Saudi stocks only bright spot in re­gion

The National - News - - BUSINESS MONEY & MARKETS -

Saudi stocks were lifted yes­ter­day by op­ti­mism about fund flows, while other bourses in the re­gion were lack­lus­tre.

The Saudi in­dex closed 1 per cent higher, lifted by fi­nan­cial stocks. In­sur­ance com­pany Bupa Ara­bia gained 5.5 per cent af­ter it rec­om­mended an in­crease in cap­i­tal to 1.2 bil­lion riyals ($320m) from 800m riyals through a one-for-two bonus share is­sue.

Banks were also up, with Al Ra­jhi Bank gain­ing 2.7 per cent, re­turn­ing to the mul­ti­year high hit last week.

“In­vestor sen­ti­ment is still pos­i­tive on Saudi due to rel­a­tively higher oil prices. Over­all, we have pos­i­tive vibes in the mar­ket for now ahead of a (po­ten­tial) MSCI up­grade,” said Muham­mad Faisal Potrik, head of re­search at Riyad Cap­i­tal. In­dex com­piler MSCI will de­cide in June whether to up­grade Riyadh to emerg­ing mar­ket sta­tus.

In Dubai, Emaar Prop­er­ties fell 1.7 per cent, push­ing the in­dex 0.3 per cent lower.

Emaar, which has lost 10 per cent so far this year be­cause of a weak lo­cal real es­tate mar­ket, has been a big drag on the in­dex. In Oman, Na­tional Bank of Oman fell 1.6 per cent af­ter it re­ported a nearly 9 per cent drop in quar­terly net profit to 12.6m ri­als ($32.72m), be­low EFG Her­mes’s fore­cast of 13.3m ri­als but above Gulf Baader Cap­i­tal Mar­kets’ 11.1m ri­als. Mean­while, ner­vous­ness about new West­ern sanc­tions on Rus­sia kept the rou­ble and Moscow stocks on the back foot yes­ter­day, while emerg­ing mar­kets were weak gen­er­ally af­ter the lat­est clamp-down on risky lend­ing in China hit its mar­kets. A host of sto­ries were un­fold­ing, in­clud­ing Hong Kong dol­lar pres­sure, po­lit­i­cal strains in Kenya and Zam­bia and a sur­prise ratings up­grade for Poland, but it was the swings in Rus­sia that again dom­i­nated the mar­kets’ fo­cus.

The rou­ble had re­cov­ered most of its early losses against the dol­lar but was still slightly weaker against the euro, trad­ing at 61.92 and 76.52 re­spec­tively.

Moscow’s dol­lar-de­nom­i­nated RTS share in­dex fell 0.6 per cent to 1,098.26 points and the rou­ble-based MOEX in­dex dropped 0.2 per cent to 2,171.28 points.

Alu­minium gi­ant Rusal, which was the main vic­tim of the lat­est sanc­tions, saw its shares shed an­other 6 per cent too, though sov­er­eign bond mar­kets were no­tably calmer af­ter their re­cent lurches.

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