Saudi, Egypt continue pull-back, UAE down
MIDEAST STOCK MARKETS
Stock markets in Saudi Arabia and Egypt continued pulling back yesterday after big rallies earlier this month, while some individual stocks in the United Arab Emirates and Qatar moved sharply after MSCI adjusted its indexes.
The Saudi index, which had jumped 22 percent between mid-October and Sunday before profit-taking began on Monday, dropped 2.1 percent to 6,493 points yesterday in heavy trade, pulling back from technical resistance on the July peak of 6,703 points. However, the index ended well off the day’s low of 6,346 points. Among major losers, National Commercial Bank, the biggest lender, dropped 4.5 percent. Petrochemicals held up relatively well.
A Saudi fund manager said the market had been supported by local and government funds and when these stopped buying yesterday, profit-taking pressure quickly pushed stocks down.
Some investors had been hoping that international index compiler MSCI would announce, along with its index revisions, that it was starting the process of upgrading Saudi Arabia to emerging market status, two fund managers said. There was disappointment when this did not happen.
Riyad REIT, which jumped its 10 percent daily limit when it listed on Sunday and did so again on Monday, rose a further 3.7 percent, but heavy trading volume showed some investors were keen to take profits. Egypt’s blue chip index dropped 0.5 percent, though it remains up more than 25 percent on hopes for inflows of foreign funds since the central bank floated the Egyptian pound on Nov. 3. Trading volume remained very heavy.
Nine of the most heavily traded stocks rose and some financial stocks continued to surge, such as investment bank EFG Hermes which added 4.2 percent. The index was mostly pulled back by a 1.5 percent decline in the biggest lender, Commercial International Bank, down 1.5 percent, and a 1.7 percent loss by Global Telecom. Exchange data showed foreign investors remaining net buyers of stocks, as they have been since the currency float, though the net amount yesterday was small, only about $5 million. — Reuters