DUBAI: Saudi Arabia’s stock market rose sharply in early trade on Sunday, climbing above technical resistance, as sentiment was helped by hopes for an end to the conflict in Yemen.
Former Yemeni president Ali Abdullah Saleh said on Saturday he was ready for a “new page” in ties with the Saudi-led coalition fighting in Yemen if it stopped attacks on his country, in a move that could pave the way to end nearly three years of war.
The Saudi stock index gained 1.0 percent to 7,075 points in the first 40 minutes, heading for an eighth straight day of gains. It rose above resistance around 7,000 points, which has capped the market since mid-October and roughly coincides with the 200-day average, now at 7,014 points.
A clean break of the resistance – at least two straight daily closes – would point up to around 7,250 points, acording to the height of the former downtrend channel dating back to mid-October.
“Recently the main force affecting the market has been geopolitics – it’s not surprising that the market rises when the outlook appears to improve,” said Hisham Tuffaha, vice-president for asset management at Mulkia Investment in Riyadh.
Rising stocks outnumbered losers by 172 to four. Cement stocks, long beaten down by the slump in Saudi Arabia’s construction industry, lead the gains, with Najran Cement and Southern Province Cement surging their 10 percent daily limits; cement and construction firms could benefit if the Yemen conflict ends and the country starts to rebuild.
The Saudi market has also been buoyed in recent days by easing worries about the impact of authorities’ crackdown on corruption, as some detained suspects reach settlements with the government and the number of frozen bank accounts falls after exceeding 2,000 at one stage.
Qatar’s index edged up 0.3 percent with drilling rig provider Gulf International Services jumping 4.7 percent.
Source: Brecorder.com
