By Maqsood Alam
Jan 3 (Reuters) – Stock markets in the United Arab Emirates (UAE) closed higher on Sunday, starting 2021 on a positive note on hopes that the rollout of a coronavirus vaccine will lift economic activity, while Saudi Arabian shares fell on uncertainty about the outlook for oil prices this year.
The UAE on Saturday recorded a fourth straight record number of daily coronavirus cases, with 1,963 new infections.
Dubai and Abu Dhabi have begun rolling out COVID-19 vaccines, which (BofA) said in a note are particularly pertinent for the UAE given its exposure to trade and tourism.
“We believe the vaccine provides a realistic chance that the travel & tourism sector (including attendance at the Expo) and trade could rebound more strongly than currently anticipated,” said the statement.
Expo 2020, due to take place in Dubai but delayed due to the pandemic, will now take place from October 2021 to March 2022.
Abu Dhabi’s stock index .ADI rose 0.7%, led by a 1.7% increase in First Abu Dhabi Bank FAB.AD, while telecoms firm Etisalat ETISALAT.AD gained 0.7%.
The Dubai index .DFMGI was up 0.6%, supported by gains in financial and real estate shares. Emirates NBD ENBD.DU rose nearly 2%, while Emaar Properties EMAR.DU was up 1.4%.
The share index in Saudi Arabia .TASI fell 0.9% as most of its constituents closed in negative territory. Al Rajhi Bank 1120.SE led the losers, dropping 1.2%.
Chemical maker Saudi Basic Industries 2010.SE shed 0.8%, while Saudi Aramco 2222.SE was down 0.4%.
Oil prices are unlikely to mount much of a recovery in 2021 as a new coronavirus variant and related travel restrictions threaten already weakened fuel demand, a Reuters poll showed.
According to the poll, Brent crude prices .LCOc1 would average $50.67 per barrel this year.
The Qatari Index .QSI closed flat as Qatar Fuel QFLS.QA gained 1.2% and Commercial Bank COMB.QA shed 1.2%.
A Gulf Cooperation Council (GCC) summit will be held on Jan. 5 to discuss steps towards ending a diplomatic row with Qatar that began in 2017 when Saudi Arabia, the United Arab Emirates and Bahrain severed diplomatic ties with Qatar, accusing it of backing “terrorist” groups. Doha denies the charge and accuses its neighbours of seeking to curtail its sovereignty.
“I see some regional companies from Saudi, UAE and Qatar benefiting if these countries reach a settlement to the issues and remove the blockade,” said Joice Mathew, senior research manager at United Securities.
In Egypt, the index .EGX30 was also flat. Cleopatra Hospital CLHO.CA eased 2.9%, while GB Auto AUTO.CA jumped 6.9%.
The Omani index .MSI ended 0.6% higher. Stock markets in Kuwait and Bahrain were closed.
SAUDI ARABIA
<.TASI lost> 0.9% to 8,613
ABU DHABI
.ADI rose 0.7% to 5,079
DU(BA)I
.DFMGI gained 0.6% to 2,506
QATAR
.QSI was flat at 10,437
EGYPT
.EGX30 flat at 10,845
OMAN
.(BA)X gained 0.6% to 3,679
(Reporting by Maqsood Alam in Bengaluru; Editing by Susan Fenton)
((Maqsood.Alam@thomsonreuters.com;))
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