Saudi market slips on Yemen concerns; Egypt falls
DUBAI, May 3, (RTRS): Saudi Arabia’s stock market edged down on Sunday after reports that the Saudi-led coalition fighting Houthi rebels in Yemen had deployed ground troops there, while Dubai pulled back after failing to break through major technical resistance.
An Arab ground force arrived in the southern Yemeni city of Aden on Sunday and started fighting Houthi forces, Yemen’s Aden al-Ghad newspaper reported. A speaker for the Saudi-led coalition said it had not started any major ground offensive.
The Yemen conflict has so far had no visible impact on Saudi Arabia’s economy, and it has remained within Yemen’s borders. However, it is a concern for some Gulf investors who see a risk, however small, of an escalation into a regional conflict.
The main Saudi index gave up early gains and edged down 0.7 percent to 9,764 points as most stocks declined. Petrochemicals giant Saudi Basic Industries (SABIC) fell 0.9 percent even though oil hit a new 2015 high of $66.93 per barrel on Thursday.
Middle East Paper Co surged its daily 10 percent limit upon listing on Sunday after a heavily oversubscribed 450 million riyal ($120 million) initial public offer. Saudi Arabian share offers are usually heavily discounted, prompting stocks to surge afterwards, sometimes for several days in a row.
Dubai’s index dropped 2.3 percent to 4,132 points after initially inching above a strong chart barrier at its 200-day average, now at 4,244 points. Heavyweight Emaar Properties tumbled 3.6 percent.
After trading closed, Emaar reported a 7 percent increase in first-quarter net profit to 1.03 billion dirhams ($280.4 million), beating the estimate of SICO Bahrain, which had expected a decline to 856.8 million dirhams.
Dubai’s index gained 20 percent last month as oil prices rebounded and the emirate’s banks posted better-than-expected first-quarter earnings. The benchmark has strong technical support around 4,000 points, where it peaked repeatedly between December and February.
Abu Dhabi, which largely shares its investor base with Dubai, fell 0.6 percent.
Qatar’s bourse added 0.3 percent as petrochemicals and metals conglomerate Industries Qatar, which is set to benefit from recoveing oil prices, jumped 2.0 percent.
Kuwait’s index edged up 0.2 percent. Kuwait Projects Co (KIPCO), the Gulf state’s largest investment company, climbed 1.5 percent after reporting a 17 percent rise in firstquarter net profit on Saturday.
Egypt’s market fell 1.3 percent after the country’s finance minister said on Thursday that discussions over amendments to the capital gains and dividends tax concerned only the payment mechanism.
Investors unhappy with the new levies had hoped they would be able to persuade the government to remove or change them, for example by replacing the capital gains tax with a stamp duty.
Saudi Arabia
The index edged down 0.7 percent to 9,764 points.
Dubai
The index dropped 2.3 percent to 4,132 points.
Abu Dhabi
The index edged down 0.6 percent to 4,619 points.