GCC markets powered by optimism about Q3 earnings

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CORONAVIRUS IMPACT

GCC stock markets are expected to be supported in the near term by optimism over upcoming third-quarter earnings, although they are vulnerable to profit-taking as they near multi-year peaks hit in August.

Dubai’s index DFMI climbed 2.2 percent to 2,666 points on Thursday, its highest close since Aug. 26 and 3.0 percent away from this year’s peak. Benchmarks in Abu Dhabi Qatar and Kuwait also rose to three-week highs.

Market analysts expect heavier profit-taking closer to the peaks, especially since major global markets pulled back on Friday after surging earlier in the week in response to the U.S. central bank’s decision to maintain its stimulus.

In general, there is a positive investor sentiment towards the regional markets. Still many stocks are undervalued and investors are expected to continue buying now in anticipation of better results for the third quarter and year- end.

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