Mideast bourses join global mar­ket rout

The Pak Banker - - BUSINESS -

Stock mar­kets in the Middle East fell on Tues­day, eras­ing the prior ses­sion's gains, as risk ap­petite di­min­ished fol­low­ing a slump in global shares.

Egypt's main in­dex tum­bled 2.8 per cent to 6,004 points, eras­ing the prior ses­sion's gains as for­eign funds re­deemed shares, bourse data showed.

Com­mer­cial In­ter­na­tional Bank, a stock favoured by in­ter­na­tional fund man­agers, re­treated 3.3 per cent. Palm Hills De­vel­op­ment de­clined 4.3 per cent in heavy trade, af­ter the de­vel­oper posted strong quar­terly earn­ings early this week.

Egypt's cen­tral bank has been striv­ing to main­tain sta­bil­ity in the cur­rency over the past sev­eral months, but for­eign in­vestors are still jit­tery about the pos­si­bil­ity of a de­val­u­a­tion and the neg­a­tive im­pact it would have on their in­vest­ment re­turns and com­pa­nies' earn­ings.

Riyadh's in­dex fell 0.5 per cent to 5,874 points, af­ter briefly trad­ing in pos­i­tive ter­ri­tory, as lo­cal traders cashed out of small and mid-cap stocks, which had helped lift the in­dex 0.2 per cent on Mon­day. "It's a stock picker's mar­ket at this point," said a Jed­dah-based stock bro­ker. "Traders are buy­ing spec­u­la­tive stocks to book a quick profit and ei­ther cash out or ro­tate into the blue chips."

The ma­jor­ity of spec­u­la­tive in­sur­ance stocks re­treated, with Al Sagr Co­op­er­a­tive In­sur­ance slump­ing 4.4 per cent af­ter it had jumped 8.1 per cent the pre­vi­ous day.

Dubai's in­dex dropped one per cent to 3,065 points, but closed 42 points above its intra-day low. Blue-chip stocks were the main drag on the bourse, with Emi­rates NBD, the largest len­der by as­sets, tum­bling 4.5 per cent.

But some small and mid-cap stocks favoured by lo­cal retail in­vestors rose, with Da­mac Prop­er­ties adding 4.8 per cent, af­ter fall­ing by two per cent in early trade. Drake & Scull added 1.2 per cent.

In Abu Dhabi, the bench­mark also fell one per cent, weighed down by a sell-off in large-cap banks. Abu Dhabi Com­mer­cial Bank fell 3.4 per cent and Na­tional Bank of Abu Dhabi lost 2.1 per cent. UAE stock mar­kets, how­ever, have re­cov­ered in re­cent weeks from mul­ti­year lows hit in mid-Jan­uary. Abu Dhabi and Dubai, down 5.7 and 2.7 per cent re­spec­tively in 2016, have out­per­formed both their re­gional peers and crude oil prices this year.

"Gen­er­ally, bet­ter-than-ex­pected re­sults from banks and the rec­om­mended cash div­i­dends com­pa­nies are will­ing to dis­trib­ute have helped UAE eq­ui­ties out­per­form in 2016," said a note by Abu Dhabi's NBAD Se­cu­ri­ties.

Both bourses are ex­pected to con­tinue far­ing bet­ter than their peers at least un­til March, when in­vestors' at­ten­tion will shift to first-quar­ter earn­ings, the note added.

Kuwait Food Co (Amer­i­cana) jumped 4.6 per cent af­ter rock­et­ing 10 per cent on Mon­day. The food com­pany said its board had agreed to give a Gulf-based in­vest­ment firm 60 days to carry out due dili­gence for the ac­qui­si­tion of a con­trol­ling stake in the com­pany. Kuwait's main in­dex fell 0.9 per cent.

Newspapers in English

Newspapers from Pakistan

© PressReader. All rights reserved.