Foreign investors, including institutional and retail investors, were net buyers on GCC stock markets during Q3-2024 with net buying at $3.71 billion as compared to $3.66 billion in net buying during Q2-2024.

The trend remained positive from the start of the year with consecutive buying by foreign investors during the 9M-2024 of the year, said Kamco Invest, a Kuwait-headquartered non-banking powerhouse. The biggest buying was seen in Abu Dhabi with total net buying of $1.9 billion followed by Saudi Arabia also seeing consecutive buying by foreigners that reached $1.3 billion in Q3-2024.

Boursa Kuwait was next with the exchange also witnessing consecutive buying by foreigners during the three months of the quarter aggregating to $220.4 million followed by Dubai, Qatar and Bahrain exchanges with net buy transactions of $68.6 million, $68.3 million and $46.3 million, respectively.

Net buying in Bahrain

The net buying seen in Bahrain during Q3-2024 was the highest level recorded in 21 quarters. Data for Oman showed a marginal net buying at $0.3 million for Q3-2024.

Meanwhile, the monthly trend for Saudi Arabia showed that the quarter started with net sell transactions by foreign investors during July-2024 followed by net buy trades during the remaining two months, more than offsetting the net sell trades during July-2024.

Similarly, Qatar experienced net sales by foreign investors in Aug-2024 that was offset by buying during the remaining two months.

Some of the key factors that affected the flow of foreign money in the region included regional market trends, IPOs, geopolitical issues, economic health of the individual countries and crude oil prices. The quarter saw an uptrend in the equity market and skewed towards gainers as two out of seven exchanges reported declines during Q3-2024.

Local investors turn sellers

The anticipated reduction in interest rate by the US Fed during the quarter supported market performance in the region. As a result, local investors were net sellers during the quarter and these shares were grabbed by foreign investors resulting in a broad-based net buy trades by the latter.

In terms of m-o-m performance, net buying value by foreign investors during the quarter peaked during Sep-2024 with aggregate monthly net buying at $2.6 billion. July-2024 witnessed a decline with net buying at $307.1 million while Aug-2024 registered the net buying at $718.9 million.

Historical trend for trading by foreigners in GCC listed stocks showed declines merely in two quarter over the last five years. Foreigners bought the most stocks during Q1-2022 with net buy transactions of $11.0 billion, reflecting steep increase in buying mainly in Saudi Arabia and Qatar.

In terms of the aggregate trading activity, total GCC volume traded increased by 19.8% q-o-q to reach 83.01 billion shares in Q3-2024 as compared to 69.3 billion shares in Q2-2024. All the GCC Exchanges reported a q-o-q increase in volume during the quarter barring Qatar and Oman. Kuwait topped the list with a gain of 32.7% to record 16.8 billion in Q3-2024 compared to 12.7 billion in Q2-2024, followed by Saudi Arabia with 28.1% to record 22.3 billion in Q3-2024 vs. 17.4 billion in Q2-2024. On the other hand, Qatar and Oman declined by 1.6% and 8.9% billion in Q3-2024, respectively.

Value of shares traded

Similarly, the total value of shares traded during Q3-2024 also reported a gain that was largely broad-based. Value traded in Qatar declined while the rest of the markets gained during Q3-2024. Aggregate value traded reached $165.9 billion in Q3-2024 vs. $158.0 billion in Q2-2024. Abu Dhabi reported the biggest increase in trading activity with value traded increasing from $16.0 billion in Q2-2024 to $21.4 billion in Q3-2024 resulting in a share of 12.9% vs. 10.1% in Q2-2024. Trading activity on the Qatar Exchange declined q-o-q from $7.7 billion in Q2-2024 to $6.5 billion in Q3-2024.

Top 10 GCC stocks by trading value

Nine Saudi-based stocks ranked among the top 10 most traded GCC stocks by trading value in Q3-2024. Aggregate traded value of the top 10 listed stocks in the GCC stood at $39.4 billion, accounting for 23.7% of the total value traded on the GCC exchanges during the Q3-2024. Saudi Arabian Oil Co (Aramco) topped the list by recording $7.2 billion in trades followed by Al Rajhi Bank at $6.0 billion. International Holding Co. was the only non-Saudi stock in the list with a quarterly traded value coming in at $4.9 billion during Q3-2024.

GCC value traded - key sector contribution

The banking sector accounted for the biggest share of value traded with an increase of 18.8% to reach $30.9 billion in Q3-2024 from $26.0 billion in Q3-2023.

In the banking sector, Al-Rajhi Bank topped with $6.0 billion worth of traded shares during the quarter followed by the Saudi National Bank and Alinma Bank at $3.2 billion and $3.0 billion worth of traded shares, respectively.

Food, Beverage & Tobacco, Real Estate, and Energy sectors also contributed to total value growth during the quarter. It is noteworthy that out of the ten sectors, eight have witnessed a y-o-y increase in value traded during Q3-2024 while the remaining two sectors witnessed declines. Among the decliners, Material and Other sectors declined by 5.8% and 10.3% respectively.

Similarly, in terms of 9M-2024 performance, the total value of shares traded during 9M-2024 also increased and was largely broad based. All the sectors reported a gain in total value traded during 9M-2024. Aggregate value reached $514.3 billion during the 9M-2024 vs. $382.6 billion in 9M-2023 up by 34.4%. Rest of the sectors showed an increase in trading activity with value trading increasing from $91.1 billion in 9M-2023 to $122.1 billion in 9M-2024. Trading activity in the F&B, Banking and Consumer services sectors increased by 69.8%, 23.9% and 59.8% respectively.-

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