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Sun 25 Mar 2012 11:04 AM

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Gulf cues positive; UAE banks in focus

Saudi Arabia's benchmark broke a resistance level and closed at 7,676 points on Saturday

Gulf cues positive; UAE banks in focus
Saudi Arabias benchmark broke a resistance level and closed at 7,676 points.

Gulf bourses have a positive lead on Sunday as gains in world markets over the weekend support sentiment while shares in Saudi Arabia rallied on Saturday.

Saudi Arabia's benchmark broke a resistance level and closed at 7,676 points on Saturday as large-caps rose.

"The index will show weakness in the coming sessions and will test 7,000 level support. We will be in the range of 7,000 to 7,600 points for a few weeks until the long-term trend is decided," says Mohammad Omran, a Saudi-based financial analyst.

In the UAE, the rate of bank lending growth in the UAE is "reasonable," Central Bank Governor Sultan Nasser al-Suweidi said on Friday.

Shares on banks may see some support. Analysts are expecting banks to post strong earnings numbers for the first-quarter on the back of rise in lending and cash-rich balance sheets.

"We expect the UAE Banks to grow their earnings by 7 percent on average (during the quarter compared to a year earlier)," says Ali Adou Portfolio Manager at The National Investor.

Foreign investor participation will be muted in local exchanges as they are away for the weekend.

Elsewhere, world stocks rebounded on Friday, as concerns about global growth were set aside by investors who saw further gains in this year's rally.

Oil prices rallied on news that Iranian oil exports have fallen significantly this month as tightening Western sanctions have caused some buyers to stop or scale back purchases.

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