Saudi shares hit by Q3 earnings, region weak
Saudi Arabia’s stock market fell yesterday after another set of disappointing third-quarter earnings, while other markets in the region were also weak, in line with the global trend. The Saudi index slipped 1.2 percent as Alinma Bank, the most heavily traded stock, dropped 2.9 percent.
Alinma was the latest in a string of Saudi banks to report weak quarterly earnings as the slow economy increases impairment charges on loans; it posted a 16.8 percent fall in third-quarter net profit to 312 million riyals ($83.2 million). Analysts had on average forecast 409.1 million riyals.
Medical insurer BUPA Arabia, which had dropped 4.7 percent on Sunday after posting an 8.9 percent drop in its third-quarter net income, fell a further 2.9 percent. Najran Cement lost 3.1 percent after reporting a 52 percent year-on-year drop in thirdquarter net profit. Petrochemicals generally outperformed, with top producer Saudi Basic Industries, which is expected to report quarterly earnings in the next few days, dropping only 0.6 percent.
Saudi Company for Hardware was one of the few gainers, rising 2.3 percent after reporting a 10.1 percent rise in quarterly net profit. Dubai’s stock index fell 0.9 percent in a broad-based decline, although the two most heavily traded stocks, GFH Financial and builder Drake & Scull , rose 3.9 percent and 1.1 percent. Abu Dhabi’s index sank 2.2 percent because of a steep decline by First Gulf Bank, which lost 4.9 percent. The only Gulf market to gain was Qatar, which rose 0.6 percent on the back of Qatar National Bank’s 1.5 percent gain. The bank reported a 10 percent rise in third-quarter profit last week.
Egypt’s index lost 2.2 percent as investment bank EFG Hermes pulled back 2.9 percent. Shares in Beltone Financial were briefly suspended and then resumed trading after the stock’s fair value was misstated in a report given to the financial regulator on Sunday. They last traded at 10.71 pounds, level with Sunday’s close.
The stock has been dogged by controversy. In August, Egypt’s regulator requested that Beltone appoint a third party to assess the fair market value of its stock after it jumped more than 550 percent. In June, Beltone filed a lawsuit against the heads of the Cairo stock exchange and the financial regulator over the repeated cancellation of trades in its stock.