Earnings boost Gulf exchanges

Global markets have tumbled on concern over Europe’s indebted southern rim, but Gulf stock exchanges have fared better of late, thanks in part to a continued recovery in corporate profits in the first quarter.

Aggregated profits of listed Gulf companies rose 23.5 per cent year-on-year in the first three months of the year, and 66.7 per cent compared to the last quarter of 2009, according to data compiled by EFG-Hermes, the investment bank.

“The fourth quarter was probably when earnings bottomed out, and most provisions at banks and real estate companies are now accounted for,” says Saud Masud, head of research at UBS in Dubai.