DP World stocks surge after Iran nuclear deal reached
DP World, which trades on the NASDAQ Dubai exchange, surged 6.5% to Wednesday to close at US $23.65 on expectations that the lifting of US and EU sanctions on Iran will significantly benefit the company.
DP World’s domination of Middle East markets came on a generally favourable tide that saw Gulf stock markets edged up across the board, supported by rebounding oil prices and second-quarter earnings.
The oil price has been steadied by the announcement from the P5+1 group of western nations (United States, United Kingdom, Germany, France, Russia and China) that sanctions on Iran’s oil industry will not be lifted immediately.
Dubai's index added 0.9% as DP World saw its dramatic gains. As the Middle East’s leading logistics firm, DP World arguably stands to benefit the most from the eventual lifting of sanctions against Iran.
JP Morgan this week raised its target price for the stock to US $25.80 from US $19.40 and upgraded it to "overweight" from "neutral", based on an improved revenue outlook.
Nomura on Wednesday resumed coverage of DP World with a "buy" rating.
Petrochemicals giant Industries Qatar, whose profits are sensitive to oil prices, edged up 0.4%.