Oil Prices and Stock Markets: What Drives what in the Gulf Corporation Council Countries?

In the empirical literature, only few studies have focused on the relationship between oil prices and stock markets in net oil-importing countries. In net oil-exporting countries this relationship has not been widely researched. This paper implements the panel-data approach of Kónya (2006), which is based on SUR systems and Wald tests with country-specific bootstrap critical values to study the sensitivity of stock markets to oil prices in GCC (Gulf Corporation Council) countries. Using two different (weekly and monthly) datasets covering respectively the periods from 7 June 2005 to 21 October 2008, and from January 1996 to December 2007, we show strong statistical evidence that the causal relationship is consistently bi-directional for Saudi Arabia. Stock market price changes in the other GCC member countries do not Granger cause oil price changes, whereas oil price shocks Granger cause stock price changes. Therefore, investors in GCC stock markets should look at the changes in oil prices, whereas investors in oil markets should look at changes in the Saudi stock market.GCC stock markets, oil prices

Oil prices and stock markets: what drives what in the Gulf Corporation Council countries?

In the empirical literature, only few studies have focused on the relationship between oil prices and stock markets in net oil-importing countries. In net oil-exporting countries this relationship has not been widely researched. This paper implements the panel-data approach of Kónya (2006), which is based on SUR systems and Wald tests with country-specific bootstrap critical values to study the sensitivity of stock markets to oil prices in GCC (Gulf Corporation Council) countries. Using two different (weekly and monthly) datasets covering respectively the periods from 7 June 2005 to 21 October 2008, and from January 1996 to December 2007, we show strong statistical evidence that the causal relationship is consistently bi-directional for Saudi Arabia. Stock market price changes in the other GCC member countries do not Granger cause oil price changes, whereas oil price shocks Granger cause stock price changes. Therefore, investors in GCC stock markets should look at the changes in oil prices, whereas investors in oil markets should look at changes in the Saudi stock market.http://deepblue.lib.umich.edu/bitstream/2027.42/64354/1/wp960.pd

Oil prices and stock markets: what drives what in the Gulf Corporation Council countries?

In the empirical literature, only few studies have focused on the relationship between oil prices and stock markets in net oil-importing countries. In net oil-exporting countries this relationship has not been widely researched. This paper implements the panel-data approach of Kónya (2006), which is based on SUR systems and Wald tests with country-specific bootstrap critical values to study the sensitivity of stock markets to oil prices in GCC (Gulf Corporation Council) countries. Using two different (weekly and monthly) datasets covering respectively the periods from 7 June 2005 to 21 October 2008, and from January 1996 to December 2007, we show strong statistical evidence that the causal relationship is consistently bi-directional for Saudi Arabia. Stock market price changes in the other GCC member countries do not Granger cause oil price changes, whereas oil price shocks Granger cause stock price changes. Therefore, investors in GCC stock markets should look at the changes in oil prices, whereas investors in oil markets should look at changes in the Saudi stock market.GCC stock markets, oil prices

On the influence of oil prices on stock markets: Evidence from panel analysis in GCC countries.

This paper implements recent bootstrap panel cointegration techniques and Seemingly Unrelated regression (SUR) methods to investigate the existence of a long-run relationship between oil prices and Gulf Corporation Countries (GCC) stock markets. Since GCC countries are major world energy market players, their stock markets are likely to be susceptible to oil price shocks. Using two different (weekly and monthly) datasets covering respectively the periods from 7 June 2005 to 21 October 2008, and from January 1996 to December 2007, our investigation shows that there is evidence for cointegration of oil prices and stock markets in GCC countries, while the SUR results indicate that oil price increases have a positive impact on stock prices, except in Saudi Arabia.http://deepblue.lib.umich.edu/bitstream/2027.42/64426/1/wp961.pd

On the influence of oil prices on stock markets: Evidence from panel analysis in GCC countries.

This paper implements recent bootstrap panel cointegration techniques and Seemingly Unrelated regression (SUR) methods to investigate the existence of a long-run relationship between oil prices and Gulf Corporation Countries (GCC) stock markets. Since GCC countries are major world energy market players, their stock markets are likely to be susceptible to oil price shocks. Using two different (weekly and monthly) datasets covering respectively the periods from 7 June 2005 to 21 October 2008, and from January 1996 to December 2007, our investigation shows that there is evidence for cointegration of oil prices and stock markets in GCC countries, while the SUR results indicate that oil price increases have a positive impact on stock prices, except in Saudi Arabia.GCC stock markets, oil prices, panel cointegration analysis

Analysis of financial performance of the commercial banks in the Gulf Cooperation Council (GCC) countries

Research on performance of banks in the Gulf Cooperation Council (GCC) countries is very limited despite being one of the key global banking markets, main suppliers of oil around the globe, and economies that attract significant foreign direct investment (FDI). Hence, this study provides new insight on bank performance using bank-specific, macroeconomic, and financial structure indicators. Using the generalized method of moments dynamic model estimation, this study analyses the perfom1ance of banks in GCC countries over the period from 2000-2015. This study finds that the perfom1ance of foreign banks is better than that of domestic banks and the performance of listed banks is better than that of unlisted banks. The results show that there is a significant direct impact of oil price shocks, FDI inflows, and financial crisis on bank performance. It also finds that the bank-specific factors, macroeconomic factors and financial structure indicators are significant determinants of bank performance. In terms of theories, the study finds evidence to support the moral hazard theory, competition-stability theory, defensive expansion theory and traditional intem1ediation theory (except Bahraini banks). The results are also robust when controlling for the Arab Spring transition period as well as when using alternative risk and bank competition measures. The results show that Arab Spring increases bank risk. The findings of this study have major policy implications. Gulf authorities need to enhance bank protection against risk by improving the application of Basel III especially during the crisis period like the Arab Spring. Gulf Banks also need to track the changes in oil prices as this also have impact on bank performance. There is a need for some ease of restrictions on the entry of foreign banks in the domestic market in the Gulf countries (except for Bahrain) as it can enhance bank performance

Gulf Cooperation Council (GCC) Women and Misyar Marriage: Evolution and Progress in the Arabian Gulf

Women’s status continues to undergo rapid evolution in the Gulf Co-operation Council (GCC). The modernization policies sweeping the energy-rich region has resulted in unintended social and gender imbalances. Partly due to the wealth distribution policies and the vast influx of foreign labor into the GCC, the region’s indigenous people are facing several challenges as they adapt to their surrounding environment. Improvements to women’s education have resulted in an imbalance of highly educated women relative to their male counterparts in the region, tipping the scales of gender roles. While both men and women accept predominantly paternal values, the strides in women’s status may be contradictory to traditions, customs, and expectations. As a result, high divorce rates plague GCC citizens, while misyar marriage reemerges as a temporary antidote

INVESTMENT FOR TRADE? IMPACT OF INVESTMENT FROM GULF COOPERATION COUNCIL COUNTRIES ON TRADE

The world has made great progress over the centuries through the massive increase in the interconnectedness of nations around the globe. Today, the world is connected through various ways, including the movement of goods, people, and money. The amount of goods traded across countries borders has drastically increased as the result of technological progress and the removal of barriers to trade. Not only has the world become more interconnected with the physical flows of goods and services, but also countries of the world have become more integrated financially. This study proposes to analyze how increase in financial flows, as measured by Foreign Direct Investment, impact physical flows of goods, as measured by trade. The study focuses on Gulf countries. These countries represent an interesting case study given the structure of their economies, their massive natural resource endowments and heavy reliance on oil and natural gas revenue, and their large sovereign funds. Using panel data for the years 2001-2012 and reliable econometric techniques, the study assesses the impacts of increased investment from Gulf countries on the imports from and exports to partner countries. The results show that both FDI inflows and outflows significantly increase imports to and exports from the Gulf countries. The results are robust to various estimations methods and remain valid for both agricultural and non-agricultural products. The findings of the study provide a better understanding of the trade-investment nexus and shed light on the underlying motives of investment by Gulf countries. Inflows and outflows of investment serve as a strategic option for Gulf countries to both promote their exports while securing their supply in consumer and capital goods

On the Influence of Oil Prices on Stock Markets: Evidence from Panel Analysis in GCC Countries

This paper implements recent bootstrap panel cointegration techniques and Seemingly Unrelated regression (SUR) methods to investigate the existence of a long-run relationship between oil prices and Gulf Corporation Countries (GCC) stock markets. Since GCC countries are major world energy market players, their stock markets are likely to be susceptible to oil price shocks. Using two different (weekly and monthly) datasets covering respectively the periods from 7 June 2005 to 21 October 2008, and from January 1996 to December 2007, our investigation shows that there is evidence for cointegration of oil prices and stock markets in GCC countries, while the SUR results indicate that oil price increases have a positive impact on stock prices, except in Saudi Arabia.GCC stock markets, oil prices, panel cointegration analysis

Impact of the real economy on stock market performance: evidence from Arab countries

In this paper, the macroeconomic determinant of stock market performance represented in stock market capitalization in 15 markets in the Arab world are assessed. The analysis is based on panel data techniques from 1995 to 2014. Furthermore, differentiation between Arab countries according to their affiliation to the Gulf Cooperation Council (GCC) and according to their classification as oil vs. non-oil economies is explored, In addition to traditional variables, an institutional variable and remittances are included among the regressors. The results were that domestic credit, GDP, economic freedom and net remittances have negative effect on stock market capitalization. On the other hand, investment, stocks traded and inflation have a positive effect. Upon classifying the sample to oil vs. non-oil economies, domestic credit lost significance, GDP, economic freedom and net remittances have a negative effect in oil economies and a positive effect in non-oil economies. Inflation has a positive effect in oil economies and a negative effect in non-oil ones. Furthermore, classifying the sample to GCC vs. non-GCC countries, GDP has a negative effect on both. Stocks traded and investment have a positive effect on both. Domestic credit, net remittances and inflation have a negative effect in GCC countries and a positive one in non-GCC countries