All seven Gulf markets advanced on Monday, spurred by Saudi Arabia's surge the previous day as institutional buying swelled trading volumes. Brokers said investors are increasingly optimistic and believe the likely effects of the credit crunch and global recession on the Gulf economies may have been exaggerated. “A lot of clients are thinking they may have missed the bottom of the market and so we're seeing rising institutional flow coming in,” said Matthew Wakeman, EFG-Hermes managing director for cash and equity linked trading. This translated into significant gains across the region. The Saudi Tadawul stock market further gained ground on Monday, closing 1.63 percent higher at 5,082.54 points. Fourteen out of the 15 Tadawul sector indices advanced, with real estates posting the biggest gain (up 2.82 percent). Shares in Ar Al Arkan, a leading real estate developer in the Kingdom, added 6.8 percent. Saudi Cooperative Insurance (SAICO) declined 3.68 percent on profit bookings, its first loss since March 22 2009. Saudi Arabia's insurance sector has been moving up significantly over the past four to five months and should continue to outperform the market, with big expansions expected this year,” says Youssef Kassantini, head of private banking at Rasmala Investment Co. Kuwait index has increased by seven percent since the government a bailout package for its struggling financial sector on March 26. The Abu Dhabi index ADI rose for the third session running, climbing 0.54 percent to 2,556 points and a three-month high. Aldar Properties jumped 7.4 percent and Sorouh Real Estate added 3.5 percent. Investors expect the tortuous merger of rival Dubai-based mortgage lenders Amlak Finance and Tamweel to be concluded this month, which should boost home lending in the UAE, said Ali Khan, head of cash-equity trading at Dubai-based Arqaam Capital. “It's not going to solve all the mortgage market's problems, but the new entity should be a shot in the arm for real estate and will spur expectations of consolidation in the property sector,” added Khan. Dubai's index DFM fell 0.27 percent to 1,621 points, its fourth reverse in six sessions as all of its 10 largest stocks failed to advance. Regional markets have been among the hardest hit during the global downturn.
