Regional Investors to Follow Trends in Global Markets, Oil Prices

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CORONAVIRUS IMPACT

Global equities closed in negative territory with US stocks closing at a 6-week low, which was mainly driven by weakness in technology stocks and worries that the Fed’s monetary policy is becoming less effective in supporting a broader recovery. Although investors clearly reduced their exposure in technology giants during the week, buying activity picked in value stocks and small caps. Oil prices recorded a gain of 8.34% during the week, supported by an unexpected drawdown in US oil inventories and Saudi Arabia’s efforts to push OPEC and its allies to comply with output quotas. 

For the MENA region, sentiments continued to remain broadly positive during the week as 4 out of the 7 regional indexes closed in green, supported by strong gains in oil prices and improving business activity. Bahrain was the best regional performer with gains of 3.28%, followed by 2.49% in Saudi Arabia, and 2.22% in Dubai. On the other hand, Oman was the worst regional performer with losses of 1.05%, followed by 0.19% in Abu Dhabi, and 0.18% in Egypt. 

Going forward, the rising concern surrounding US Fed’s monetary policy becoming less effective as the pace of recovery is slowing down will continue to play out within the global equity markets. Moreover, investors will also take this an opportunity to reshuffle portfolios to buy into stocks and sectors that have broadly underperformed due to the sharp rise in technology stocks. For the MENA region, investors will continue to follow the trend in global markets and the developments in oil prices to accordingly position themselves in the markets.

Indexes   Last WTD (%) MTD (%) YTD (%)
Dubai (DFMGI) 2,320.87 2.22% 3.37% -16.06%
Abu Dhabi (ADSMI) 4,510.60 -0.19% -0.19% -11.13%
Saudi (SASEIDX) 8,337.88 2.49% 5.00% -0.61%
Kuwait (KWSE) 4,332.43 0.39% 3.53% -11.78%
Egypt (EGX30) 11,050.89 -0.18% -2.77% -20.85%
Bahrain (BHSEIDX) 1,435.25 3.28% 3.94% -10.86%
Oman (MSM30) 3,647.71 -1.05% -3.29% -8.38%
Commodities    Value WTD (%) MTD (%) YTD (%)
Gold (s/OZ) 1949.69 0.42% -1.02% 28.52%
Silver ($/Oz) 26.77 0.11% -5.14% 50.14%
WTI ($/bbl) 40.97 9.84% -3.85% -32.90%
Natural Gas 2.04 -12.07% -22.43% -6.81%
OPEC Oil ($/bl) 43.15 8.34% -4.70% -34.62%
Copper ($/MT) 6841.21 2.56% 2.54% 10.34%
Aluminium ($/MT) 1793.92 0.93% 0.56% -1.57%
FX Rates   Value WTD (%) MTD (%) YTD (%)
USD/AED 3.673 0.00% 0.01% 0.01%
USD/SAR 3.751 0.00% 0.01% 0.00%
USD/EGP 15.76 0.00% -0.38% -1.50%
USD/EUR 0.845 0.07% 0.84% -5.27%
USD/JPY 104.57 -1.51% -1.25% -3.72%

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