March has been a month of strong turnaround for the GCC markets. After positing 10 consecutive months of negative returns, the GCC markets turned around and posted a 7.94% return for March 2009. All the GCC markets posted positive returns in the month of March 2009, except Oman’s Muscat Stock Market, which lost 4.64%. The Kuwait markets led the GCC markets by posting a 15% return. This trend was not isolated only to the GCC markets, the global markets (MSCI World index) and the Emerging markets (MSCI EM) also witnessed a turn around and posted 8.29% and 10.44% return respectively.
In March, volume traded in GCC markets was up 12.6% to 25.4 Bn shares whereas value traded decreased by 4.3% to USD 34.9 Bn. The UAE market topped the charts in terms of contribution to overall volume traded in the GCC, with 46% of the total while Saudi Arabia contributed the most to value traded, with 67% of total value traded in the GCC in March.
M. Cap (USD Bn) Last Mar 2009 YTD 2008 P/E P/E
Indicators Close % % % 2008 2009
Saudi (TASI) 231 4704 7.28 -2.07 -56 12 9
Kuwait SE WT.INDEX 88 358 10.37 -11.91 -43 12 5
Abu Dhabi (ADI)^ 70 2488 4.69 4.10 -48 11 6
Qatar(Doha SM) 39 4887 10.12 -29.03 -28 9 5
Dubai (DFMGI) 33 1568 0.61 -4.15 -73 - -
Bahrain (BAX) 17 1596 1.16 -11.54 -35 6 5
Oman(Muscat SM) 10 4629 -4.64 -14.93 -40 6 5
MSCI GCC Index 316 306 8.48 -11.51 -57 10 7
Source: Excerpt from Markaz ‘Daily Morning Brief’ March 1, 2009
^ PE is for UAE in totality, CY08 Estimates are Markaz Earnings Estimates
Volatility (as measured by the Markaz Volatility Index)
Directionally, volatility levels have declined significantly from their peaks in Sep/Oct 08. In March six out of the 12 markets we track have witnessed an increase in volatility levels. The two GCC markets Kuwait and Bahrain continue to witness low volatility levels as compared to the emerging markets and even the S&P 500.
Comparable MVX Levels as of March 31, 2009
Source: Markaz Research
Saudi Arabia’s Tadawul All-Share Index (TASI) gained 7.28% MoM in March, after losing 8.82% in February. The Tadawul’s gain was led by SABIC and STC, which gained 14% and 12%, respectively, for the month.
For March, the total volume and value traded stood at approximately 4.9 Bn and USD23.34 Bn, respectively, an MOM decrease of 9% and 14%, respectively. Concentration of the top five stocks in terms of volume and value traded to total market capitalization stood at 19%.
The Kuwait Index gained 10.37% in March, after losing 8.24% in February. The Index’ increase was pushed by the Food and Banking sectors, which increased by 20.10% and 11.23%, respectively, for the month. The only sector index to see a loss was Insurance and Real Estate, which lost by 19.21% and 1.51%, respectively during the month.
The total volume traded in Kuwait increased by 45% in February, while total value traded gained 35% to USD 5 Bn in the same month. Concentration of the top five stocks in terms of volume and value traded to total market capitalization stood at 1% and 34%, respectively.
United Arab Emirates
The UAE markets ended the month on a positive note; the Dubai Financial Market (DFM) gained 0.61% while the Abu Dhabi Exchange (ADX) gained 4.69%. On a market cap weighted basis, the markets gained 3%. Dubai’s gain was constricted by declines in the Materials and Banking sectors, which fell by 5.00% and 4.40%, respectively. Abu Dhabi’s gain was due to gains in the Energy and Telecommunications sectors, 20.53% and 13.73%, respectively.
The total volume traded in UAE increased 6% to 11.6 Bn, whereas the total value traded decreased by 4% to USD 3.9 Bn in March. Concentration of the top five stocks in terms of volume and value traded to market capitalization was 12% and 29%, respectively.
The Doha Stock Market (DSM) went up 10.12% in March following a 15.52% loss in February. Gains on the DSM were led by the Industrial and Banking sectors, which gained 17% and 10%, respectively, in March.
In March, total value traded on the DSM surged 86% to equal USD 2.1 Bn while total volume traded increased by 59% to equal 319 mn. Concentration of the top five stocks in terms of volume and value traded to market capitalization was 18% and 39%, respectively, in March.
The Muscat Securities Market (MSM) lost a 4.64% in March after a marginal gain of 0.83% in February. All sector indices saw declines in March, except the Industrial sector, which gained 6.92%. The largest decline was in Services and Insurance which lost 7.04%. During March, total volume traded increased 30% to 402 mn while total value traded doubled to USD 478 mn from USD 237 mn.
The Index gained 1.16% in March after ten consecutive months of losses. March’s gain was constricted by losses in the Services, Industrial, and Hotel & Tourism sectors, of 7.61%, 6.98%, and 3.02%, respectively.
In March, total value traded increased 0.51% to USD 54 mn while total volume increased 72.31% to 89 mn. Concentration of the top five stocks in terms of volume and value to the market capitalization was 7% and 11%, respectively.
About Kuwait Financial Centre “Markaz”
Kuwait Financial Centre S.A.K 'Markaz', with total assets under management of over KD. 880 million as of December 31, 2008 was established in 1974, and has become one of the leading asset management and investment banking institutions in the Arabian Gulf Region. Markaz was listed on the Kuwait Stock Exchange (KSE) in 1997; and was awarded a BBB+ corporate rating by Capital Intelligence Ltd.