Middle East markets stay range-bound

06/08/2010 00:00 AST

Markets in the Middle East continued their range-bound trajectory in the absence of any major catalysts, with the exception of Egypt which rose 1.6%.

Aldar Properties slumped to a 16-month low after the real estate company was downgraded by Credit Suisse, weighing on the Abu Dhabi bourse.

Aldar fell 3.8% to 2.31 dirhams, making it the worst performer in Abu Dhabi. Trading in the stock accounted for around one third of total volumes.

“We downgrade Aldar Properties from outperform to neutral and cut our TP (target price) to Dh2.28 per share (from 4.08) due to the write-off of the existing government debt against 70% of the Dh9.1bn government receivable in Q2”, Credit Suisse said.

“We previously believed this receivable would be paid in cash in order to ease Aldar’s current liquidity squeeze and de-leverage the balance sheet, but this catalyst didn’t materialise,” it added.

Abu Dhabi’s index fell 0.2% to 2,529 points.

“The index appears to be stuck in a dull range with most traders awaiting a catalyst. Needless to say, our focus remains on the 2500-2570 zone as we look for a decisive break to determine the following move,” Shuaa Capital said.

Egypt’s main index added 1.6% to 6,407 points, as Talaat Moustafa Group’s court case was postponed and Orascom Telecom said its Algerian accounts had not been frozen.

Talaat Moustafa gained 0.9%. The firm, which is the country’s biggest listed developer, is challenging a ruling that a land sale deal agreed with a body under the housing ministry was illegal.

Traders do not expect the firm’s Madinaty project on Cairo’s outskirts to be cancelled even if the ruling is upheld by a higher court, suggesting a fine or revised contract as more likely outcomes.

Dubai’s bourse advanced 0.3% to 1,518 points.

“A lot of high net worth investors are on holiday and the market talk is that people will start to inject cash into the market towards the end of Ramadan,” said Mohamed Khaled, Prime Emirates relationship manager.

The Omani measure in Muscat edged up 0.1% to 6,357 points, while the Kuwaiti index climbed 0.3% to 6,666 points and Bahrain’s benchmark rose 0.2% to 1,401 points.

Reuters