Friday 5 June 2009

Gulf markets rally running out of steam

Gulf stock markets could suffer a double-digit correction as a slump in summer trading and little improvement in the wider economy spark selling across key sectors, analysts said.

The rally — four of seven markets are at 2009 highs in rising volumes — is unlikely to be sustained, not only because stocks are overpriced but because the economic downturn is expected to send many wealthy expatriates home for good.

“I think we’re looking at a serious round of profit taking before the end of June,” said Sanyalaksna Manibhandu, Emaar Saudi Financial Services head of research.

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