Kuwait Times, Sunday, Dec 05, 2021 | Rabi Al-Aakhir 30, 1443
GCC index declines 4.7% as new COVID variant spooks investors
Kuwait:
GCC markets declined for the first time in 13 months in November-2021 as the new
COVID-19 variant, Omicron, sent shockwaves across financial markets globally.
The MSCI GCC index dropped 4.7 percent during the month, in line with most major
exchanges globally. In terms of market-cap, total value of listed stocks in the
region declined by $205 billion to reach $3.5 trillion by the end of the month.
The monthly decline during November-2021 dented the performance of GCC markets
since the start of the year which now stands at 29.7 percent.
Within the GCC, Abu Dhabi and Dubai exchanges remained largely resilient to the
global pressure, although even these markets were not spared on
28-November-2021, which saw steep global single day sell-off, with declines of
1.8 percent and 5.2 percent. Most GCC markets reported a decline during
November-2021, barring ADX and DFM that reported a gain of 8.7 percent and 7.3
percent, respectively. Saudi Arabia’s TASI reported the biggest decline of 8.1
percent losing almost $240.3 billion in market-cap during the month.
The decline highlighted the impact of the slide in oil prices to below $70/b
mark, although briefly. The month also saw Abu Dhabi further strengthening its
global lead in terms of market performance since the start of the year with a
return of 69.4 percent, one of the highest globally. Dubai also scaled up to be
the third best performing market in the GCC with a YTD-21 return of 23.3
percent. On the other hand, Saudi Arabia remained the second ranked market in
the GCC, but with a smaller lead over Dubai with a gain of 23.8 percent.
The GCC sector performance chart showed declines across the board during
November 2021 with the exception of Diversified Financials and Telecom indices
that reported gains of 5.3 percent and 4.2 percent, respectively, while Real
Estate was almost flat with a gain of 0.1 percent. Consumer Durable & Apparel
was the biggest decliner with a monthly fall of 21.5 percent followed by
Utilities and Pharma & Biotech indices with declines of 13.5 percent and 12.4
percent, respectively.
Boursa Kuwait
Kuwaiti benchmarks receded during November-2021 with the second-biggest drop
during the month following a broad-based decline that affected most markets in
the region as well as globally. In terms of market segments, the Main 50 Index
witnessed the biggest monthly decline of 4.9 percent as performance of
constituent stocks in the index were skewed downwards. The Premier Market Index
and the All-Share Market Index reported a monthly decline of 4.5 percent
followed by the Main Market index that receded 4.3 percent during November-2021.
With the declines, Kuwait lost one spot in terms of YTD-2021 returns and now
ranks at the fourth position with a return of 22.4 percent for the All Share
Index. The Main 50 Index was up 26.5 percent vs. 21.4 percent gains for the
Premier Market Index.
The sector performance chart also highlighted the broader decline in the market
with merely two indices, Insurance and Health Care, showing gains of 7.6 percent
and 1.8 percent, respectively, during the month. The Basic Materials Index was
the biggest decliner with a double-digit decline of 10.4 percent followed by the
Industrials and Financial Services indices with declines of 7.0 percent and 6.2
percent, respectively. Large-cap indices like Banking and Telecom witnessed
mid-single digit declines. The Banking sector index was down by 3.8 percent
during the month after shares of 9 out of ten Kuwaiti banks declined. The
Telecom index declined by 4.3 percent reflecting decline in 4 out of 5
constituent stocks in the index. Shares of all the three telecom providers
dropped during the month with Zain leading with a decline of 5.0 percent.
In terms of monthly stock performance, Credit Rating & Collection Co topped the
chart with a gain of 96.4 percent followed by Umm Al-Qaiwain General Investments
Co and Jiyad Holding Co with gains of 28.6 percent and 28.4 percent,
respectively. On the decliners side, MENA Real Estate Co topped with a fall of
47.0 percent followed by National Co for Consumer Industries and Salbookh
Trading Co with the declines of 38.4 percent and 27.5 percent, respectively.
Trading activity remained upbeat during the month with the total volume of
shares traded during the month was the highest since January-2017 and increased
by 14.8 percent m-o-m to 10.7 billion shares as compared to 9.3 billion shares
traded during Oct-2021.
Monthly value traded witnessed an increase of 36.8 percent to reach KD 1.7
billion in November-2021 as compared to KD 1.25 billion in Oct-2021. GFH
Financial Group topped the monthly value traded chart with KD 163.5 million
worth of shares traded followed by KFH and NBK at KD 142.1 million and KD 122.7
million, respectively. On the monthly volume chart, GFH Financial Group.
Saudi Arabia
(Tadawul)
After witnessing gains for ten consecutive months, the Saudi Stock Exchange
reported a steep decline during November -2021 led by a global sell-off
triggered by a new variant of COVID-19. The index closed the month below the
11,000 mark for the first time since July-2021 at 10,761.8 points, witnessing a
monthly decline of 8.1 percent. The new COVID-19 variant further affected oil
market sentiments that was already low owing to the release of SPR by the US
government during the last week of the month.
Brent futures traded near the $70/b mark after declining by more than 17 percent
from its peak of over $86/b seen during the last week of October-2021. The
decline in TASI also affected the benchmark’s YTD-21 performance which now
stands at 23.8 percent, marginally above the third ranked exchange in the
region.
Abu Dhabi Securities
Exchange
Abu Dhabi Exchange reported the best monthly performance during November-2021
despite declines towards the close of the month. The index surged for the
fourteenth consecutive month and registered a gain of 8.7 percent to close at
8,546.52 points. With consecutive positive performance since the start of the
year, the ADX index showed one of the highest returns globally at 69.4 percent.
The monthly sector performance chart remained mixed but was skewed towards
gainers with six out of the nine sectors recording gains during the month. The
Telecom index led the way registering 24.1 percent gain during the month mainly
led by gain in shares of Emirates Telecom Corp that was up 24.8 percent during
the month followed by Sudan Telecommunication Company which saw a 10.6 percent
increase in its share prices.
Dubai Financial
Market
The DFM index rose significantly into positive territory during November-2021
and was second-best performing market during the month after ADX. The benchmark
witnessed a gain of 7.3 percent during the month and closed at 3,072.9 points
after a marginal 0.7 percent monthly decline in October-2021. Gains came mainly
on the back of the news that Dubai government plans to list as much as ten
state-owned firms in Dubai Stock Exchange.
In terms of YTD-21 performance, the index showed returns of 23.3 percent at the
end of November-2021, the third highest in the GCC after ADX and TASI. In terms
of sector performance, five out of nine sectoral indices dipped into the red
during the month, however, the Financial and Investment Services index jumped
37.3 percent.
Qatar Exchange
After reaching multi-year high levels during October-2021, the QE 20 Index
reported the third-biggest m-o-m decline during November-2021. The index closed
the month at 11,386.31 points registering a decline of 3.2 percent. The Qatar
All Share Index also reported a decline of 3.2 percent, indicating a broad-based
weakness in the market. With the decline during Nov-2021, the YTD-2021 returns
for the QE 20 index was slashed to 9.1 percent, one of the lowest performance in
the GCC. Comparatively, the QE All Share index reported a relatively higher
YTD-21 growth of 12.8 percent.
Bahrain Bourse
Bahrain All Share index dipped into the red, albeit marginally, during
November-2021 led by a broad-based decline. The index fell 0.8 percent during
the month to close at 1,729.6 points after gains at the start of the month was
completely wiped off by the end of the month. The index was in the green until
the last trading day, but a decline of 1.4 percent on 30-November-2021 pushed
MTD gains in the red. In terms of YTD-21 performance, the index is up 16.1
percent for the first eleven months of the year, ranking fifth in the GCC.
Muscat Securities
Market
The Omani stock market recorded 1.8 percent decline during November-2021 after
witnessing 3.4 percent gain during October-2021. The MSX index closed slightly
above the 4,000 mark at 4,000.35 points after consistent declines at the start
of the month was only partially offset by gains during the second half. In terms
of YTD-21 performance, the MSX index was up 9.3 percent this year making it the
second-lowest gaining market in the GCC this year.
In terms of sector performance, all the three main sectors of the exchange fell
into negative territory during November-2021.The Services Sector index fell 3.6
percent during the month whereas the Industrial and Financial indices reported
declines of 2.4 percent and 0.5 percent, respectively.