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 kingdomâ€™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 worldâ€™s largest oil company is â€œuniquely positionedâ€ 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 â€œgiven Aramcoâ€™s stellar FCF generation,â€ 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 itâ€™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%