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Weak oil and global bourses pull down Gulf; Egypt rises

Reuters , Tuesday 2 Aug 2016
Stock exchange
Traders work at the Egyptian Stock Exchange. (File Photo: Reuters)
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Weak oil prices and global equity markets pulled down stocks in the Gulf on Tuesday, with some Saudi Arabian petrochemical shares and banks falling sharply, but Egypt edged up on the back of its currency's firmness in the unofficial market.

The Saudi index sank 1.2 percent as petrochemical giant Saudi Basic Industries fell 1.5 percent and Saudi British Bank lost 2.7 percent.

But major retailer Jarir Marketing, which had dropped 18 percent from its June peak because of Saudi Arabia's economic slowdown, rebounded 2.5 percent.

Dubai's index dropped 1.3 percent as Emaar Properties lost 1.6 percent, almost erasing its gain of the previous day after posting strong second-quarter earnings.

Strong earnings from Abu Dhabi's Aldar Properties failed to boost that market, where the main index dropped 1.6 percent. Aldar fell 2.1 percent after reporting a 9.7 percent rise in second-quarter net profit to 657.4 million dirhams ($179 million), beating SICO Bahrain's forecast of 384.1 million. Abu Dhabi banking shares were also very weak.

Qatar outperformed, falling only 0.3 percent because of a 1.3 percent rise by Qatar National Bank, the market's biggest lender, to 154.50 riyals, its highest close since last November.

But Vodafone Qatar, the most heavily traded stock, dropped 1.6 percent to 11.32 riyals after QNB Financial cut the stock to an 'underperform' rating, lowering its target price to 8.10 riyals from 9.30.

Egypt's index rose 0.6 percent as the Egyptian pound continued strengthening on the black market, suggesting short-term capital outflows may have eased or even halted on a net basis.

Sentiment towards the pound has improved somewhat since last week's news that Egypt is negotiating an International Monetary Fund loan, although a devaluation of the official exchange rate is still widely expected.

Oriental Weavers Carpet Co jumped 8.0 percent after reporting a second-quarter net profit of 178 million Egyptian pounds ($20.05 million), up from 124 million pounds a year earlier.

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