The latest GCC Fund Market Insight Report from Lipper, published today (Sunday, 23rd August 2009), has revealed that equity funds registered for sale in GCC markets moved into positive territory for the first half of 2009 (YTD 30th June) recording an increase of 21.14%.
Compared with the 12.55% loss in the corresponding period in 2008, almost all Lipper equity categories finished H1 2009 in positive fashion, with emerging markets such as Russia, Indonesia and utility funds gaining 70.77%, 60.16% and 58.97% respectively. In contrast, funds invested in Germany weighted-down overall performance – decreasing 2.32%.
Rebounding strongly in line with improving market conditions, bond funds were up 10.39% over the second quarter and registered a 6.70% rise year to date, which compared favourably with the first quarter of 2009, which witnessed a negative performance of 3.37%.
GCC-domiciled funds revealed similar results, with funds invested in emerging markets and sector-based funds, such as information technology and natural resources, leading the way.
Islamic funds registered for sale in the GCC underperformed their conventional peers during the first half of 2009, gaining only 4.68% some 11.35% behind conventional funds, which returned 16.03%. Equity was the best performing asset class gaining almost 10% due mainly to the robust results from Emerging Markets Global and Emerging Markets Asia, which both increased by over 40%. Real estate funds and money market funds both lost 6.62% and 1.69% respectively, while Kuwaiti money market funds suffered an average 11.11% decline mainly due to the depreciation of the Kuwaiti Dinar against the US Dollar.
The five Lipper Islamic Indices confirmed these trends, with the Islamic Equity Funds Index headlining with an improved return of 11.40% to the end of the first half.
Dunny Moonesawmy, Lipper’s Head of Research for the Middle East, commented: “GCC markets outperformed developed markets but underperformed other emerging markets. News at corporate level (the disclosures of payment defaults by Saad Group and Ahmad Hamad Algosaibi & Bros) and at macro-economic level (confirmation of a lighter GCC monetary council) contributed to accrued uncertainties in the market. However, the market should stabilise itself with the acceleration of government spending programmes which should benefit the whole region.”
