Tadawul index drops 0.3%

28/11/2014 06:30 AST

Most Gulf stock markets fell, while Egypt’s bourse rose as Cairo’s government eyed savings from cheaper crude.

Saudi Arabia’s stock market, where petrochemicals account for a large part of corporate earnings, stands to lose most from cheaper oil, but some investors fear that governments across the region may cut spending, which would have a knock-on effect on economies in general.

The main Tadawul All-Share Index fell 0.3 percent to 9,056 points, but closed above its intraday low of 8,956 points after Saudi Basic Industries attracted buying near a 14-month low, rebounding to close 0.6 percent higher. Some other blue chips also rebounded. Qatar’s benchmark fell 1.4 percent with all but one stock in decline.

Industries Qatar climbed 0.8 percent, further recovering from Tuesday’s 4.0 percent drop. Abu Dhabi’s index lost 0.5 percent as heavyweight lender First Gulf Bank declined 1.9 percent. Dubai’s bourse bucked the downbeat trend, rising 1.2 percent. Builder Arabtec Holding surged 6.2 percent and Emaar Properties climbed 1.9 percent.

Arabtec rose after a source with knowledge of the matter said on Wednesday that its former chief executive Hasan Ismaik plans to sell his remaining 11.8 percent stake in the company, but will only offload the shares if he is paid at least AED5.00 per share, a premium to its closing price of AED3.97.

Emaar, which tumbled 5.3 percent on Wednesday, rebounded ahead of Nov. 30, which is the record date for a special dividend of AED1.257 per share.

Egypt’s index rose 1.0 percent in a broad rally after a visiting International Monetary Fund mission said economic reforms have begun to turn the economy around after years of turmoil. Energy importer Egypt expects to spend 25 percent less than budgeted for on fuel subsidies this fiscal year due to a fall in crude oil prices, a top oil ministry official said on Thursday.

Reuters