Gulf stock markets consolidated in early trade on Sunday because of a lack of positive factors and sluggish global bourses, but Saudi Arabian banks continued to rally.
Saudi Arabia’s index edged up 0.3 percent in the first 30 minutes as banks, which have led the market up for seven straight days in response to Riyadh’s mammoth international bond sale, gained 0.6 percent.
The biggest lender, National Commercial Bank, surged 3.2 percent. Late on Thursday, the central bank announced fresh steps to ease a liquidity crunch caused by low oil prices, lowering the maximum volume for its Treasury bill issues and introducing a new 90-day repurchase instrument to inject funds into the money market when needed.
Those steps in themselves look unlikely to make much difference to banks. But investors took them as a sign that authorities are determined to improve liquidity, and may therefore also disburse more stalled government payments to construction firms and other creditors of the state. That should help bank loan quality.
Dubai’s stock index was flat although Union Properties added 1.9 percent. Abu Dhabi’s index gained 0.2 percent as telecommunications giant Etisalat rose 0.8 percent.
Qatar’s index dropped 0.5 percent as Commercial Bank of Qatar sank 2.5 percent after saying it planned to convene shareholders to seek approval to increase its capital through a rights issue; it did not give details.
Widam Food rose 1.5 percent after reporting a 31 percent jump in third-quarter net profit.