Gulf Times - Gulf Times Business
Saudi stocks hit more than two-week low as weak oil prices weigh
Oil price slump hurts sentiment across Gulf markets; Sahara Petrochemical shares hurt by shutdown of unit’s plant; cement shares aided by speculation on Yemen reconstruction; property shares weigh on Dubai; Global Telecom up 5.9% on rumours about new tend
Saudi stocks slumped to their weakest level in more than two weeks yesterday, hurt by the latest slump in oil prices, which also dragged most Gulf markets lower.
Saudi Arabia’s index shed 0.4% to close at 7,711 points, its lowest close since October 24.
Oil refiner Petro Rabigh dropped 1.7% and National Commercial Bank fell 0.6%. Saudi insurance firm Mediterranean and Gulf Cooperative Insurance and Reinsurance (MedGulf) was also down 1.1% despite reporting a 70% rise in thirdquarter net profit.
Shares of Saudi Arabia’s Sahara Petrochemical fell 3.6% after the company declared an emergency shutdown of a petrochemical plant at its subsidiary Al Waha Petrochemical due to technical issue.
Saudi cement shares, however, bucked the market trend as some investors hoped an eventual end to the Yemen war will boost regional cement demand for reconstruction in the country.
President Donald Trump’s administration has reinforced its call for a ceasefire and said the “climate is right” for UN-backed peace talks to resume.
Najran Cement ended 3.1% higher and Southern Cement surged over 6%.
Abu Dhabi stocks fell 0.5% to 5,002 points, with Abu Dhabi National Energy Co (Taqa) slumping 3.6% as weak oil prices eclipsed strong third-quarter earnings last week.
Oil prices fell nearly 1% on Friday as global supply increased and investors worried demand growth could slow, sending US crude to its longest stretch of daily declines since 1984.
Weakness in property stocks weighed on the Dubai index, which ended 0.3% lower at 2,818 points.
Emaar Properties dropped 0.8% and Damac Properties fell 1.4%.
In Egypt, financials weighed on the index with Commercial International Bank Egypt falling 2.3% and EFG Hermes declining by 1.5%.
Global Telecom gained 5.9% amid market speculation that its major shareholder could weigh another tender offer for the company.
The speculation was driven by the company’s announcement last week about the appointment of Naeem Financial Investments as independent financial adviser to evaluate “fairness value” of its shares in respect of a capital increase.
Amsterdam-based Veon, which owns a 56% stake in the company, had made a tender offer to buy the remaining shares in Global Telecom earlier this year, but the bid did not succeed due to regulatory obstacles. “Rumours of another tender offer is driving the stock higher, but [there is] no formal indication from the company that such an offer is coming,” said a trader in Egypt. The Egypt index fell 1.2% to 13,571 points.
Elsewhere in the Gulf, the Bahrain index was flat at 1,313 points, the Oman index was up 0.3% at 4,504 points and the Kuwait index ended little changed to 5,301 points.