during the month primarily led by large-cap stocks. This was reflected in the 5.4 percent decline in the Premier Market Index with all the index constituents seeing declines for the second consecutive month. Shares of KFH in the Premier Market witnessed the biggest decline of 9.8 percent. The Islamic lender is in talks to acquire Bahrain's AUB and finalized a share swap deal with the later's investors valued at $8.8 billion. Burgan Bank followed and was the second biggest decliner in the 19-stock index falling 8.9 percent during the month. The Main Market index, meanwhile, recorded a relatively smaller decline of 1.6 percent resulting in a decline of 4.4 percent for the All Share Index. Declines during the month pushed Kuwait to the second position in the GCC after Bahrain in terms of YTD-19 returns that stood at 11.8 percent for the All Share Index as the 17.2 percent gains for the Premier Market index was offset by 0.5 percent decline in the Main Market Index. In terms of sector performance, only the Insurance sector recorded gains during the month at 3.2 percent after 9.3 percent and 4.3 percent gain in shares of Gulf Insurance Group and Warba Insurance more than offset decline in shares of Kuwait Insurance and Wethaq Takaful.
Nevertheless, the Banking index continues to lead in the Kuwait in terms of YTD-19 returns that stood at 19.5 percent followed by Financial Services and Telecom indices at 13.6 percent and 13.1 percent, respectively. Trading activity surged during the month as compared to August-19. Monthly value traded increased by 53 percent to reach KD 750 million in September-19 as compared to KD 490 million during the previous month. Monthly volume also increased but at a slightly slower pace of 20.3 percent to reach 3.1 billion shares. KFH once again topped the monthly value traded chart with KD 179.5 million worth of trades followed by NBK and AUB-Bahrain at KD 101.9 million and KD 95.0 million, respectively. On the monthly volume chart, AUB-Bahrain topped with 347 million shares followed by KFH and A-Ayan Leasing at 265.9 million shares and 177 million shares, respectively.
The monthly gainers chart was topped by Tahssilat with a gain of 51 percent followed by KMEFIC and Al-Masaken International Real Estate with gains of 41.9 percent and 41.8 percent, respectively. On the decliners side, Warba Capital topped with a fall of 36.2 percent followed by Amwal International Investment and Al-Argan International Real Estate with declines of 34.5 percent and 23.8 percent, respectively.
Saudi Arabia (Tadawul)
After two consecutive months of decline, Saudi Arabia's TASI witnessed marginal gains during September-19. The benchmark gained after reaching yearly intraday low of 7,589.5 points following the attacks on its oil facilities and closed the month with a gain of 0.9 percent. The index also regained the psychologically important 8,000 mark during the last week of the month and closed at 8,091.76 points.
Gains during the month pushed YTD-19 returns for the benchmark to 3.4 percent. In terms of sector performance, a majority of the sectoral indices recorded gains during the month that were partially offset by marginal decline in large-cap sectors including Banks and Materials.
Abu Dhabi Securities Exchange
ADX continued its declining streak from Aug-19 into Sept-19, as the main index was down 2.1 percent m-o-m. The index closed at 5057.31 points, as sectoral performance was mixed, but skewed more towards sectors that declined. Real Estate was the worst performing index, as the sector declined by 6.1 percent m-o-m in Sept-19, driven by Aldar Properties, which was down 6.7 percent m-o-m. Separately, Aldar launched its first residential community in Saadiyat Island - Saadiyat Reserve. The AED 722 million community features 306 infrastructure enabled land plots open to buyers of all nationalities, ranging between 600 sq.m to 1,400 sq.m, suited to accommodate homes of 4-6 bedrooms. Project execution is due to begin in Q1-20 with handovers scheduled for mid-2022. Banks followed with declines of 2.8 percent m-o-m, as banking sector stocks dominated the decliners on the ADX, led by National Bank of Umm Al Qawain (-13.6 percent) and Commercial Bank International (-10 percent).
Dubai Financial Market
The DFM index however managed to close marginally in the green in Sept-19, after witnessing a significant decline in Aug-19 (-5.5 percent). The frontline index was up 0.8 percent m-o-m and closed at 2,781.10 points. Sectoral trends and market breadth nevertheless were more skewed towards decliners. Banks and Telecoms were the main drivers behind the DFM closing in the green for the month of Sept-19, as the sectors gained by 6.1 percent and 2.9 percent respectively. The gains in the Banking sector was almost single-handedly driven by Emirates NBD, as the stock gained by 12.1 percent m-o-m foreign ownership limit in the bank's shares was raised to 20 percent from 5 percent previously. Telecoms were up from large cap Etisalat gaining by 2.9 percent m-o-m and offsetting the 3.3 percent m-o-m drop in Hits Telecom. Industrials index was the worst performing sectoral index, down 7.7 percent m-o-m, as National Cement Co plunged by 7.7 percent for the month. Real Estate & Construction companies followed with declines of 5.1 percent m-o-m, driven by declines in Emaar Properties (-6.9 percent), Damac Properties (-8.7 percent) and Union Properties (-8.6 percent).
Qatar Exchange
After falling in Aug-19 (-2.6 percent), Qatar Exchange gained and was the best performing market in Sept-19 (+ 1.3 percent), as the QE 20 index closed at 10,367.08 points. The Qatar All Share index which maps the broader market, also exhibited similar improving trends, as the index gained by 1.6 percent m-o-m for the month. Market breadth was broadly even, as 18 stocks gained, while 19 stocks closed the month in the red. Sectoral performance barring the Banks & Financial Services index was positive. The Insurance index was the best performing index with gains of 6.4 percent m-o-m, driven by a 7.0 percent m-o-m gain in the share price of Qatar Insurance, and a 10.5 percent jump in Al-Khaleej Takaful. The Consumer Goods & Services index also moved up by 5.4 percent, with Qatar German Co. for Medical Devices (+12.4 percent) and Qatar Fuel (+8.9 percent) ending Sept-19 as the main contributor to sector gains.
Bahrain Bourse
The Bahrain All Share remains one of the best performers in the region YTD at the end of Sept-19 (+13.4 percent), despite the index declining by 1.1 percent during Sept-19. Sectoral performance was mixed for the month and had both gainers and decliners. Commercial Banks were the worst performing index was the index was down 2.0 percent m-o-m in Sept-19, driven down singlehandedly a 4.1 percent of AUB. Other sectors that declined m-o-m included Hotels & Tourism (-1 percent) and Investment Companies (-0.4 percent). Insurance was the best performing index, albeit with marginal gains of 1.0 percent, while a 0.9 percent gain in ALBA pushed up the Industrials sector (+0.9 percent) in Sept-19. Market breadth favored decliners as 14 stocks decline, while 10 stocks witnessed higher prices.
Muscat Securities Market
Oman's stock market continued to surge for the second consecutive month during September-19 although the gains were marginal as compared to the previous month. The MSM 30 index gained 0.3 percent during the month and closed above the 4,000 mark at 4,017.7 points. Nevertheless, despite gains recorded over the last two months, Oman continues to remain the worst performing market in the GCC in terms of YTD-19 and the only market with negative returns that stood at -7.1 percent. Gains during September-19 came primarily on the back of the Services sector with the corresponding index gaining 4.1 percent during the month followed by Financial index with a marginal gain of 0.4 percent.
KMACO GCC Markets Monthly Report
