March Seasonality

Historically, March has been good month for GCC stock markets.  However, that was also the case for February but last month definitely didn't conform to historical tendencies.

The chart below shows the average daily percentage change for each GCC market during each calendar month.

As you can see, the average daily percentage change during March has been positive for all markets except Bahrain.  However, with the continuing political and social unrest in the region I wouldn't place too much weight in seasonal effects at the moment.

Enjoy.

P.S.  It should be noted that we're dealing with a very small data set for this analysis.  My data only goes back as far as 2004 for GCC equity markets so there have only been seven prior instances of each calendar month. It's hard to draw any concrete conclusions from such a small data set.

February Seasonality

How have GCC stock markets performed during previous February's?

The chart below shows the average daily percentage change for each GCC market during each calendar month.

As you can see, February has tended to be a good month for GCC stocks with all markets showing a positive average daily return.  In fact, from a historical perspective, February through April has been the strongest part of the year for GCC markets.  

Here's hoping this February confirms to historical tendencies.

Enjoy.

P.S.  It should be noted that we're dealing with a very small data set for this analysis.  My data only goes back as far as 2004 for GCC equity markets so there have only been seven prior instances of each calendar month. It's hard to draw any concrete conclusions from such a small data set.

January Seasonality

How have GCC stock markets performed during previous January's?

The chart below shows the average daily percentage change for each GCC market during each calendar month.

As you can see, for most GCC markets January has been slightly bearish in previous years. 

[ Click to enlarge ]

Enjoy.

December Seasonality

October and November, historically the weakest two months of the year for GCC equity markets, are now behind us.  October managed to buck the seasonal headwinds with all markets apart from Saudi rising in value. November, however, conformed to historical tendencies with most markets falling in value.

Going into December there doesn't appear to be any prominent seasonal tendencies.  Apart from the Qatar market that is.  As can be seen in the chart below, the average daily change for the QE Index in December is nearly 0.40%.  That's the largest historical average daily return of any market for any month.

[ Click to enlarge ]

In fact, as the chart below shows, if you had only invested in the Qatar market during the month of December from 2004 to 2009 and sat out the other eleven months of the year, you would have made a cumulative return of 47%.  That's pretty good given that a buy and hold strategy would have  returned just 29% over the same time period.

So, the historical tendency for the Qatar market to rise in value during December has been pretty strong.  However, a word of caution.  We're dealing with a very small data sample when it comes to testing seasonality (my data goes back to the beginning of 2004).  So, these results should be taken with more than a pinch of salt.

That said, with the Qatar market displaying such strong performance over the last six months, plus the recent 2022 World Cup announcement, it'll be interesting to see if the bullish December tendencies materialise this year. 

Enjoy.

November Seasonality

In last month's seasonality post I noted that October and November had historically been the weakest performing months of the year for GCC equity markets.  Well, the markets managed to overcome those negative tendencies in October with all GCC indices apart from Saudi rising in value over the month.

Now we head into November, historically the weakest month of the year (see chart below).  Will the markets manage to overcome the odds again and continue their recent strong performance? Well, November hasn't started off that great but there's still a long way to go.

Enjoy.

October Seasonality: Market Headwinds

After the across the board market gains in September what can we look forward to in October?  Well, based on hisrotical market performance the next couple of months have tended to be the weakest of the year.

The chart below shows the average daily perentage change for each GCC market during each calendar month.  As you can see, October and November are the worst performing months of the year.

After September's strong gains it will be interesting to see if the markets can overcome this seasonal tendency.

Enjoy.

Enjoy.

September Seasonality

September's just around the corner so I thought I'd analyse the historical performance of the GCC markets during this month.

For international equity markets September has been the weakest month of the year.  On average, since 1950, the S&P 500 Index has lost about 1% during September.  I wanted to see if this effect was the same for the GCC equity markets.

The chart below shows the average daily percentage change for each GCC market during each calendar month.

There are a couple of things of note.  Firstly, aside from January, the first half of the year is typically the best period for GCC equity markets.  The strongest months are February, March, April and August.

Secondly, the worst performing months, by some distance, are October and November. That's a big tendency to overcome for anyone who's advocating a year end rally.

As far as September is concerned, however, there isn't much to note apart from the strong performance of the Dubai market during this month.  On the whole, though, September has tended to be a mixed month for GCC equities.  The good news is that the data above doesn't seem to correspond with how international equity markets tend to perform during this month. Phew!

Enjoy.

P.S. As with the previous Ramadan Effect post I have to point out that we're dealing with a very small data set for this analysis.  My data only goes back as far as 2004 for GCC equity markets so there have only been six or seven prior instances of each calendar month. It's hard to draw any concrete conclusions from such a small data set.