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Wednesday, 16 October 2019

Region mostly weak but blue chips buoy Egypt as foreigners buy

Reuters , Monday 5 Feb 2018
Stock market
File Photo: Egypt's stock market (Ahram Online)
Views: 2959
Views: 2959
Most Middle Eastern stock markets fell on Monday in line with a weak global trend, with Saudi Arabia seeing profit-taking in cement shares, but Egypt rose on the back of several blue chips.
The region had already dropped on Sunday in response to Wall Street’s Friday plunge, so Gulf markets far outperformed other bourses in Asia, where MSCI’s broadest index of Asia-Pacific shares outside Japan was down 1.4 percent on Monday afternoon.
The Saudi index slipped 0.3 percent as Tabuk Cement pulled back 1.9 percent. Tabuk and many other firms in the sector had jumped in the past several days on a media report that the government had started awarding contracts to build the huge NEOM business zone in the northwest of the country.
Many petrochemical shares were soft but PetroRabigh soared 9.9 percent after reporting fourth-quarter net profit jumped to 641‍​ million riyals ($170.9 million) from 181 million riyals a year ago, as sales increased 27 percent.
“There is a high level of debt - we are working on debt amortisation. God willing in 2020 we’ll finish paying all debts from the first phase of PetroRabigh, and what remains are debts from the second phase,” PetroRabigh chief executive Nasser al-Mahasher told Al Ekhbariya television.
”This will reduce the level of indebtedness and will reflect on company performance and profitability.”
Mediterranean & Gulf Cooperative Insurance and Reinsurance plunged a further 9.4 percent after losing 9.9 percent on Sunday, when the Capital Market Authority said it might suspend or cancel trade in the stock following the central bank’s decision to prohibit the firm from issuing or renewing policies pending a capital increase.
Telecommunications firm Mobily surged 6.1 percent to 16.30 riyals in its highest volume for nearly a month after HSBC said the company was its preferred pick in the sector, with a target price of 25.50 riyals.
Dubai’s index fell 0.2 percent. Most real estate firms dropped with Emaar Properties 0.6 percent lower, but construction firm Arabtec climbed 1.9 percent.
In Qatar, the index slid 1.4 percent, bringing its losses in the past five trading days to 6.5 percent and making Qatar the worst-performing Gulf market in that period by a large margin.
Qatari banks, working to raise funds abroad in the face of the embargo by other Arab states, may face higher funding costs because of the recent jump in U.S. yields. That could ultimately hurt real estate firms, which have already been hit by a property market slump magnified by the embargo.
Salam International Investment plunged its 10 percent daily limit after posting an annual net loss of 89.9 million riyals ($24.7 million) versus a year-earlier profit of 119.7 million riyals.
Qatar Islamic Bank bucked the downtrend, gaining 3.4 percent in its heaviest trade since last March.
In Egypt, the index rebounded 0.6 percent as Global Telecom gained 2.9 percent and investment firm Qalaa Holdings, the most heavily traded stock, added 5.7 percent. Exchange data showed foreign investors were net buyers of Egyptian stocks by a considerable margin.
National Housing rocketed 10 percent after saying it would hold an auction this month to sell the Meridian Heliopolis hotel.
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