Markaz: Global and Gulf stock markets continue to recover in June

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In its monthly report on the performance of the markets for the month of June 2020, the Kuwaiti Financial Center “Markaz” said that the Gulf markets continued their recovery, registering gains for the third month in a row in June. Low-value Dubai shares topped the list of gainers among Gulf countries, while oil prices crossed the $ 40 mark.

The “Markaz” report indicated that the performance of Kuwaiti markets was positive during the month, as the general index of Kuwaiti shares achieved 2.7% gains in June. The easing of curfews, along with the recovery in oil prices, contributed to a positive view of investor appetite. Morgan Stanley Capital International has announced that it will reclassify Kuwait indices from border markets to emerging markets in November 2020, with the semiannual review of the index. At the same time, the Kuwaiti Cabinet agreed to reduce the budgets of government entities and institutions for the fiscal year 2020/2021 by no less than 20% to reduce the deficit resulting from the spread of the Covid-19 pandemic. . Agility has also entered into an agreement with the Public Authority for Housing Welfare in Kuwait to develop a special project to develop a warehouse and craft area in Sabah Al-Ahmad Residential City. The basic and industrial materials sector was the best performer in Kuwait during the month, thanks to its high indicators, which increased by 9.2% and 7.8%, respectively.

On the regional level, the Markaz report indicated that the Standard & Poor’s Composite Index for the Gulf Cooperation Council countries rose by 1.6% in June, and all Gulf markets, except Oman, announced profits. The Dubai market was the best performer among the Gulf markets, recording a rise of 6.2% for the month, followed by the markets of Abu Dhabi, Kuwait, Qatar and Saudi Arabia, who recorded a rise of 3.5%, 2.7%, 1.7% and 0.2%, respectively. In its latest report, the World Bank stated that the economies of the Gulf states will contract by 4.1% in 2020, but will restore growth by 2.2% in 2021. In a related context, Saudi Arabia has resorted to the mining sector as it contributes to achieving its economic recovery. The Saudi Cabinet also approved a new mining law aimed at accelerating the pace of foreign investment while ensuring the existence of continuous funding for the sector as well as supporting activities of geological survey and exploration programs. The law is in line with the kingdom’s efforts to diversify away from oil by expanding foreign investment in the mining sector.

The Center’s report indicated that Etisalat and the International Holding Company were the best performing leading companies from outside Kuwait for this month, as they achieved a 5.0% and 4.9% increase, respectively.

Global stock markets performed positive for the third month in a row, with the MSCI World Index increasing 2.5% in June. US stocks (S&P 500) rose 1.8% despite increasing cases of Covid-19 virus in several states due to the second wave of the virus. The Fed also decided to keep interest rates unchanged during the June meeting, and indicated that it will keep interest rates at levels close to zero until the economy recovers. The US Federal Reserve expects the US GDP to decline 6.5% in 2020 before increasing 5% in 2021. In addition, Apex confirmed its commitment to continue purchasing bonds targeting $ 80 billion per month in Treasury bonds and $ 40 billion USD in mortgage-backed securities. The UK market index (FTSE 100) remained positive, gaining 1.5% for the month. The Bank of England also announced during its announcement in June that it would raise the bond purchase program to $ 123 billion while keeping the key rate at a record low of 0.1%. Emerging markets saw a rebound in their performance during the month, as the MSCI Emerging Markets Index increased by 7.0%.

As for oil prices, they closed at the level of $ 41 a barrel by the end of June 2020, recording a rise of 16.5%, with OPEC members and its allies agreeing to extend production, while expectations of energy demand increased due to the easing of restrictions imposed by most countries to limit the spread of the virus. As for gold prices, it continued to rise steadily by 3.1% in June in light of the growing concerns about the second wave, which increased the demand for safe-haven assets.

General market trends – June 2020

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Last close

June%

2020 %

Standard & Poor’s Gulf Markets

96

1.6

-18.4

Saudi Arabia (Tassi)

7,213

0.2

-15.2

Qatar (Qatar Stock Exchange Index)

8,845

1.7

-15.9

Abu Dhabi (Abu Dhabi index)

4,142

3.5

-16.7

Kuwait (General Market Index)

4,996

2.7

-20.8

Dubai (Dubai General Market Index)

1,945

6.2

-26.7

Bahrain (Bahrain General Index)

1,270

0.6

-18.6

Oman (Muscat Securities Market Index)

3,545

-0.8

-11.1

Goods

Brent crude (US $)

41

16.5

-37.7

Gold (USD)

1,781

3.1

17.4

Source: Reventv

– is over –

About the Kuwait Financial Center “Markaz”

The Kuwait Financial Center (KSC) “The Center” was established in 1974 to become one of the leading financial institutions at the regional level in the fields of asset management and financial and financial services. The Center now manages assets totaling 1.14 billion Kuwaiti dinars, as in
December 31, 2019 ($ 3.77 billion). The Center was listed on the Kuwait Stock Exchange in the year 1997.

For more information, please contact:

Sundus Saad

Media and Communication Department

Kuwait Financial Center Company KSC “Center”

Phone: +965 2224 8000

Email: [email protected]

markaz.com

© Press Release 2020





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