Gulf may gain as oil, Asian bourses start 2017 strong
* In the Gulf region, the petrochemical sector in Saudi Arabia may get a boost from the rise in oil prices
* Brent crude oil is at $57.16 a barrel, close to last year’s high of $57.89
* Both crude oil prices and Asian bourses started their first trading day of 2017 with a firm tone
Stock markets in the Gulf may rise on Tuesday as both crude oil prices and Asian bourses start their first trading day of 2017 with a firm tone.
MSCI’s broadest index of Asia-Pacific shares outside Japan is up 0.4 per cent as most regional markets reopen after New Year holidays. Brent crude oil is at $57.16 a barrel, close to last year’s high of $57.89, hit on December 12.
Most activity in Dubai, where the index rose 0.2 per cent on Monday, was by short-term speculative investors as many institutional and foreign funds were away for the holidays. They may start returning on Tuesday, bidding up prices of large-cap shares.
The petrochemical sector in Saudi Arabia, which lagged slightly on Monday, may get a boost from the rise in oil prices. Many analysts expect the sector’s fourth-quarter earnings to show improvement from the prior-year period.
Aljazira Capital said in a note that it expects sales in the final quarter of 2016 to have increased on a quarter-on-quarter basis, though margins may have contracted because of higher feedstock prices.