Saudi bourse gains on rising oil prices; Egypt falls | Reuters
Saudi Arabia's stock market ended higher on Sunday in response to Friday's rise in oil prices, while the Egyptian index was in the red on profit-taking.
Oil prices - a key catalyst for the Gulf's financial markets - rose over 2% on Friday after energy firms posted positive earnings and U.S. data showed crude output was declining while fuel demand was growing.
EIA data this week showed U.S. crude oil and gasoline inventories fell more than expected last week as demand for the motor fuel picked up ahead of the peak summer driving season.
Saudi Arabia's benchmark index (.TASI) added 0.3%, with Retal Urban Development Co (4322.SE) advancing 2.9% and Dr Sulaiman Al-Habib Medical Services (4013.SE) closing 2.8% higher.
Elsewhere, oil giant Saudi Aramco (2223.SE) added 0.8%.
In Qatar, the index (.QSI) added 0.4%, with petrochemical maker Industries Qatar (IQCD.QA) rising 1.5%.
Outside the Gulf, Egypt's blue-chip index (.EGX30) declined 0.7%, with El Sewedy Electric (SWDY.CA) sliding about 3%.
Egypt is strongly considering approving the currencies of its commodity trade partners, including China, India and Russia to try to lessen the need for dollars, Supply Minister Ali Moselhy told reporters on Saturday.
Emirates Steel Arkan considering options after report on Thyssenkrupp stake bid
Emirates Steel Arkan, the largest public steel and building materials business in the UAE, said it continuously evaluates options to expand its business after a media report earlier this week said the Abu Dhabi state-backed group is pursuing a potential investment in Germany’s Thyssenkrupp’s steel unit.
Emirates Steel Arkan is emerging as the most serious contender to buy a stake in the Thyssenkrupp business and could make a formal bid in the coming months, Bloomberg reported on Wednesday, citing sources.
“We are aware of the media reports that have been published in the last 48 hours,” Saeed Al Remeithi, group chief executive of Emirates Steel Arkan, said in a statement on Friday to the Abu Dhabi Securities Exchange, where its shares are traded.
“However, the relevant discussions are at a very preliminary stage and no terms in respect of any potential transaction have been reached. Any material information relating to a transaction will be announced in compliance with applicable regulations and disclosure requirements.”
Saudi's PIF intends to create 1.8mln jobs: Al-Rumayyan
Yasir Al-Rumayyan, governor of the Public Investment Fund (PIF), said that the total volume of the PIF’s assets under management amounted to more than SR2 trillion.
“The PIF has been instrumental in creating more than 500,000 direct and indirect jobs, and it intends to create 1.8 million direct and indirect jobs,” he said in remarks on the occasion of the 7th anniversary of the launch of the Saudi Vision 2030.
Al-Rumayyan said that the Saudi sovereign wealth fund has established a total of 71 companies since 2019 in many strategic and vital sectors. “The PIF intends to inject up to SR1 trillion into new projects locally, and it is also moving steadily to consolidate its position as the most preferred investment partner globally,” he said.
The PIF chief also unveiled the fund’s ambitious plans. “Today we are beginning a new phase of achievements in which the fund confirms its commitment and continuity in achieving its goals by the end of 2025, including contributing to the non-oil gross domestic product (GDP) by about SR1.2 trillion and that the size of its assets exceed SR4 trillion.”
Al-Rumayyan pointed out that the PIF occupies an advanced and influential rank among the sovereign wealth funds in the world. “The fund will continue its efforts to diversify the economy, support local content, develop innovative opportunities for the future, and contribute to creating an attractive environment for investments,” he added.
Kuwait banking sector records highest growth in total assets
With banks looking to navigate through pandemic driven difficulties toward economic recovery and stability, KPMG published the eighth edition of its GCC listed banks’ results. Titled ‘Cautious optimism,’ the report offers a thorough analysis of the financial results and key performance indicators (KPIs) of leading listed commercial banks in the region, in comparison with the previous year, to highlight the main financial trends in the GCC countries.
Bhavesh Gandhi, Partner and Head of Financial Services, KPMG in Kuwait, said, “There are promising indicators of steady financial growth in Kuwait. Our results point out double-digit y-o-y growth in total assets and net profit by average in Kuwait, which is optimistic considering banking sector in the country is fresh off the COVID-19 crisis. It is expected that banks will press forward aggressively in certain aspects, such as digital transformation, but the collective disposition for growth will remain cautious.” Compared to 2021, Kuwait’s banking sector witnessed the highest y-o-y growth in terms of total assets (by average) in the region, climbing by 21.4 percent. Kuwait’s banking sector’s net profit (by average) also had the most significant growth rate in the region, increasing by 36.3 percent to reach 412.9 percent for the year 2022. Kuwait’s banking sector’s y-o-y growth with regard to coverage ratios on stage 3 loans was also the highest, rising by 7.1 percent compared to 2021. Albeit marginal, Kuwait’s banking sector’s returns on equity and assets grew by 0.8 percent and 0.1 percent, respectively.
In terms of average capital adequacy ratio, the banks in Kuwait had a healthy percentage of 17.3 percent, compared to the 18.3 percent in 2021, and well above the 12 percent limit required by the Central Bank of Kuwait. However, the banks in Kuwait saw an increase in the cost-to-income ratio which went up by 4 percent to reach 46.6 percent, compared to the 42.9 percent in 2021.
The following salient findings emerged from the financial results’ analysis for the year-ended 31 December 2022 for the GCC region as a whole:
