Abu Dhabi recovers, Saudi petrochemicals buoyed by oil bounce
* In Abu Dhabi market, banking stocks sold off in previous session recovered
* Banks see drop after denying rumours about mergers
* Majority of listed petroch shares rose as Brent futures climbed
Abu Dhabi’s stock market index rebounded in early trade on Monday as some of banking stocks which were sold off in the previous session recovered, while Saudi Arabia rose as oil prices firmed.
Abu Dhabi’s index rose 0.9 percent after falling 1.7 percent on Sunday. Abu Dhabi Commercial Bank climbed 3.2 percent and Abu Dhabi Islamic Bank rose 0.3 percent.
On Sunday, Union National Bank dropped 5.2 percent and ADCB lost 2.7 percent after both lenders issued separate statements denying last week’s Bloomberg report that they were involved in merger talks. Similarly, ADIB pulled back 0.8 percent after the lender said that it has no plans to merge with Alhilal Bank.
Shares in UNB have yet to trade on Monday morning.
Dubai’s Shuaa Capital jumped 8.2 percent as investors were optimistic that its new shareholder, Abu Dhabi Financial Group, will unlock value for the investment firm. Shares in Shuaa are now trading roughly double the acquisition price of 0.705 dirham a share.
Shares in other second-tier companies, usually traded by local traders, also climbed, helping carry Dubai’s main index 0.3 percent higher. Builder Drake & Scull rose 2.8 percent.
Saudi markets up
Meanwhile, Saudi Arabia’s general index edged up 0.2 percent to 6,585 points after 20 minutes of trade, having closed down for two straight sessions.
“Even if the index rises, it is likely to face strong resistance between 6,700 – 6,875 points,” said a note by Riyad Capital.
The majority of listed petrochemical shares rose as Brent futures climbed back over $47 a barrel, with heavyweight producer Saudi Basic Industries adding 0.3 percent.