Abu Dhabi: The ongoing rally on the region's stock markets is set to continue this week, supported by surging international crude oil prices, higher volumes of trade and return of foreign investors, analysts say.
"The volumes are picking up across the GCC markets. The markets in Abu Dhabi, Dubai and Saudi Arabia traded higher last week and we are likely to see some more upside moves," Mousa Haddad, head trader of National Bank of Abu Dhabi Asset Management, told Gulf News by telephone.
"Any correction is a buying opportunity. We are particularly bullish on Saudi, Qatar and the UAE markets and cautiously bullish on Egypt. Saudi Arabia's market, which is bracing itself to cross the 7,000 level, may open to direct investment by foreigners by June.
Broad data
"Should that happen, the market there will fly on the back of the strength of the country's banking, petrochemical and real estate sectors," Haddad added.
Gary Dugan, chief investment officer — private banking at Emirates NBD, wrote in a research note the global markets could still go higher. "The broad economic data has surprised to the upside. Also, investors have been slow to accept the better news and have largely remained very committed to bonds and cash. To date there has not been a major move by investors out of cash and bonds and into equities. However, to our mind it is still worth being cautious, particularly given the major challenges in Europe and the still very tight monetary conditions that exist in Europe despite the best efforts of the European Central Bank," Dugan said.
"Banks are still struggling and have little appetite to lend to their customers. Limited risk appetite on the part of banks always restrains growth. In the US, as the year progresses, there will likely be more focus on the challenges facing a new presidency, in particular the massive deficit that will need reining in through 2013."
