DUBAI, June 18 (Reuters) - Low oil prices may dampen most Gulf stock markets on Sunday but positive corporate news in Qatar may help that bourse continue to recover moderately from losses due to the economic sanctions against Doha.
Brent oil futures settled at $47.37 a barrel on Friday - not a disastrous level for the Gulf, but one which means governments may have less room to spend this year than investors hoped just a few weeks ago.
“Oil prices above US$50/bbl are conducive to helping reforms succeed while oil prices below US$40/bbl are likely to endanger macro stability,” Bank of America Merrill Lynch said in a report last week.
Qatar’s stock index rose 0.7 percent on Thursday, gaining for two days straight for the first time since June 5, when Arab states including Saudi Arabia cut diplomatic and trade ties. The index is down 6.7 percent since that date.
There may be room for a further, moderate rebound after state-owned Qatargas said at the weekend it had signed an agreement with Shell for delivery of up to 1.1 million tonnes of liquefied natural gas per year for five years - a sign that Qatar’s core LNG business is operating largely as normal despite the sanctions.
Also, the Qatar exchange said subscriptions to 3.3 million Doha Bank shares, which had been unsubscribed in the bank’s capital increase, had been completed.
In Dubai, Union Properties may attract some interest after the company said it had entered an agreement with Al Ramz Capital to provide liquidity for its shares. Al Ramz is permitted to own up to 5 percent of the company’s shares under the deal. (Reporting by Andrew Torchia)