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MIDEAST STOCKS-Brent breaking $50 may lend support to Gulf bourses
May 26, 2016 / 5:46 AM / a year ago

MIDEAST STOCKS-Brent breaking $50 may lend support to Gulf bourses

DUBAI, May 26 (Reuters) - A break above $50 a barrel in Brent prices looks set to lift bourses in the Gulf on Thursday.

Some risk appetite has been returning to Gulf bourses as oil prices climbed back to hit their highest levels since November 2015 and as global equity markets edged higher. On Wednesday, the S&P 500 gained 0.7 percent and the Dow Jones industrial average closed up 0.8 percent.

Some investors may now be encouraged to rebalance their portfolios in favour of oil-related shares, which have been the backbone of the recent rebound in Saudi Arabia’s index.

But gains may be capped as valuations have now been pushed higher and as investors remain cautious about the ability of firms in the Gulf to generate higher returns in a business downcycle and as subsidy cuts weigh.

Bahrain-based GFH Financial Group plans to list its subsidiary Khaleeji Commercial Bank in Dubai and acquire a financial services company to increase shareholder value, GFH’s chief executive said on Wednesday at a public event to discuss GFH’s plans.

Shares in GFH Financial have doubled over the last 6 months. (Reporting by Celine Aswad; Editing by Sunil Nair)

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