Gulf stocks start week on strong footing; Egypt bourse slips back

08/08/2016 08:12 AST

Strength in international equities markets at the end of last week helped lift share prices in the Gulf yesterday with markets most exposed to foreign capital inflows outperforming, while Egypt slipped on profit-taking.

Blue chips helped push Qatar’s index up 1.0% with Vodafone Qatar advancing 2.4%. Pertrochemical conglomerate Industries Qatar, which reported strong earnings late last week, jumped 3.9%.

Dubai’s index climbed 1.1%.

Four-fifths of the traded shares advanced, with companies which have not yet reported quarterly earnings attracting the most volume.

Builder Arabtec climbed 3.4% and amusement park developer Dubai Parks and Resorts added 1.7%.

Abu Dhabi’s index edged up 0.4% as local traders bought small and mid-cap stocks. Insurer Methaq Takaful Insurance jumped 8.1% in heavy trade and Abu Dhabi National Energy rose 2.0%.

In Saudi Arabia the equities index rose 0.7% as all 14 petrochemical stocks advanced; heavyweight Saudi Basic Industries added 0.6%.

Nama Chemicals, a small petrochemical producer, added 3.3% after it announced its board had recommended a 30% share capital increase through a rights issue valued at 400mn riyals ($106.7mn). The company said proceeds would be used to finance the production of new speciality chemicals.

Large-cap companies in other sectors also gained with telecommunications operator Etihad Etisalat (Mobily) climbing 4.1% and retailer Jarir Marketing advancing 4.3%.

Cairo’s main index fell 0.4%, ending three sessions of gains that had taken the benchmark to a 13-month high on Thursday.

Losers outnumbered gainers 13 to 12 as foreign funds were net sellers of Egyptian shares, bourse data showed.

Telecommunications operator Global Telecom Holding lost 3.3%.

Some second-tier stocks seen as laggards rose sharply, however, with GB Auto surging 5.7%. Oriental Weavers, which had jumped 10.0% on Thursday after it announced a five-year plan to boost production capacity across all product lines, climbed a further 6.9%.

On Thursday Egypt said it was making good progress in negotiations with the International Monetary Fund on a loan programme, and expected parliament to pass a long-awaited value-added tax by early September.

“As Cairo inches closer to inking a deal with the IMF, the stock market will continue to be supported,” said Wafik Dawood, portfolio manager at Cairo-based Compass Capital. Elsewhere in the Gulf, the Kuwait index gained 0.6% to 5,492 points, the Oman index edged up 0.1% to 5,875 points and the Bahrain index was flat at 1,157 points.

Reuters