Tadawul index closes just below technical resistance

15/10/2015 05:23 AST

Most Gulf stock markets fell in modest trading volumes on Wednesday with the weakness of global equity markets putting a dampener on activity as well as the approach of a holiday in many countries on Thursday to mark the Islamic New Year.

Dubai’s stock index fell 0.4 percent as real estate blue chip Emaar Properties lost 1.6 percent. Abu Dhabi dropped 0.6 percent as banks were weak, with National bank of Abu Dhabi retreating 0.9 percent.

Abu Dhabi’s United Arab Bank reported a net profit of AED72 million ($19.6 million) for the first nine months of 2015, sharply down from 498 million dirhams a year earlier. It said profit was hit by third-quarter loan provisions of AED466 million following a significant increase in loan defaults in UAB’s higher risk commercial loan portfolio.

The highly illiquid stock did not trade on Wednesday, but the provisions may show that smaller UAE banks are starting to feel the pain of tighter liquidity and deteriorating asset quality due to low oil prices and could be a negative signal for the banking sector as a whole.

Qatar’s index slipped 0.7 percent as Vodafone Qatar, the most heavily traded stock, pulled back 1.8 percent. But Qatar Fuel Co. (Woqod) added 1.9 percent.

Saudi Arabia’s market, which will remain open on Thursday, performed relatively well with the Tadawul All-Share Index edging up 0.1 percent to 7,785 points.

It has been flirting this week with technical resistance at 7,812-7,953 points, its highs in September and at the end of August.

Major petrochemical producer Saudi Basic Industries slipped in early trade but closed 2.3 percent higher, a sign of improving sentiment toward the beaten-down sector. The stock is up 14 percent since the end of last month.

Some second-tier stocks moved in response to third-quarter earnings. National Company for Glass Industries sank 4.4 percent after reporting a 63 percent plunge in quarterly profit. The Egyptian and Kuwaiti bourses were closed for the Islamic New Year on Wednesday; Egypt is to reopen on Thursday.

Arab News