20/05/2011 00:00 AST
Egypt’s Orascom Telecom hit a six-month high yesterday after its first-quarter profit soared following the sale of a stake in another operator, while Gulf Arab markets fell. Orascom Telecom’s shares climbed 7.2 percent, their highest finish since November 22 and largest gain in seven weeks.
The operator’s quarterly profit rose to $813m from $49m a year earlier. Analysts welcomed a bigger than expected gain in earnings before interest, tax, depreciation and amortisation (EBITDA), but attention is now on Orascom’s future structure after Russian operator Vimpelcom bought assets of its parent company Wind Telecom in a $6bn deal.
The Egyptian benchmark index rose 1.2 percent, taking its gains to 4.9 percent this week as local retail traders and some Arab Gulf investors returned. Dubai’s benchmark slipped 0.4 percent, taking its May losses to 3.1 percent. “Pretty much the whole market is being driven by external and macro level factors - there’s a bit of uncertainty in global markets in general,” says Robert McKinnon, ASAS Capital chief investment officer. “People want to take risk off the table, going into the weekend.”
Emaar Properties fell 0.9 percent after saying it would write off its investment in Dubai Bank following a government takeover. “We’re at the later stage of these write offs, so the market is looking past it,” added McKinnon.
Abu Dhabi’s index eased 0.2 percent, halting a two-day rebound as Dana Gas and Sorouh Real Estate each slid 1.5 percent. Elsewhere, institutional buying lifted Oman’s index from the previous day’s 17-month low. The benchmark ended 0.3 percent higher, snapping a nine-session losing streak.
“We have seen institutional buying interest at the lower levels,” said Kanaga Sundar, Gulf Baader Capital Markets head of research. “Today’s buying is seen as a bounce back, the market was expecting it.” Bluechips Bank Muscat and Renaissance Services rose 0.6 and 0.8 percent respectively.
“Counters like Nawras, Bank Muscat, and Renaissance look attractive at current levels. It’s a better time to invest if you are looking at the medium to longer term,” added Sundar. Kuwait’s Jazeera Airways tumbled 5.2 percent.
Jazeera made a quarterly profit of 1.03m dinars ($3.69m), compared to a net loss of 4.5m dinars in the year-earlier period, according to a statement on its website. Heavyweight Zain fell 1.9 percent and Gulf Bank dropped 1.8 percent. Qatar’s index bucked the regional trend despite low buying interest, ending 0.2 percent higher as gainers outnumbered losers two to one.
HIGHLIGHTS
EGYPT: The measure rose 1.2 percent to 5,249 points.
DUBAI: The index eased 0.4 percent to 1,583 points.
OMAN: The index climbed 0.3 percent to 6,048 points.
KUWAIT: The measure slipped 0.2 percent to 6,476 points.
QATAR: The benchmark gained 0.2 percent to 8,637 points.
ABU DHABI: The index eased 0.2 percent to 2,655 points.
BAHRAIN: The measure fell 0.3 percent to 1,372 points.
Reuters
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