Amman- Arab stock markets reacted positively on Thursday to Iran's release of 15 detained British sailors, financial analysts said Friday. They expected further political ramifications of the Iranian step to give a hand to regional markets, which were squeezed over the past months partly as a result of the standoff between Iran and the West over Tehran's nuclear programme.
"The defusing of the British sailors crisis is expected to lessen tension that dominated the Gulf region over the past months and, consequently, to have a positive impact on regional stock markets," Amman-based analyst Wajdi Makhamreh told Deutsche Presse-Agentur dpa.
"However, the volume of liquidity and corporate earnings in the first quarter of the year will remain the driving force of markets," he said.
Almost all Arab bourses open for trading on Thursday rebounded or extended gains, particularly the United Arab Emirates stock markets of Dubai and Abu Dhabi and the Amman Stock Exchange (ASE).
The ASE all-share price index gained 1.18 per cent on Thursday after suffering throughout the week, but on a weekly basis, the benchmark price fell 1.68 per cent, closing at 6,046 points compared with last week's close at 6,149 points.
"Despite the liquidity shortage suffered by the market at present, we believe the rebound will continue for a few days next week before investors resort to profit-taking tactics," Makhamreh said.
Saudi shares suffered for the third week in a row this week, mainly due to plunge of blue chips with the decline led by the banking sector and the Saudi Telecom Co, according to the Riyadh- based Bakheet Financial Advisors (BFA).
The Tadawul All Shares Index (TASI) of the Saudi stock exchange shed 2.8 per cent this week closing at 7,666.62 points, down from 7,889.74 points last week.
TASI, which lost 13 per cent over the past three weeks, is currently 3.4 per cent lower that the year's start.
The BFA weekly report attributed the continued decline of the benchmark price to "lack of vision on the part of a large number of investors" because they feared further declines of stock prices on one hand and for focusing on speculative shares on the other.
The report expected investors to monitor the first quarter results of listed firms before revaluating their portfolios.
The BFA warned that speculative stocks "will remain unpredictable" due to the random trading behaviour of investors involved in this type of activity.
Kuwait's KSE all-share price index gained 0.2 per cent this week, closing at 10,243 points up from last week's close at 10,222 points.
The UAE all-share price index of the Dubai and Abu Dhabi stock exchanges jumped 2.1 per cent on Thursday, apparently affected by the release of the British sailors.
On weekly basis, the UAE benchmark price closed on Thursday at 3,860 points, marginally up from 3,846 points last week.
