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From: Mahmoud Jamal
Mubasher: Analysts expect Mubasher to continue its mixed performance in Thursday's session after the Federal Reserve's historic decision to cut interest rates due to five factors, including declining global markets and the continued disclosure of mid-term results of listed companies, and the situation of the geopolitical region.
After two days of meetings, the US central bank lowered its interest rates by 25 basis points, from 2.25% to 2.25% for the first time in more than 10 years since 2008.
After this landmark decision, remarks by the US Central Bank's president, which lowered expectations of further easing of monetary policy in the future, affected world markets, especially the record losses recorded by the US central bank. United States.
By the end of Wednesday's session, the performance of the Gulf stock markets has varied and the Dubai market has risen slightly to maintain its third consecutive rise, while the Saudi market has fallen due to losses in the petrochemical sector.
Increased shopping centers and purchases
Ibrahim al-Failakawi, economic adviser of "Mubasher" The historical price decision on the markets and operated by the governor to buy and increase the positions of leadership shares, which have reached low levels in recent sessions.
He explained that the decision would be reflected in today 's session on the banking sector, which should witness the time required for profit taking affected by the decision.
"In addition, it is possible to start seeing real estate valuations that should yield good results and whose projects are growing at a steady pace because the interest rate decision allows companies in the sector to borrow cheaply from banks , which supports their operational activity.
In general, the reversal of the decision will have a positive impact on the stock markets but will appear in the medium term, especially after the governor's return from the seasonal vacation period started.
The official holidays are the summer period, the school holidays and the upcoming holidays of Eid al-Adha and the advent of the pilgrimage season, "the period during which many Gulf countries are prepare for the holidays or this duty ".
He said that these factors allowed the markets to regain their composure and that it was possible to see during this period partial correction phase indicators, which started the Saudi market for four or five sessions. The Saudi index fell slightly at the end of the session yesterday by 0.1%.
Disappointing results
He pointed out that the investor was monitoring other important factors in the region's markets, including medium-term results revealed by large companies, some of which disappointed investors such as SABIC, which recorded lowest quarterly earnings since the end of 2009, Almost years.
Ibrahim al-Filakawi explained that one of these factors is the geopolitical situation and its stability. The United Arab Emirates Ministry of Foreign Affairs has expressed satisfaction with the security of the ports after the coastguard meets with their Iranian counterparts.
The talks come after weeks of increasing tensions in the Strait of Hormuz after escalating tensions between Tehran and Washington, the main ally of the Gulf.
State budgets
He pointed out that one of the main factors determining the evolution of stocks in the coming period until the end of August was the budgets of the countries of the region, which would explain in detail the projects of sovereignty to invest in companies contributing to the financing of companies listed on the financial markets of these countries.
Saudi Arabia's budget deficit for the first half of this year fell from 41.7 billion riyals to 5.7 billion riyals in the same period last year, according to a report by the Ministry of Foreign Affairs. Saudi finance published a day ago. These figures reflect an 86% reduction in the deficit.
The total revenue of the Saudi general budget in the first half of this year increased by 15%, while total expenditure increased by 6% over the same period.
Earlier this month, some Gulf markets are interested in emerging markets and global markets in general. In August, MSCI will launch the second phase of listing Saudi equities in its Emerging Markets Index, which could add additional inflows of foreign funds from $ 6.3 billion to $ 8.2 billion.
Continuous optimism
For his part, badyst Mona Mustafa, a member of the Scientific Committee of the African Economic Council, expected to maintain the optimism of brokers in the UAE markets, especially with the announcement of positive commercial results for companies that will support movements of the main titles.
She said that Emirati shares are currently the most attractive for foreign institutions. He pointed out that some Gulf markets are subject to limited profit taking operations targeting major stocks on the impact of the results and the arrival of cash at low levels before the holidays. Eid.
Middle East funds plan to increase investment in the UAE, while exposure to other countries in the region will remain at current levels, according to a recent survey.
Prices are cheaper
A previous report from Bloomberg confirmed that Dubai stocks have regained their attractiveness and are now trading at relatively cheaper prices than other emerging market equities, enhancing their attractiveness and strengthening investors' appetite for trading. .
The difference between Dubai's estimated stock price and the value of its expected earnings is close to its highest value in 2011, the report says.
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