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GCC Equity Markets Record Strong Performance in January

Prime Highlights: 

GCC equity markets showed robust growth in January, with Kuwait’s All Share Index leading at a 5.7% gain, followed by Saudi Arabia’s 3.1% increase. 

The S&P GCC Composite Index rose by 3%, outperforming global indices such as the S&P 500 (2.7%) and MSCI EM (1.7%). 

Growth in key sectors like oil and gas (11.7%) and real estate (11.1%) boosted Kuwait’s equity market. 

Key Background: 

Equity markets in the Gulf Cooperation Council (GCC) region demonstrated solid growth in January, with Kuwait and Saudi Arabia emerging as top performers. According to a recent report by Kuwait Financial Center (Markaz), the S&P GCC Composite Index increased by 3% during the month, driven primarily by strong gains in Kuwait and Saudi Arabia’s equity markets. 

Kuwait’s All Share Index rose by 5.7%, marking the largest gain among GCC markets, while Saudi Arabia’s equity market grew by 3.1%. Abu Dhabi’s equity index saw a rise of 1.8%, Dubai’s index increased by 0.4%, and the Qatar Stock Exchange posted a modest 0.9% gain. However, Bahrain’s market lagged, with its index declining by 5.4% due to a sharp 18.5% drop in Aluminum Bahrain’s stock following the termination of a proposed deal with Saudi Arabian Mining Company. 

The S&P GCC Composite Index’s performance in January outpaced that of major global indices, including the S&P 500, which gained 2.7%, and the MSCI Emerging Markets (EM) Index, which grew by 1.7%. Notably, Kuwait’s equities outperformed both GCC and global markets, supported by strong earnings expectations from the banking sector and increased deal activity in the energy and real estate sectors. 

Saudi Telecom Company was the top performer in Saudi Arabia’s stock market, with its share price rising by 8.7%. Additionally, the approval of STC Bank, the Kingdom’s first licensed digital bank, further bolstered investor sentiment. The report also highlighted the rise in oil and gold prices, with Brent crude oil increasing by 2.8% to $76.8 per barrel, and gold prices surging by 6.8% to $2,759.3 per ounce. Looking ahead, the report suggests that the global economic outlook, including the impact of U.S. trade policies, will significantly influence GCC markets in the months to come.