November 05. 2008
Barack Obama’s triumph in the US Presidential elections drove stocks upwards in Asia and the GCC although the euphoric mood passed Europe by as traders cashed in on earlier gains.
The dollar also strengthened, while oil fell back under $68 a barrel and gold lost more than one per cent to $750.75 an ounce.
Gulf markets followed yesterday’s upward trend, with each of the seven GCC nations’ markets posting gains, led by strong trading in property and banking.
Gulf markets have made a slight comeback overall this week after shedding around US$250 billion (Dh918bn)of their value last month. They ended October valued at $720bn, an enormous $400bn down on the start of the year.
The day’s global surge began in Asia, with Japan’s Nikkei closing up 4.5 per cent and markets in Hong Kong, Singapore and Shanghai up three per cent. Australian and South Korean markets also responded positively to the election results, and closed up two per cent.
Dubai’s benchmark DFM rose 1.59 per cent to hit nearly 3,000 points but dipped again to end 0.06 per cent up at 2917.29. Abu Dhabi’s ADI bourse showed positive signs early on with a small lift in the morning, a trend carried through to the end of the day as it closed at 3435.61 points, a rise of 1.51 per cent.
Kuwait’s main index KWSE followed its recent gains yesterday and climbed 0.37 per cent in the morning but ended up nearly one per cent at 9785.8. Oman’s MSI Index was the best performing bourse in early trading and leapt 5.45 per cent and traders seemed to represent widespread confidence across the region, and instead of locking-in their earnings and selling they held on, with the market closing at 6989.75 points, up an impressive 5.89 per cent.
Jordan’s market in Amman also posted a decent rise and closed up 2 per cent, with Paletine and Egypt also ending the day on a positive note. The two bourses were up 1.03 and 0.75 per cent respectively. Markets in the region are still operating below-par, as stocks around the world struggle to gain ground on the $5.79 trillion lost last month, according to Standard & Poor’s Index Services.
European markets showed less certainty, with steep declines across the region. Traders, predicting the rises on the back of today’s presidential election, had pushed markets in the region up yesterday, but today sought to capitalise on the gains and sold frantically. The UK’s FTSE 100 Index lost 2.7 per cent to 4534.82, while France’s CAC-40 Index dipped 1.9 per cent to 3618.83. Germany’s DAX Index declined 2.1 per cent to 5166.07.
US traders seemed to follow the same sentiment and this afternoon the Dow Jones Stoxx 600 Index was 2.7 per cent lower at 227.10. The gauge has still rallied an impressive 18 per cent since inking a 2008 intraday low of 188.71 on October 24.
Meanwhile, light, sweet crude futures for December delivery traded at $67.88 a barrel, down $2.65, in electronic trading.
In other earnings news, BNP Paribas reported a third-quarter net profit decline of 56 per cent which forced its shares 5.3 per cent lower to €55.41 in Paris, while the Danish brewer Carlsberg lost 6.2 per cent to DKK241 as it posted a a lower-than-expected third quarter net profit and cut its full-year outlook.
The dollar rose against a basket of major currencies, after falling around 2.5 per cent yesterday for its biggest one-day drop in 13 years against the Yen.
* With Agencies
pdriscoll@thenational.ae
http://thenational.ae/article/20081105/BUSINESS/489090546/1043
