Ramadan, the holiest month of the Islamic calendar marked with fasting and prayer, is also an uplifting time for stock markets in predominantly Muslim countries, according to a study by the University of New Hampshire. Stock markets in Egypt, Oman, Turkey, Kuwait, United Arab Emirates, Qatar, Pakistan, Jordan, Morocco, Tunisia, Malaysia, Bahrain, Indonesia and Saudi Arabia generated average returns of 38 per cent during the month of Ramadan over the years 1989 through 2007, according to the report compared with their average 4.3 per cent returns the rest of the year. Ahmad Etebari, a professor of finance at the university in Durham, New Hampshire, who was lead researcher on the study, said he was surprised by the finding. "Fasting is quite an ordeal during those long summer days in the Middle East," said Etebari, who was born in Iran. "I expected to see the opposite." Since Ramadan is determined by a lunar calendar, its starting date varies from year to year. Etebari found that the markets he analyzed performed strongly, regardless of the timing of Ramadan. Etebari concluded that the rally resulted from greater optimism during Ramadan. "This is behavioral," Etebari said. "It stems from psychology." Observance of Ramadan is expected to start on or about Aug. 11 and finish on or about Sept. 10. In the Middle East, Dubai's main index and Abu Dhabi's benchmark are both down so far this year, while stocks in Indonesia .JKSE, an officially secular country that has the world's largest Muslim population, are up about 20 per cent. "The implication of our find for investors is obvious," Etebari said. "Investors seeking fast profits in the Muslim world should try to profit from the fast."
