DUBAI, June 3 (Reuters) - Saudi Arabia’s stock market rose in early trade on Sunday after businessman Ahmed bin Suleiman al-Rajhi was named minister of labour at the weekend, while Abu Dhabi National Energy (TAQA) dragged down that market.
The Saudi stock index was 1.4 percent higher at 8,275 points after 45 minutes of trade, nearing technical resistance on April’s multi-year peak of 8,345 points.
Al Rajhi Bank surged 3.0 percent; the new minister is a son of the founder of the bank. Other banks were strong in sympathy.
Many Saudi businessmen have been deeply frustrated by labour policy, including measures which make it harder and more expensive to hire foreign workers, and an inefficient, time-consuming system of obtaining employment visas.
Although it is not clear whether any steps to curb hiring of foreign workers will be relaxed, businessmen now hope for policy to be implemented more sympathetically, and for bureaucracy to be made more efficient.
Last year, sources told Reuters that Rajhi was among a delegation of 10 businessmen who met Crown Prince Mohammed bin Salman to discuss how the private sector had been hit by austerity measures and rising fees for employing foreigners.
In Abu Dhabi, the index sank 0.7 percent as TAQA plunged 9.6 percent in thin trade. The stock has been volatile after soaring earlier this year on the back of rising oil prices.
Dubai’s index added 0.3 percent as Emaar properties gained 1.0 percent. A monthly Reuters poll of leading Middle East fund managers, published on Thursday, found sentiment shifting in favour of United Arab Emirates equities after their poor performance so far this year.
Fifty-four percent of managers now expect to raise their allocations to UAE equities in the next three months and none plan to reduce allocations, the most positive balance since January 2017. The managers cited valuations, which have become cheap compared to booming markets such as Riyadh.
In Qatar, the index rose 0.4 percent as Qatar Gas Transport jumped 7.8 percent. It has swung wildly in the past two days as MSCI’s downgrade of the stock to its small-cap index took effect at the end of May; Sunday’s surge suggested selling related to the downgrade had largely finished. (Reporting by Andrew Torchia, editing by Larry King)