World Economy

Global Stocks Rally

Global Stocks RallyGlobal Stocks Rally

Global stocks rallied after companies from Caterpillar Inc. to Yahoo! posted better-than-estimated earnings and government data signaled a strengthening economy. Fewer Americans filed applications for unemployment benefits over the past month than at any time in 14 years.

Data in the euro area showed manufacturing unexpectedly revived in October, and a gauge of Chinese factory activity rose, exceeding analysts’ estimates.

The Standard & Poor’s 500 Index (SPX) rose 4.1 percent, the best gain since January 2013, halting a four-week slide. Stoxx Europe 600 climbed 2.7 percent for its best performance since December.

“The markets here are drawing strength from a positive close in the US and other international markets,” Hisham Khairy, the Dubai-based head of institutional trade at Mena Corp. Financial Services LLC, said Sunday.

Dubai shares advanced to the highest in almost two weeks after better-than-expected government data in the US and the euro area spurred a global equity rally. Saudi Arabia’s main measure increased, Bloomberg reported.

The Dubai Financial Market General Index (DFMGI) added 2.5 percent to 4,689.12 at the close, the highest since Oct. 13. Arabtec Holding Co., the biggest publicly-traded construction company in the UAE, led gains with a 5.3 percent increase.

Emaar Properties PJSC (EMAAR), the developer of the world’s tallest tower in Dubai, climbed 1.9 percent. Saudi Arabia’s Tadawul All Share Index advanced 1.5 percent.

In Saudi Arabia, Saudi Basic Industries Corp. (SABIC) dropped 0.6 percent to 114.69 riyals after missing analysts’ estimates with a 4.5 percent decline in third-quarter profit. The world’s biggest petrochemicals maker said sales had slowed.

Net income fell to 6.18 billion riyals ($1.65 billion) from 6.47 billion riyals a year earlier, the Riyadh-based company said in a statement to the Saudi Stock Exchange. The mean estimate of eight analysts was for a profit of 6.61 billion riyals, according to data compiled by Bloomberg.

“Price moves are functions of results and that’s why you are seeing petrochemicals stocks underperforming,” Yazan Abdeen, the lead MENA fund manager at Jeddah-based Sedco Capital, said in e-mailed comments.

Sahara Petrochemical Co. dropped 4.1 percent to 21.38 riyals. Its third-quarter profit tumbled to 17.1 million riyals from 148.4 million riyals a year ago, after a decline in production and sales due to plant shutdowns, the company said.

Savola Group (SAVOLA) rose 4.1 percent to 88.25 riyals after its third-quarter profit climbed 53 percent to 701.4 million riyals. The board approved a dividend of 0.75 riyals per share, the company said in a statement after trading closed on Oct. 23. Profit beat the mean estimate of five analysts for 604 million riyals, Bloomberg data show.

Abu Dhabi’s ADX General Index (ADSMI) climbed 0.8 percent and Qatar’s QE Index rose 0.6 percent. Kuwait’s SE Price Index fell 0.4 percent and Egypt’s EGX 30 Index slid 0.3 percent. The TA-25 Index increased 0.2 percent at 2:38 p.m. in Tel Aviv, headed for the highest close since Oct. 7.