Gulf sentiment is likely to be supported by further gains in global shares following US jobs data
Gulf sentiment is likely to be supported by further gains in global shares following stronger-than-expected US jobs data, but investors in Saudi Arabia may take lower oil prices as a cue to book recent gains.
Asian shares rallied to a three-month high on Monday as US data and emerging optimism for European action on the debt crisis sharpened investor appetite for risk.
Brent crude fell 31 cents to US$108.63 a barrel by 0509 GMT as a recent surge in prices gave some investors a chance to sell their holdings for profit.
Caution is likely to remain on global markets until concrete policy measures in Europe are taken, which may be weeks away, and investors in the near term will be looking to data out of China starting Thursday - from trade to bank loans and investment - to give the global economic outlook a further lift.
In the kingdom, Saudi telco Etihad Etisalat (Mobily) will also be focus after it awarded IBM a five-year contract worth SAR1.05bn (US$280m) to outsource its information technology operations.
Shares in Mobily edged lower 0.8 percent on Sunday in heavy trade ahead of the announcement.
Saudi Arabia's index slipped 0.1 percent in the previous session, easing away from Saturday's nine-week high.
"Trading activity should slow down this week because traditionally, Ramadan is weak in terms of volumes," says Muhammad Faisal Potrik, research analyst at Riyad Capital. The Muslim month of fasting is in its second half, the end of which will be marked by a holiday. Many investors tend to book their gains ahead of it. "Prices have rallied quite a bit but where the market goes from here will depend on global markets and oil prices."
In the UAE, conglomerate Dubai Investments , is likely to witness selling pressure after it posted a 54 percent decline in second-quarter net profit on Sunday as revenue dropped.
The company, in which sovereign fund Investment Corp of Dubai (ICD) owns 11.5 percent, reported a net profit of AED63.4m(US$17.3m) in the second quarter.
Elsewhere, Qatar Telecom unit Indosat has concluded a sale and leaseback agreement worth US$406m with Tower Bersama Infrastructure (TBIG), the Qatari firm said in a statement on Sunday.
The deal, which covers 2,500 towers, will be financed using cash and newly-issued shares worth 5 percent of TBIG's enlarged share capital, the statement said.