Saudi banks and petrochemical stocks, the two heaviest sectors on the index led the Kingdom's recovery from Tuesday's sharp fall and five-month low, amid improved global sentiment. Sentiment was lifted across the Gulf with most markets making decent gains. Saudi Arabia's benchmark Tadawul All Share Index gained 0.51 percent to close at 6,039.32 points Wednesday. "We saw an over-reaction for oil price fall," said Sebastien Henin, portfolio manager at The National Investor. "Some of these companies didn't follow oil price when it went up in last six months, so the price correction shouldn't be so sharp - you can accumulate names at these levels. Yansab is interesting at these levels, also Boubyan Petrochemical." Yanbu National Petrochemical Co. (Yansab) climbed 0.7 percent, Saudi Arabian Fertilizers Co. (Safco) gained 1.2 percent and Saudi Basic Industries Corp. (SABIC) ended 0.5 percent higher. The banking index climbed 0.7 percent, with Samba Financial Group leading gains, rising 2.8 percent. Both the UAE and Qatar's bourses halted losses, helped by gains in global shares after the US Federal Reserve made a pledge to keep interest rates near zero for at least two years. Dubai's benchmark ended 1.2 percent higher at 1,461 points, rebounding from Tuesday's five-month low. It lost a 100 points in the last three day as markets region-wide plunged on concerns the US is heading back into recession, worsened by the country's credit rating downgrade. The emirate's bellwether Emaar Properties gained 1.5 percent, Arabtec ended 3.1 percent up. "We have seen a strong correlation in both ways with international markets but the consequences of all this mess should be less important here than in Europe or US," said Henin. Abu Dhabi's index closed 1 percent higher at 2,603 points. Kuwait's index ended 0.3 percent higher at 5,901 points, halting a five-day decline that dragged it to a seven-year low. In Qatar, the measure rose from a five-month low, gaining 0.7 percent to end at 8,128 points. Oman's Renaissance Services dragged Muscat's shares lower although other regional bourses gained as an interest rate freeze in the United States buoys investor sentiment. The stock dropped 2.2 percent, ahead of its quarterly earnings results expected before Aug. 16. Abu Dhabi National Energy Co. (TAQA) jumped 4.3 percent, after rising as much as 7 percent earlier in the session following its report that second quarter net profit nearly tripled. "There is strength across the region in names that were hammered in the last few days. It's too early to come back aggressively in the market, except for stock picking," said Henin. Certain telecoms names and petrochemical companies are looking attractive at current levels, he added. Gainers outnumbered losers 15 to two. Barwa Real Estate gained 2.5 percent, Masraf Al Rayan rose 1.8 percent. "The market seems to be spooked by the potential write-downs of two legal cases the company is facing and a further write down from Renaissance's postponed IPO," said a research note by EFG-Hermes. "Operationally, the company's fundamentals remain strong." "The negative sentiment continues here, with selling in the services sector from speculators," said Adel Nasr, United Securities brokerage manager. "The main thing we are still worries about is the global market."
