Dubai shares decline on overdone rally

dubai — Dubai’s benchmark stock index fell the most in a month, tracking a decline in global markets last week, on investor concern this year’s rally was overdone given prospects for earnings growth. Saudi Arabia’s gauge dropped.

The DFM General Index tumbled 1.7 per cent, the most since March 12, to close at 4,759.15 point in the emirate. Dubai Islamic Bank, the UAEs’ biggest Shariah- compliant bank, declined for a third day. Emaar Properties, had its steepest drop in a month. Saudi Arabia’s Tadawul All Share Index fell 0.9 per cent, while Al Rajhi Bank plunged the most in seven months as first-quarter profit trailed analysts’ estimates.

Dubai Islamic Bank fell 2.9 per cent to Dh6.31. Emaar, which is planning an initial public offering of its malls business, declined 2.9 per cent to Dh10.2.

Shuaa Capital surged as much as 5.3 per cent after making a profit in the first quarter following three years of losses in such period. Lending and investment banking boosted earnings. It later retreated to close 0.6 per cent higher at Dh1.72.

Benchmarks in Abu Dhabi and Kuwait both lost 0.2 per cent while Bahrain fell fell 0.1 per cent. Oman advanced 0.2 per cent. Qatar’s QE Index declined 1.4 per cent.

Al Rajhi Bank fell 3.3 per cent to 72.3 riyals. Saudi Arabia’s biggest listed lender said firstquarter net income fell 17 per cent to 1.7 billion riyals ($453 million) versus estimates of 2.08 billion riyals, data compiled by Bloomberg show.

Qatar National Bank SAQ , the country’s largest lender, dropped 1.7 per cent, the most in a month. Petrochemicals maker Industries Qatar fell 1.5 per cent, the biggest in two weeks.

“The market had a good run the past couple of weeks so there is some profit taking especially given what is happening in the overall global markets,” Saugata Sarkar, head of research at Qatar National Bank Financial Services, said by phone from Doha today. “Given that we have a MSCI upgrade happening, there is still some upside.”—