SHARES UP: Egypt's stock exchange is the best performer in the MENA region in 2009 so far. (Getty Images)

Equity markets in the MENA region gained, on average, more than 12 percent in value in May, a report by Dubai investment bank Rasmala has shown.

Last month's gains took the total gains in 2009 to date to nearly 15 percent with Qatar the best-performing market in the region in May, and Egypt overtaking Saudi Arabia as the best-performing Arab market in 2009.

Higher oil prices, improved investor sentiment and positive corporate announcements were the main drivers of the positive performance across the markets, the report said.

The UAE equity market continued its recovery and gained a further 11 percent over the month amid increased foreign investor interest in the market.

Real-estate stocks were the main gainers in May, led by Emaar, which gained 48 percent, said Rasmala.

On the other hand, index heavyweights Etisalat and Taqa witnessed zero appreciation in their share price for the month.

Rasmala said the UAE market was "trading at a discount relative to its GCC peers" and analysts saw "room for further market appreciation" on the back of improved investor sentiment and increasing foreign fund flows into the market.

Saudi Arabia, the largest MENA equity market ended the month with a gain of 4.8 percent, taking its 2009 gains to 22.7 percent.

In Kuwait, the market gained 7.9 percent in May, as Agility, the Middle East's largest logistics company, gained 33 percent this month after the company renewed a contract worth $1.4 billion with the US army.

Qatar equities surged in May by 24.6 percent, driven by higher oil prices and the government's offer to buy local banks' real estate investments, Rasmala added.

Oman equities advanced 7.2 percent in May, largely driven by Bank Muscat which gained 7.5 percent during the month.

Higher oil production by non-OPEC oil exporter, along with rising oil prices, are expected to help narrow the country's expected budget deficit in 2009.

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