RIYADH: Gulf equities staged their sharpest rally in almost two years in September, lifted by synchronized central bank rate cuts and Ƶ’s signal of deeper market access.
According to Kamco Invest’s monthly report, the MSCI GCC index advanced 4.9 percent, its biggest monthly gain in 21 months, closing near a three-year high.
Ƶ led with a 7.5 percent jump for the Tadawul All Share Index, while Kuwait, Oman and Bahrain also finished higher; Dubai posted the largest decline among regional peers, down 3.7 percent, with Qatar and Abu Dhabi also ending lower.
This comes as the US Federal Reserve cut rates by 25 basis points, a move mirrored across GCC central banks. Sentiment further strengthened when Saudi authorities signaled plans to scrap the 49 percent cap on foreign ownership of listed companies, spurring renewed foreign buying — especially in banks.
In its monthly bulletin, Kamco stated: “After reporting losses during the previous two consecutive months, Ƶ’s TASI recorded the biggest monthly gain in the GCC during September-2025 after the index surged 7.5 percent during the month.”
It added: “The Index breached the psychological mark of 11,000 points after trading below this level for almost 10 weeks and closed the month at the highest level since May-2025 at 11,503.0 points.”
On a year-to-date basis, Kuwait’s All-Share Index remained the GCC’s top performer at 19.5 percent, ahead of Oman and Dubai, both up 13.2 percent over the first nine months.
Global risk appetite provided a tailwind as well, with world equities up 3 percent, the Nasdaq up 5.3 percent and the MSCI Emerging Markets index up 6.5 percent.
Saudi leads with broad gains
After two down months, Saudi stocks staged a decisive reversal. Notably, the TASI jumped 5.1 percent on Sept. 24 to 11,437, its biggest one-day gain since 2020.
The performance reflected a confluence of factors: the Capital Market Authority’s plan to lift foreign ownership limits, firmer crude despite an OPEC+ decision to raise October output by 137,000 barrels per day, and a synchronized 25-basis-point rate cut by the Saudi central bank following the Fed. The strong September narrowed the index’s year-to-date decline to 4.4 percent.
The financial services index rose 12.3 percent, while banks and insurance gained 10.7 percent and 10.2 percent.
All listed banks advanced following the ownership announcement; Al Rajhi Bank, Saudi National Bank and Bank Albilad climbed 14 percent, 11.94 percent and 11.87 percent, respectively. Large-cap sectors added support, with energy up 3.8 percent and telecom up 5.8 percent.
The National Shipping Co. of Ƶ surged 24.6 percent and Ades Holding rose 9.9 percent. Media constituents rallied as well, led by MBC Group up 23.3 percent and Arabian Contracting Services up 17.7 percent.
Liquidity improved meaningfully: value traded rose 38.9 percent month on month to SR125.7 billion, while volumes edged up to 5.83 billion shares; Al Rajhi Bank topped the value table, followed by MBC Group and Aramco.
Kuwait out in front
Kuwait extended its lead as the region’s top performer this year, with the All-Share Index rising 3.5 percent in September and 19.5 percent year-to-date.
The Main 50 Index climbed 6.7 percent, the Main Market Index gained 5.2 percent, and the Premier Market Index added 3.1 percent, lifting the All-Share to 8,795.7.
With September’s gains, Kuwait reclaimed the top spot in GCC year-to-date performance, supported by a 25 percent jump in the Main 50.
Healthcare rose 18.3 percent, real estate 6.1 percent and consumer discretionary 5.4 percent; banks added 3.1 percent as seven of nine lenders gained.
Trading strengthened as monthly volumes rose 13.3 percent to 10.7 billion shares and value traded increased 15.3 percent to 2.3 billion Kuwaiti dinars ($7.52 billion).
Mixed picture in the UAE
Abu Dhabi’s FTSE ADX Index edged down 0.8 percent to 10,014.6 but remained above the 10,000 mark for a third month. The year-to-date gain stood at 6.3 percent.
Seven of 10 sectors declined, led by consumer staples down 5.8 percent, industrials down 5 percent and real estate down 2.1 percent. Gains in utilities, telecommunications and energy — up 4.8 percent, 4 percent and 3.3 percent — helped limit the overall decline.
Among notable movers, GFH rose 22.9 percent, Union Insurance 15 percent, and ADNOC Gas 6.3 percent. ADNOC Gas also signed a 10-year LNG supply deal with Hindustan Petroleum for 0.5 million tonnes per year from the Das Island facility.
On the downside, ARAM Group fell 33.2 percent, while ADC Acquisition and Umm Al Qaiwain General Investments also retreated.
Dubai’s DFM General Index declined 3.7 percent to 5,839.6, trimming its 2025 return to 13.2 percent, still one of the strongest in the GCC. Sector performance skewed negative, with six of eight sectors down.
Pressure in heavyweight groups — financials down 2.5 percent and real estate down 8.3 percent — drove the headline move. Large banks contributed to the drag, including Emirates NBD down 3.8 percent and Commercial Bank of Dubai down 2.4 percent.
Trading patterns were mixed: volumes fell to 3.8 billion shares, down 20.9 percent, while turnover rose 9.6 percent to 13.2 billion dirhams ($3.59 billion); Emaar Properties led by value at 5.1 billion dirhams.
Despite equity weakness, Dubai’s property cycle stayed active. Real estate sales value climbed 33.7 percent year on year in the first nine months, with transaction counts also higher; the report points to sustained activity in both off-plan and secondary markets.
That momentum remains a key macro pillar for the emirate even as equities consolidated in September.
Valuations and market cap
At the end of September, Gulf markets showed wide valuation disparities, with Dubai trading at 10.7 times trailing earnings and a 4.8 percent dividend yield, Abu Dhabi at 20.7 times with a 2.3 percent yield, and Ƶ at 19.8 times with a 3.5 percent yield.
Kuwait’s premier market stood at 17.2 times with a 2.3 percent yield, Qatar at 12.3 times with 4.5 percent, Oman at 9.1 times with 5.8 percent and Bahrain at 13.7 times with 9.8 percent.
Aggregate GCC market capitalization was about $4.04 trillion, while monthly value traded rebounded to $54.9 billion from $43.6 billion in August.
Two region-wide charts in the report highlight the inflection, with one showing GCC market capitalization recovering toward the year’s highs in September and the other showing value traded rebounding sharply to $54.9 billion for the month.
Combined with the Saudi liquidity surge, these suggest investors responded to clearer policy signals and improved non-oil momentum.
Smaller markets at a glance
Beyond the big four, the report notes that Qatar’s QE20 ended September down 1.5 percent, with the All Share down 1.4 percent; telecoms and insurance outperformed while transportation and banks lagged, and trading value eased modestly to just over 9.1 billion Qatari riyals ($2.5 billion).
Bahrain’s All Share gained 1 percent as financials and materials offset weakness elsewhere, with a sharp uptick in turnover.
Oman’s MSX 30 rose 3 percent, marking a third monthly advance and touching an eight-year intraday high late in the month.
These moves, while secondary to the region’s main drivers in September, contributed to the GCC’s aggregate market cap recovery and were consistent with broader risk-on sentiment.
