Saudi Arabia’s bourse may continue rising on Tuesday after strong second-quarter results from local banks, while the release of an opposition politician in Kuwait could reduce political tensions that have weakened the market in the last few days.
The main index in Saudi Arabia rose 0.4 per cent on Monday and closed at 9,790 points, very close to its intra-day high of 9,795 points. A minor double bottom formed by the June lows points back up to the June peak of 9,906 points.
Banks were the main support for the index after Riyad Bank became the first local lender to report its second-quarter results. Its profit rose 17.4 per cent, beating the estimates of analysts who had forecast a 13.9 per cent increse.
After trading closed, Banque Saudi Fransi also reported its quarterly profit, which at SAR884 million was five per cent above analysts’ average estimate.
Kuwait’s market, which has weakened in the last three sessions following public protests on Thursday and Sunday that were dispersed by police, could stabilise after a court released prominent opposition politician Musallam al-Barrak on bail on Monday.
Barrak’s detention for questioning, after he had allegedly insulted Kuwait’s judiciary, was the main reason for the protests.
Dubai’s market is vulnerable to further profit-taking in the absence of fresh, positive catalysts as the rally fuelled by builder Arabtec’s rebound appears to have lost steam.
Shares in Arabtec rose four per cent on Monday, after soaring 55 per cent in the previous four days. Trading volume in the stock on Monday was highest since early 2010; this was apparently because of a scramble to cover short positions, and if the covering has largely been completed, upward momentum in Arabtec may fade.