18/01/2011 00:00 AST
Egypt's index made its largest drop in seven months on Monday. Cairo's benchmark fell 2.4 percent to 6,911 points, its largest decline since June 22 as other Middle East indexes also retreated.
Investment bank EFG-Hermes fell 6.4 percent and Telecom Egypt dropped 3.2 percent.
Saudi Arabia's Samba Financial Group fell 3.2 percent, its largest drop since June after its fourth-quarter profit missed estimates, while other banks also fell.
Telecoms firm Mobily rose 0.9 percent, having earlier equaled a two-year high, after it reported above-forecast quarterly profit.
Saudi Fertilizers Co. (SAFCO), an affiliate of Saudi Basic Industries Corp. (SABIC), rose 5.1 percent to a 27-month peak as its quarterly profit nearly tripled.
On Monday, SABIC said SAFCO had canceled plans for a steel plant. SAFCO will look into building a fertilizer plant, SAFCO 5, to produce urea. SABIC climbed 1.4 percent.
"(This) will enable SAFCO to focus on its core business, which offers considerably higher margins," said Ankit Gupta, senior research analyst at Securities & Investment Co. (SICO).
"SAFCO has been a leveraged play on urea and ammonia prices, but capacity increase will provide support to earnings growth as well. For SABIC, what it loses from steel will be more than offset by increased SAFCO earnings. It's marginally accretive."
The Tadawul All-Share Index (TASI) fell 0.3 percent to 6,768.24 points. The sector activity for the day was negative except two gaining sectors. The losing sectors ranged from 0.22 percent by the Real Estate Development sector to 3.05 percent by the Transport sector. On the other hand the gaining sectors were the Energy & Utilities sector with 0.58 percent and the Petrochemical Industries sector with 0.84 percent. The overall market breadth for the day was negative with 28 advancers against 101 decliners giving it an AD ratio of 0.27, the Capital Market Authority (CMA)-licensed Financial Transaction House (FTH) said in its daily market commentary.
The stock market turnover for the day reached SR3.97 billion.
Abu Dhabi's Aldar Properties fell 3.8 percent to a new five-month low, extending losses since unveiling a restructuring plan dilutive to shareholders. The Abu Dhabi index fell 0.9 percent 2,690 points.
UAE markets are struggling to arrest their decline. Volumes hit to a six-year low in 2010, and trade is also muted this year, while Dubai is down 74 percent from a 2008 peak. On Monday, however, the Dubai index rose 0.5 percent to 1,609 points.
"The catalyst can't come from the outside like oil prices going up or the US economy recovering, it will have to be something internal and fundamental," said Haissam Arabi, chief executive and fund manager at Gulfmena Alternative Investments.
Oversupply in the real estate market and lackluster earnings growth at banks make this is difficult, he adds.
The Kuwaiti index dropped 0.1 percent to 6,915 points. The Qatari index dropped 0.9 percent to 9,164 points.
The Omani index slipped 0.08 percent to 7,022 points, while the Bahraini index dropped 0.3 percent to 1,432 points.
Arab News
Please wait...
