Gulf bourses edge up, Egypt’s rally reverses

MIDEAST STOCK MARKETS

Gulf stock markets edged up in quiet trade yesterday, encouraged by strength in emerging markets generally, but Egypt’s index reversed the trend higher it had enjoyed since the float of the Egyptian pound three weeks ago.

The Saudi stock index rose 0.7 percent to 6,844 points, though it stopped short of technical resistance on its April peak of 6,876 points, which it had tested and failed to break on Thursday. Trading volume fell sharply. The petrochemical index underperformed, edging down 0.1 percent, after oil prices fell sharply at the end of last week. Saudi Kayan fell back 1.8 percent. But Alawwal Bank jumped 1.6 percent after changing its name to Alawwal from Saudi Hollandi Bank in a rebranding exercise that coincides with Royal Bank of Scotland seeking a buyer for its 40 percent stake.

Much activity focused on second- and third-tier stocks favoured by local retail speculators, such as Saudi Fisheries , which surged 3.9 percent. In Dubai, the index climbed 0.4 percent on the back of an 11.4 percent leap to 0.93 dirham by Union Properties, the most active stock, in its heaviest trade since June 2015. It rose above this year’s previous high of 0.91 dirham, which had been hit in March.

Abu Dhabi’s index gained 0.6 percent, aided by a 2.0 percent rise in telecommunications blue chip Etisalat. Qatar’s index edged up 0.2 percent on the back of a 2.4 percent surge by Barwa Real Estate. The Egyptian index dropped 1.8 percent to 11,146 points, confirming a bearish engulfing pattern on the daily candlestick chart - a classic technical sign of the reversal of an uptrend.

The pull-back suggested the market’s dramatic bounce in response to the Nov. 3 currency float, which boosted the index by as much as 37 percent to last week’s peak, might now be ending as investors took profits and focused on Egypt’s still-difficult economic environment. — Reuters