Corporate news affect regional stocks
Corporate news pulled down stock markets in Saudi Arabia and Dubai yesterday, while Abu Dhabi was supported by a strong new listing and Qatar surged after the release of the government’s 2018 budget.
The Dubai index dropped 1.4 per cent as Emaar Properties sank 6.2 per cent to its lowest close since June, in its heaviest trade since June.
Emaar said it would pay a special dividend of Dh4 billion related to its listing of Emaar Development – Dh3bn next month and Dh1bn after its annual general assembly in April.
That equates to a dividend of Dh0.56 per share. The market had originally expected Emaar to distribute about Dh1 per share, and expectations had then been revised to around Dh0.67 based on the assumption that the entire proceeds of the 20 per cent listing would be paid.
Abu Dhabi edged up 0.1 per cent with sentiment supported by a firm debut by the fuel distribution unit of Abu Dhabi National Oil Company (Adnoc) after the market’s first initial public offer in six years.
Adnoc Distribution opened at Dh2.90 and closed at Dh2.65. There had been concern about the debut because the initial pricing range of the IPO was lowered and Emaar Development had a weak debut in Dubai last month.
In Saudi Arabia, the index fell 0.4 per cent as Saudi Electricity plunged 9.9 per cent in its heaviest trade since June 2016. The stock had climbed 3.5 per cent on Tuesday in anticipation of the government announcing hikes in electricity tariffs, and after the close, the regulator revealed higher tariffs for residential and commercial users from January 1.
But the company said it would pay the government a fee equivalent to the rise in tariffs, so there should be no positive impact on its profits.
The most heavily traded stock, real estate firm Dar Al Arkan, jumped 9.9 per cent after falling for two days. It has soared since mid-November, when international index compiler MSCI said it was adding the stock to its Saudi Arabia Index.
Al Tayyar Travel, whose founder has been detained in Saudi Arabia’s crackdown on corruption, edged down 0.4 per cent. The company announced a transformation plan that includes new products such as insurance and boosting electronic platforms.