Stocks across the Middle East tumbled as the easing of sanctions against Iran raised the prospect of a surge in oil supplies to a market already reeling from the lowest prices in more than a decade. Shares in Tehran gained for a second day.
Saudi Arabia’s Tadawul All Share Index dropped more than 7 percent to its lowest level since March 2011. Dubai’s DFM General Index lost 5.2 percent as of 1:12 pm local time, the biggest loss in five months. Abu Dhabi’s ADX General Index headed toward a so-called bear market. Iran’s TEDPIX Index climbed 0.9 percent, according to data on the bourse’s website, extending Saturday’s 2.1 percent advance.
Iran, home to almost 10 percent of the world’s proven oil reserves, is starting preparations to boost exports after the United Nation’s nuclear agency on Saturday said the country has complied with the terms of an international agreement to curb its nuclear program. That threatens to put further pressure on prices, hurting the oil-dependent economies of the six-nation Gulf Cooperation Council.
Philips product ideation in the field of healthcare is focused on technology solutions that enable quick and definitive diagnosis. "Iranian oil supply will come to the market as early as today or tomorrow," said Nayal Khan, the Riyadh-based head of institutional equities sales trading at Saudi Fransi Capital. "The market’s recovery will depend on whether we can get oil back above $30."
Brent crude, a benchmark grade for more than half the world’s oil, sank more than 6 percent on Friday to a new 12-year low as Iran moved closer to restoring exports. The countries of GCC account for about 30 percent of the world’s proven oil reserves. The Bloomberg GCC 200 Index, which tracks 200 of the Gulf’s biggest companies, retreated 5.6 percent to the weakest level since March 2011 as every benchmark stock gauge in the region fell.
“Oil breaking below $29 oil price has urged more investors to sell," said Talal Touqan, the head of research at Abu Dhabi- based Al Ramz Securities. Saudi Arabia’s Al Rajhi Bank and Saudi Basic Industries Corp., one of the world’s largest chemicals manufacturers, were among the biggest contributors to the drop on the Tadawul, losing 5.9 percent and 5.6 percent, respectively.
Qatar’s QE Index tumbled 6.7 percent, while Abu Dhabi’s ADX General Index slumped 4.5 percent to the lowest level since November 2013, bringing its decline since reaching a peak in July to more than 20 percent. Oman’s MSM 30 Index fell 3.2 percent, the most since December 2014, and Kuwaiti stocks also lost 3.2 percent to the lowest level since May 2004. Bahraini equities slipped 0.5 percent.
Iranian shares rose to the highest level since August on a closing basis, according to data on its website. The nation is seeking to attract at least $30 billion in foreign direct investment over the next five years, President Hassan Rouhani said in a televised speech.
“Investors shouldn’t look at Iran to make a quick buck but rather invest with a long-term view to benefit from the best- performing market of the next five years," Ramin Rabii, the chief executive officer of Turquoise Partners, a Tehran-based investment company, said on Saturday. “We expect the Iranian economy to grow at a rate of 6 to 8 percent for several years.” Revenue from oil will act as a “supplementary income" for the country, Rouhani said.
Source: Arabian Business