Dubai stocks soared the most in more than a year, leading an advance in Gulf Arab markets, after oil prices rebounded and global equities rallied.
The DFM General Index climbed 6.1 percent as of 12:10 p.m. in Dubai as traders exchanged 307 million shares, 21 percent above the 12-month full daily average volume. Saudi Arabia’s Tadawul All Share Index jumped 5.6 percent, the most in five months. Qatar’s QE Index and Abu Dhabi’s ADX General Index rose 5.2 percent and 3.9 percent, respectively.
Stocks rallied across the six-nation Gulf Cooperation Council after oil advanced the most since August on Friday. While governments have attempted to diversify their economies away from crude, the commodity remains the region’s biggest source of revenue. The equity advance also follows the biggest surge in world stocks since June 2012 on speculation central banks will expand stimulus measures to counter turmoil in financial markets.
“The global rally and oil price recovery is a great signal for investors here to buy,” said Hisham Khairy, the Dubai-based head of institutional trade at Mena Corp. Financial Services LLC, one of the United Arab Emirates’ largest brokerages. “If tomorrow the market opens higher, it would offer a great selling opportunity.”
Oil Rises
Brent crude, a pricing benchmark for half of the world’s oil, soared 10 percent to $32.18 a barrel on Friday. U.A.E. Energy Minister Suhail Al Mazrouei sees the price of oil stabilizing either at the end of this year or the beginning of 2017. The GCC is home to about 30 percent of the world’s proven reserves.
The gauge that tracks some of the region’s top companies climbed the most since August. Saudi Basic Industries Corp., one of the world’s biggest chemicals manufacturers by sales, was the biggest contributor to the Bloomberg GCC 200 Index’s increase as the stock rose 8.5 percent. Al Rajhi Bank in Saudi Arabia followed with a 7.4 percent gain.
The kingdom may sell shares in Saudi Arabian Oil Co., also known as Aramco, in an initial public offering after the drop in crude prices strained the nation’s finances. The sale won’t include crude oil reserves, which belong to the state, Chairman Khalid al-Falih told Al Arabiya TV in an interview.
Kuwait’s stocks and Oman’s MSM 30 Index advanced 1.1 and 1.5 percent, respectively. Bahrain’s Bourse All Share Index dropped 0.2 percent, the region’s only decliner.