DUBAI, Nov 7 (Reuters) - Optimism in the global stock and oil markets may help lift shares in the Gulf on Monday, while Egypt’s index may extend gains as investors re-price assets to reflect the recently floated currency.
MSCI’s broadest index of Asia-Pacific shares outside Japan advanced 0.7 percent after the FBI said it stood by its earlier recommendation that no criminal charges were warranted against Democrat Hillary Clinton.
Brent futures were trading at $46.00 per barrel, up 0.9 percent, from Friday’s close, when the commodity settled at its lowest close since August.
Dubai’s index, which has been lagging behind its regional peers, may get a boost from the improved global environment and the quarterly earnings from two developers that came above expectations.
Emaar Malls, a unit of Emaar Properties, reported a 16 percent rise in third-quarter net profit of 435 million dirhams ($118.4 million), as against an EFG Hermes forecast of 421.8 mln dirhams.
DAMAC Properties reported an 11.7 percent fall in third-quarter net profit on Monday as revenue slipped. The developer reported a net profit of 902.0 million dirhams ($245.6 million), but this came above the 707.0 million dirhams EFG Hermes forecast.
In Egypt, the equities index of the 30 most valuable stocks has been rallying since the central bank floated its currency at the end of last week as investors hope the market-priced Egyptian pound will help resolve the dollar shortage that has crippled the economy for several years.
Foreign investors, many of whom were absent from Sunday’s trade for their week-end break, may be attracted to buy the now cheaper Egyptian equities.
“Falling costs of equity and a resulting expansion in valuation multiples will likely be a major driver of EGX30 performance over the next 12-month period - the market is trading well below average on price-to-book,” EFG Hermes said in a note (Reporting by Celine Aswad; Editing Sunil Nair)