Regional indexes gain on global cues

Major Arabian Gulf stock markets rose yesterday in line with strength in global bourses at the end of last week, with Saudi Arabia and Egypt leading.

The Saudi index rose 0.8 per cent points to 7,145, bouncing for a second straight day from technical support around 7,000 points in very heavy trade.

After initially pulling out of the market in the wake of Saudi Arabia’s crackdown on corruption, announced early last month, retail investors have been coming back in after it became clear that damage to the economy due to the crackdown was not as serious as feared.

Real estate firm Dar Al Arkan, the most heavily traded stock, continued a spectacular uptrend. It surged 9 per cent to 14 Saudi riyals (Dh13.71), having jumped from around 7.5 riyals in mid-November, when MSCI said it was adding the stock to its Saudi Arabia Index.

Petrochemicals firm Saudi Kayan surged 6.2 per cent to 10.64 riyals.

Many analysts consider it fully valued, however; the median target price of six analysts surveyed by Reuters is 9.65 riyals.

Egypt’s index ended a fourday losing streak, climbing 0.7 per cent, but trading volume remained light.

Cleopatra Hospital jumped 7.9 per cent after saying its capital increase had been 99.8 per cent subscribed, while Misr Cement soared 10 per cent as the price of rights in its capital increase rocketed 11.7 per cent.

The Qatari index climbed 0.7 per cent; it has been trading near six-year lows for a month and appears to have established strong support in that area. Gulf International Services added 4.4 per cent.

Dubai came off early highs to end just 0.1 per cent higher while Abu Dhabi climbed 0.4 per cent on the back of a 4.4 per cent gain by Dana Gas, after the chief executive of its major shareholder Crescent Petroleum told the Al Khaleej news service that the main documentation for Dana’s US$700 million of outstanding sukuk was governed by UAE law.

Dana is seeking to avoid redeeming the sukuk after they matured in October, arguing that they are no longer valid under UAE law.

A London court found against Dana last month, but Dana is continuing to fight its case in a UAE court.