Gulf stocks gain as stimulus hopes offset virus

Major stock markets in the Gulf opened higher on Tuesday, extending gains from the previous session, on hopes that central banks are likely to enact financial stimulus to offset the impact of the coronavirus outbreak.

G7 finance ministers and central bank governors will hold a conference call on Tuesday morning to discuss measures to deal with the widening coronavirus outbreak and its economic impact, a U.S. Treasury spokeswoman said on Monday.

The European Central Bank on Monday joined the chorus of central banks signalling a readiness to deal with the growing threats from the outbreak.

Saudi Arabia’s benchmark index gained 2.2%. Al Rajhi Bank increased 2.5% and petrochemical maker Saudi Basic Industries traded 3% up.

The kingdom had said on Sunday it had prepared 25 hospitals to handle any coronavirus cases that might be detected in the country, part of precautionary measures which include closing its borders to foreign “umrah” pilgrims.

Saudi Arabia on Monday announced its first case of the new coronavirus, a Saudi national returning from Iran through Bahrain, Reuters reported citing the Health Ministry.

Qatar’s index advanced 1.8%, as all stocks on the index traded higher including Qatar National Bank, which climbed 3%.

Other gainers included Qatar International Islamic Bank , which jumped 4.3%.

In Dubai, the index rose 0.7% with Dubai Islamic Bank, the United Arab Emirates’ largest sharia-compliant lender, gaining 1.7% and Emaar Properties was up 1.5%.

The Abu Dhabi index added 1.8%, led by a 2.1% increase in top lender First Abu Dhabi Bank and a 2% gain in Emirates Telecommunications.

The central bank of the United Arab Emirates on Saturday advised banks to reschedule loans and reduce fees and commissions as part of measures to mitigate the economic effects of the coronavirus outbreak.