Saudi stocks drop slightly, Maaden surges 3.3%

17/05/2016 04:55 AST

Major Middle Eastern stock markets fell on Sunday after Moody's cut the debt ratings or outlooks of many countries, while Dubai construction firms dropped steeply after reporting first-quarter earnings.

Moody's lowered its ratings for Saudi Arabia, Oman and Bahrain while assigning negative outlooks to the United Arab Emirates, Oman and Bahrain.

The Saudi stock index spent much of the day higher but closed 0.03 percent lower at 6,693 points, with petrochemicals blue chip Saudi Basic Industries dropping 0.3 percent. Miner Maaden climbed 3.3 percent, however. It is expected to benefit from a drive to develop the mining industry in the Kingdom's economic reform plan.

Saudi International Petrochemical Co. (Sipchem) was flat after Chief Executive Ahmad Al-Ohali told Reuters the firm would be open to reviving its aborted merger with Sahara Petrochemical or pursuing another target, but only once the Kingdom had changed rules governing mergers and acquisitions. Sahara rose 1.3 percent.

Dubai's index dropped 1.2 percent to 3,305 points as Arabtec tumbled 4.6 percent, after its first-quarter net loss narrowed to 46.4 million dirhams ($12.6 million) from 279.8 million dirhams a year earlier. Analysts polled by Reuters had on average forecast a loss of 123.6 million dirhams.

Drake & Scull also sank 4.6 percent after reporting a 61 percent plunge in profit to 9.8 million dirhams. EFG Hermes had forecast 20.1 million dirhams.

Abu Dhabi's index fell 0.3 percent as Aldar Properties lost 1.9 percent. Qatar edged down 0.2 percent but drilling rig provider Gulf International Services jumped 6.5 percent. In Oman, Renaissance Services climbed a further 5.2 percent after jumping its 10 percent daily limit on Thursday, when it said its subsidiary Topaz Energy and Marine were part of a consortium that won a contract to supply and operate 15 vessels for a company in Kazakhstan. Oman's stock index edged up 0.03 percent.

Egypt's index sank 2.0 percent after Moody's cut its outlook to negative from stable, a sign that hoped-for improvements in the economy following massive foreign aid and efforts at reform are still proving difficult to achieve.

Commercial International Bank, Egypt's largest-listed company, slipped 2.2 percent to 43.00 Egyptian pounds after reporting a 17 percent rise in first-quarter net profit, helped by improved interest margins.

Exotix investment bank kept a "buy" rating on the stock with a target price of 49.00 pounds, though it said it was concerned by rising costs at the bank and expectations that the introduction of Basel III global banking standards this year would reduce the bank's capital buffer.

Arab News