Bank stocks were among main gainers in the Oman rally, with Bank Muscat and National Bank of Oman surging 9.03% and 5.48%, respectively.
“There may be some of the pension funds trying to build some positions. They always liquidate their positions at the end of the year, and build them at the beginning of the year,” said Hassan Tawfiq, senior broker at United Securities in Muscat.
Banks, along with petrochemical firms, were also the top gainers on the Saudi index (Tasi, which climbed 0.5% on anticipated strong quarterly results and a rise in the oil price.
But in Kuwait, the first trading day of the year saw the index decline more than 2% on economic worries and lack of clarity on a government fund designed to help the bourse, which lost more than a third of its value in 2008.
“Until today, we haven’t got a clear statement on the plan of this fund … this lack of visibility is affecting sentiment,” said Rami Sidani, head of investment for the Middle East and North Africa at Schroders.
In November, Kuwait asked its sovereign wealth fund KIA to set up a fund to shore up its ailing bourse. The fund began operations 10 days ago.
National Bank of Kuwait and Kuwait Finance House plummeted 8.47% and 5.88% respectively.
Kuwait’s economy is going through tough times because of the global financial crisis, Sidani said, with Gulf Arab state’s banks hit the hardest.
Bourses in the United Arab Emirates were shut following the death of the ruler of the emirate of Umm Al Quwain. Trading will resume today.
The benchmark rose 4.91% to 5,708 points. Galfar Engineering Co rose 9.94%.
The Tasi closed 0.5% higher at 5,048 points.
“The oil price and fourth quarter results are the main drivers of the market,” said Abdullah al-Aqeel, equity trader at Samba Financial Group.
The Kuwaiti benchmark lost 2.21% to 7,610 points. Mobile Telecommunications Co (Zain), Kuwait’s largest company by market capitalisation, plummeted 5.95%.
The Qatar benchmark (QSI) ended 0.72% higher at 6,935 points. Industries Qatar rose 0.89%, while Qatar Islamic Bank added 1.33%.
Bahrain’s benchmark shed 0.69%, closing at 1,791 points.