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Bloomberg
Saudi stocks climb the most in the Gulf, tracking a surge in oil prices after Opec+ shocked the markets with a decision to keep supply in check. Aramco advanced the most in five months.
The Tadawul All Share Index rises as much as 1.4%, extending gains this year to 7.9%. Saudi Basic Industries, Saudi Aramco and Al Rajhi Bank contributed the most to the advance. Benchmarks in Abu Dhabi, Kuwait and Oman also rise.
The Opec+ decision represents a victory for Riyadh, which has advocated for tight curbs to keep prices supported. Oil, the kingdom’s biggest export, jumped last week to $69.36 per barrel in London, the highest since May 2019. Goldman Sachs Group Inc. raised its second- and third-quarter forecasts for Brent to $75 and $80 a barrel, respectively.
Saudi Aramco rises as much as 2.3%, the most since September 2. Bank of America Corp. said the world’s largest oil company is “uniquely positioned†to meet potential resurgence of oil demand, and could generate close to $100 billion in free cash flow next year should bullish assumptions materialise.
Dividend upside is also seen as possible at higher oil prices and output “given Aramco’s stellar FCF generation,†analysts led by Karen Kostanian wrote in a note.
The MSCI emerging markets index ended the week unchanged at 1,339.31. The index is up 3.7% this year.
Adding to the positive sentiment, Saudi Arabia said it’ll ease some coronavirus-related restrictions as new cases in kingdom stabilised.
While clothing retailer Fawaz Alhokair rises 4.6%, fitness clubs chain company Leejam Sports gains as much as 5.1%