GCC equity market index up 40% in 2021; marks biggest gain since 2008 | ZAWYA MENA Edition

GCC equity market index up 40% in 2021; marks biggest gain since 2008 | ZAWYA MENA Edition

The GCC equity market index closed 2021 with a gain of 34.9 percent, marking the biggest gains since 2008, according to a report by Kamco Invest.

The MSCI GCC index has fully recovered from COVID-19 and the oil-led decline of 3.7 percent in 2020 as all the markets in the GCC reported gains during the year.

Abu Dhabi was the best performing market amongst prominent equity markets globally with a gain of 68.2 percent.

Saudi Arabia supported Abu Dhabi's gains with 29.8 percent returns. Dubai and Kuwaiti benchmarks followed with gains of 28 percent and 27 percent respectively.

Gains for both Saudi Arabia and ADX were driven by listing of several state-owned firms amid a climate of economic optimism, large scale projects and timely execution of plans.

Several new initiatives were taken in the GCC that mainly aimed at diversifying state revenues away from oil and at the same time making sure that their market share in the oil market remains robust by way of adding capacity, said Kamco.

In terms of sector performance, the financial services sector topped. Diversified Financials had a return of 62.2 percent followed by Banks with a gain of 48.8 percent. The Capital Goods index was next with a gain of 45.4 percent followed by Materials and Healthcare with gains of 30.6 percent and 27.7 percent, respectively.

On the decliners side, Food & Beverage recorded a decline of 8.9 percent closely followed by Food & Drug Retailing with a decline of 8.3 percent. Other last year’s outperformers like Pharma & Biotech, Consumer Durables & Apparels, and Insurance also reported low single digit gains.

Trading activity in the GCC remained upbeat and recorded gains for the third consecutive year to reach $789.7 billion, a growth of 19.7 percent from $659.8 billion recorded in 2020. This was the highest level of trading activity for the region since 2014.

All the individual exchanges in the region reported higher trading activity in 2021, barring Bahrain. Abu Dhabi reported the steepest increase in trading activity with five-fold growth in value traded increasing from $19.3 billion in 2020 to $96.22 billion in 2021 resulting a share of 12.2 percent vs. 2.9 percent in 2020.

Saudi Arabia’s share, on the other hand, declined from 84.3 percent in 2020 or $556.4 billion to 75.5 percent or $596.3 billion in 2021.