Global Gains Steady Gulf Bourses
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Global Gains Steady Gulf Bourses

Global Gains Steady Gulf Bourses

As world markets rally to Spain’s bond sale the Gulf region sees shares and oil improve.

Gulf Business

Gulf Arab bourses are likely to be steady on Thursday as gains on world markets soothe fragile regional sentiment.

Asian shares are at one-week highs and oil is also up on hopes Europe is dealing more urgently with Spain’s banking crisis, but risk aversion is still high and analysts warn a convincing turnaround on battered global bourses will remain elusive for the time being.

That means Gulf investors will be reluctant to commit more money to stocks on the final day’s trading before the weekend.

“The global economic situation means the correlation between Gulf and international markets will remain high,” says Shakeel Sarwar, head of asset management at Securities & Investment Co (SICO) in Bahrain.

“Summer is arriving so the best case scenario is for markets to consolidate around current levels and then, after the global outlook improves, we could get a regional rally.”

Sarwar predicts Gulf markets will trade sideways for at least a couple of months.

“The end of Q3 and start of Q4 could be the right time for a more sustained rally – there could be short-term rallies in the meantime, but these probably won’t last more than a few days,” he adds.

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