Construction stocks big movers in region

Middle Eastern stock markets edged up in quiet trade yesterday, with construction and building materials stocks boosting Saudi Arabia ahead of the release of its 2018 state budget this week.

Saudi Arabia’s index added 0.3 per cent as builder Khodari surged 7.6 per cent in its heaviest trade since January. Najran Cement gained 4.5 per cent and in addition to Khodari, the 10 best-performing stocks featured six cement producers.

The state budget, to be announced tomorrow, is expected to be modestly expansionary and include a rise in infrastructure spending after two years of austerity.

Real estate firm Dar Al Arkan, the most heavily traded stock, fell back 3.6 per cent after soaring in the last several weeks.

The Dubai index edged up 0.3 per cent as construction firm Drake & Scull, which operates in Saudi Arabia, was the most heavily traded stock, rising 1.4 per cent.

The Kuwait stock index added 0.4 per cent after surging 1.5 per cent last Thursday. Kuwait Finance House climbed 0.7 per cent.

Other Arabian Gulf central banks, whose currencies are pegged to the US dollar, raised interest rates in the wake of the US Federal Reserve’s hike last week.

But Kuwait, citing a desire to boost economic growth, did not tighten monetary policy; it manages its dinar against a dollar-dominated basket, which gives it more flexibility in policy.

In Egypt, the index climbed 0.3 per cent as Egypt Gas, which handles natural gas engineering and maintenance work, soared 10 per cent. The company is expected to benefit from work related to Egypt’s Zohr gasfield, where pilot production of gas started this month.

At the end of last week Egypt Gas forecast 2018 revenues of 2.61 billion Egyptian pounds (Dh536.4m) and net profit of 24.6 million pounds, compared to revenue of 1.10bn pounds and a net loss of 57 million pounds in the first nine months of this year.

Markets in Qatar and Bahrain were closed for national holidays.

Meanwhile, emerging market stocks were nursing losses, with the MSCI benchmark index down 0.5 per cent, weighed down by Wall Street’s weakness on concerns about the progress of US tax reform.