GCC index sees sharp decline on panic selling

MANAMA: Spillover effects and profit-booking drove the second consecutive month of declines at Bahrain Bourse (BHB) during May 2022, a trend that was in line with the rest of the GCC markets.

According to a report by Kuwait-based Kamco, the BHB’s benchmark All-Share index recorded the second-biggest drop in the GCC during the month at 6.6 per cent mainly led by monthly declines in five out of seven sectoral indices.

The decline during May lowered YTD-2022 gains for the aggregate benchmark to single digits at 6.9pc.

The materials sector reported the biggest reversal during the month with a fall of 10.9pc followed by communication services and financials with declines of 7.4pc and 6pc, respectively.

Among gainers, the consumer discretionary index topped with a rise of 3.9pc followed by the consumer staples index that was marginally up by 0.6pc.

In terms of YTD-2022 performance, the materials index topped with a gain of 56pc while the communication services index showed the biggest decline of 12.3pc

The monthly stock performance chart was topped by Bahrain National Holding (BNH) delivering 9.5pc monthly return followed by Bahrain Duty Free Complex and Gulf Hotel Group with advances of 4.9pc and 3.1pc, respectively.

Meanwhile, the monthly decliners’ list mainly included stocks from the banking sector, comprising AUB (down 9.9pc), Al Salam Bank Bahrain (down 9.4pc) and Al Baraka Banking Group (down 8.2pc).

That said, the list was topped by Alba that slumped 10.9pc during May.

The monthly decline came after Alba reported a revenue decline of around 5pc during Q1-2022 and reported below expected net profits during the quarter.

Trading activity on the exchange increased marginally last month as compared to the previous month.

Total volume of shares traded at BHB slipped 0.7pc to 73.3 million shares in May 2022 from 73.8m during April 2022.

Last month also saw total value traded on the exchange plunging sharply by 40.2pc to BD24.3m when compared with BD40.7m during the previous month.

GFH Financial Group topped the monthly volumes traded chart recording 22.3m shares which changed hands during the month followed by Al Salam Bank Bahrain and Ahli United Bank which saw 7.2m and 4m of their shares being traded during the month, respectively.

On the monthly value traded chart, GFH Financial Group also topped this list with BD7m worth of shares changing hands during the month, followed by Ahli

United Bank and Alba, which saw BD3.7m and BD3.6m in value of shares traded, respectively.

Meanwhile, the GCC aggregate index declined for the first time in six months by 7.5pc led by spillover effects from global peers that have seen declines for three out of the first five months this year.

The decline in the GCC also came as investors booked profits on elevated valuations as markets in the GCC were some of the best performing this year.

All the markets in the GCC reported declines during May 2022 with Dubai witnessing the biggest drop of 10pc.

Slippage during the second and third week of the month of almost 11pc was partially offset by gains during the last week.

Nevertheless, the GCC aggregate index remained in the green zone in terms of YTD2022 performance at 12pc with gains for all the seven benchmarks.

The sector performance chart for the month showed that the declines during the month was led by heavyweight sectors in the GCC.

Only the GCC F&B index showed noticeable gains during May 2022 at 2.7pc and the energy index was marginally up by 0.9pc, while the rest of the sectoral indices reported declines.

The telecom index reported the steepest decline of 10.6pc followed by materials and pharma indices with declines of 8.6pc and 8.3pc, respectively.

However, in terms of YTD-2022, energy and banks still feature in the top five performing indices with double-digit gains of 22.8pc and 17pc, respectively.

Source: https://www.gdnonline.com/Details/1103879