Executive Summary
GCC markets (S&P GCC Composite) were flat for the month and the year, with the Real Estate sector standing out as an outperformer, driven by strong sales and rising property prices in UAE and Saudi Arabia. Saudi Arabia’s equity market performance in the past five years has largely been driven by P/E expansion, as opposed to the UAE markets where earnings growth was the primary driver, making the latter more insulated to market downturns. Global markets continued their bull run in the hope that the FED’s assessment of inflation is correct, and a soft landing will be achieved. Going by history, FED has been wrong before and just a small economic shock could topple the markets. Gold marches ahead with further gains, supported by its accumulation by emerging market Central Banks. Despite strong gains, the yellow metal’s run up is nowhere close to what was witnessed in U.S. Tech stocks, indicating further headroom for gains.
