Saudi Arabia and Dubai Financial Market Lead Record Biggest Monthly Gains in 9 Months

The GCC markets closed April-2023 at the highest level since the last week of January-2023 mainly led by consistent gains during the last week of the month.

Saudi Arabia was the best performing market during the month with a gain of 6.8% followed by the UAE markets with monthly gains of 4.1% and 3.8% for Dubai and Abu Dhabi, respectively. The gains during the month pushed Saudi Arabia’s TASI benchmark above the 11,000-mark to the highest level since November-2022 led by consistent gains since mid-March-2023.

The sector performance chart for the month showed gains across the board with the Diversified Financials index topping the monthly list with a gain of 12.8% followed by Telecom and F&B sector indices with gains of 10.2% and 9.4%, respectively. Large-cap sectors like Energy was next with a gain of 9.3% while the Banking gauge saw a relatively smaller gain of 3.8%.

Saudi Arabia

Saudi Arabia’s TASI recorded the best monthly return in the GCC during April 2023. The Index breached the psychological mark of 11,000 points and closed at 11,307.77 points, which is the highest closing since November-2022, resulting in a monthly gain of 6.8%.

The performance of the index was buoyed by a combination of factors, including elevated oil prices and strong corporate profitability for Q1-2023 for companies listed on the Saudi Exchange. The monthly performance pushed the YTD- 2023 gains for TASI further into the positive zone to 7.9%.

The monthly sector performance chart favoured gainers and was topped by the Diversified Financials index with a gain of 14% followed by the Energy and Telecommunication Services indices with a gain of 11.7% and 10.4%, respectively.

Gains for the Diversified Financials index was mainly led by double-digit gains of 24.4% in shares of Al-Baha Investment and Development Co. further supported by gains of 16.2% and 14% in shares of Saudi Tadawul Group Holding Co. and Saudi Advanced Industries Co., respectively.

Shares of Aseer Trading, Tourism and Manufacturing Co. and Kingdom Holding Co. also showed strong gains of 12.8% and 6.5%, respectively. The resilience of the Telecommunication Services sector continued during the month after all the constituent stocks in the index witnessed gains.

Shares of Zain KSA and Saudi Telecom Co. reported gains of 15.7% and 10.9%, respectively. Gains for the Energy sector was led by 12.4% gain in shares of Saudi Arabian Oil Co. and 10.7% gain in shares of Rabigh Refining and Petrochemical Co. partially offset by 2.6% decline in shares of Arabian Drilling Co. Within the Banking sector, all the constituent stock posted gains barring Saudi Investment Bank with a decline of 0.6% supported by solid earnings.

Dubai Financial Market

The DFM General Index recorded the second-best monthly increase of 4.1% during April-2023 bouncing back from a marginal decline of 0.9% during March-2023 to close April-2023 at 3,544.79 points.

The monthly index performance was induced by increases in six out of the eight sectoral indices including Financials, Real Estate, and Consumer Staples sectors. The Consumer Staples Index recorded the biggest monthly gain of 13.2% to close the month at 120.2 points. The Financials Index followed with 6.7% gain during the month driven by double-digit growth in shares of certain financial companies such as Amlak Finance, which recorded a monthly growth of 29.2% and Ajman Bank with a gain of 18.7%. On the other hand, the Materials index posted a monthly fall of 2.1% driven mainly by the 11% decline of shares of National Cement followed by a 1.2% decline in the Utilities index.

In terms of monthly trading activity, total volume traded rose by 14.1% to reach 3.1 billion shares in April-2023 vs. 2.7 billion shares during March-2023. Total value traded, meanwhile, declined by 10.8% to reach $1.63 billion in April-2023 as compared to AED $1.85 billion during March 2023. Union Properties topped the monthly volumes traded chart for the second consecutive month recording 409.4 million shares which changed hands during the month followed by Ajman Bank and Gulf Navigation Holding which saw 342.9 million and 295.5 million of their shares change hands during the month, respectively.

The Real Estate sector in Dubai remained vibrant during Q1-2023. According to analysis by global analysis consultant Knight Frank, Dubai recorded 88 home sales which were above $10 million price during Q1-2023.