Market Wrap MENA 2 August: Egypt Leads With a 1.6 Percent Gain as the Gulf Rises

By The Edge Research Team

Gulf and Egyptian markets opened the week broadly higher on Sunday, with every regional benchmark in positive territory, as the region traded the OPEC+ meeting on September output and the global technology rally that had swept world markets on Friday. Egypt’s EGX30 led with a 1.58 percent gain and Qatar’s QE Index rose 1.31 percent, while Saudi Arabia’s Tadawul added 1.10 percent, per the exchanges.

The Gulf advance was broad. Saudi Arabia’s Tadawul All Share Index rose 1.10 percent to 10,705.87 and the MSCI Tadawul 30 added 1.03 percent to 1,438.12, while Qatar’s QE Index gained 1.31 percent to about 10,050.65, our calculation from the prior close. Kuwait firmed, the Premier Market up 0.49 percent to 9,261.01 and the All Share 0.45 percent to 8,796.46, and Jordan’s Amman bourse rose 0.41 percent to 4,012.56. Oman’s MSX 30 added 0.25 percent to 7,295.45 and Bahrain’s All Share edged up 0.08 percent to 1,957.99, leaving the whole region in the green.

In Egypt, the benchmark EGX30 climbed 1.58 percent to 54,285.86, its strongest regional showing, while the pound firmed. The Egyptian pound strengthened about 1.57 percent to 50.30 per dollar, pulling back below the 51 line it had crossed the previous week, an easing of the external pressure that had built as oil rose.

The region reopened into a firmer global backdrop set on Friday, when a historic rebound in semiconductor and artificial-intelligence shares swept Asia and Wall Street extended its rally. That backdrop, together with the OPEC+ meeting on Sunday to decide September output, framed the Gulf’s session, our reading.

Asia had led Friday’s moves. South Korea’s Kospi had surged a record 17.91 percent and the Kosdaq 11.63 percent, while Taiwan’s Taiex jumped 7.98 percent and Japan’s Nikkei 225 rose 4.03 percent, per CNBC, in a chip-driven melt-up. China’s Shenzhen Component had added 2.21 percent and the Shanghai Composite 0.72 percent.

In the UAE, which trades a Monday-to-Friday week and was closed on Sunday, the latest prints are Friday’s closes: Dubai’s DFM General Index had edged up 0.07 percent to 5,795.93 and Abu Dhabi’s FADGI had risen 0.36 percent to 9,914.62, per the exchanges.

Europe had closed mixed on Friday. France’s CAC 40 rose 0.28 percent and the Euro Stoxx 50 0.21 percent, while Germany’s DAX was little changed at plus 0.07 percent and Britain’s FTSE 100 eased 0.27 percent, per CNBC.

Wall Street had ended Friday higher, extending its rebound. The Nasdaq Composite had risen 1.00 percent to 25,373.85, the S&P 500 0.70 percent to 7,489.78 and the Dow Jones Industrial Average 0.53 percent to 52,485.74, per CNBC, led by a surge in Amazon even as Apple fell.

The commodity backdrop was last priced on Friday and closed over the weekend. Brent crude had settled at 90.09 dollars a barrel, up 1.19 percent, and West Texas Intermediate at 84.79 dollars, higher by 1.44 percent, while gold eased 1.26 percent to 4,108.30 dollars an ounce, per CNBC. Bitcoin, which trades through the weekend, was up 0.98 percent at about 63,076 dollars on Sunday.

Why it matters: The broad regional advance shows the Gulf trading a supportive mix, our reading. Firmer oil into the weekend and the OPEC+ meeting on September output frame the revenue outlook for producers such as Saudi Arabia, Kuwait, Qatar and Oman, while the global return of risk appetite, led by Friday’s record chip rally in Asia, lifted sentiment across regional equities as they reopened. For Egypt, the pound’s move back below 51 to the dollar eases the external pressure that had built during the oil surge, a supportive backdrop for Cairo’s equities, which led the region on Sunday.

Outlook: The immediate markers are how the region absorbs the OPEC+ September output decision and whether oil holds its gains near 90 dollars on Brent when markets reopen fully, our reading. Global risk appetite, set by whether Friday’s technology rally holds and by the US July jobs report due at the end of the week, will steer sentiment, while the Egyptian pound’s path around the 51 line remains the currency marker to watch.

MENA markets, 2 August close, ranked by change

Asia, Friday 31 July close, for reference, ranked by change

UAE, Friday 31 July close, for reference, ranked by change

Europe, Friday 31 July close, for reference, ranked by change

United States, Friday 31 July close, for reference, ranked by change

Commodities, rates, currencies and crypto (Friday close; regional FX and crypto to Sunday)

Sources: Saudi Exchange; Boursa Kuwait; Qatar Stock Exchange; Bahrain Bourse; Muscat Stock Exchange; Amman Stock Exchange; Egyptian Exchange; Abu Dhabi Securities Exchange; Dubai Financial Market; CNBC.

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