Tadawul surges to 3-week high

A sharp rise in oil prices boosted demand in Saudi Arabia's petrochemical stocks pushing the index to a three-week high, while Gulf bourses were buoyed on hopes that the euro zone crisis was nearing resolution.Oil prices rose on Monday, with Brent crude futures near $111, extending gains from last week on after jitters on supply risks from Iran."Rebounding petchem prices and a noticeably less risk-averse local investor base this morning all contributed to push petchems higher today," said a Riyadh-based trader.The benchmark Tadawul All-Share Index (TASI) rose 1 percent to 6,228.16 — its highest close since Nov. 14. Heavyweight Saudi Basic Industries Corp. (SABIC) gained 3.2 percent, Yanbu National Petrochemical climbed 4.2 percent and National Industrialization rose 1.8 percent."Overall, valuations are pretty attractive right now," said Muhammad Faisal Potrik, petrochemical analyst at Riyad Capital. "It's just a sentiment weakness that's been keeping petchems low."Yamamah Cement jumped 6.4 percent after saying its board has proposed a 50 percent capital increase through bonus shares. In a bourse statement, it said capital would increase to 2 million riyals from 1.3 million riyals. In Qatar, investors are betting on MSCI upgrading the country to emerging market status, which could potentially bring in fresh funds from foreign investors. MSCI will announce the results of its review on Qatar, plus the United Arab Emirates, on Dec. 14.Qatar rose 0.3 percent to 8,781 points — an eight-month high, its highest close since April 4. "The activity in Qatar would indicate the market will remain well-bid," said Ibrahim Masood, senior investment officer at Mashreq bank. "Every position right now is basically for MSCI action — it's all been leading up to this." Banks were the biggest support, with Qatar National Bank up 0.7 percent, Masraf Al-Rayan rising 1.3 percent and Qatar Islamic Bank gaining 1.2 percent.In Oman, the index gained 0.5 percent to 5,536 points — a three-week high. It has a major support level at 5,400 points.Local pension funds bought into blue chips, while foreign institutions targeted telecoms stocks, analysts said.   Oman Telecommunication (Omantel) added 1.1 percent and Nawras climbed 1.6 percent.Meanwhile, UAE markets ended lower as investors booked profit on recent gains. Dubai's index ended 0.4 percent lower at 1,399 points, halting a four-session advance.Bellwether Emaar Properties slipped 1.4 percent from Sunday's three-month high. It rose 15 percent in the preceding four trading days.  "It is a normal corrective wave," said Talal Touqan, head of equity research at Al-Ramz Securities. "It is a healthy sign as long as the drop doesn't take the index back to lower than the previous low."The DFM index may test 1,385 and probably 1,375," he added.Abu Dhabi's benchmark ended 0.1 percent lower, slipping from Sunday's two-week high.