Gulf markets down on weak earnings; Qatar extends losing streak
26 Oct 2016 - 22:58
DUBAI: Gulf stock markets saw lacklustre trade yesterday as low oil prices and weak earnings weighed on investor sentiment.
Crude prices declined for a third day, hovering near $50 a barrel for the first time in three weeks, amid doubts that Opec members will agree to a cut output.
Qatar index slipped 0.4 percent as weak earnings weighed on investor sentiment.
“Investor sentiment appears to be weak in general on low earnings visibility,” said Vijay Harpalani, fund manager at Dubai-based Al Mal Capital.
The potential for an agreement among Opec producers, the upcoming US electi`ons and a likely Fed rate hike in December have added to uncertainty in the near-term, Harpalani said.
Abu Dhabi’s index was flat, with trade dominated by stocks due to report third quarter earnings after the market close.
First Gulf Bank, which plans to merge with National Bank of Abu Dhabi, rose 2.8 percent. Etisalat, the telecommunications operator which directly or indirectly operates in about 17 countries across the Middle East, slipped one percent.
“The overall market is weak and liquidity is every tight,” said Nabil Farhat, a partner at Al Fajer Securities in Abu Dhabi.
Dubai’s index slipped almost one percent, dragged down by Emaar Properties which has the largest weighting on the benchmark. The Dubai developer lost 1.9 percent.\ The Saudi index was also flat as gains by the Kingdom’s largest listed lender helped offset losses by petrochemical, cement and retail stocks.
National Commercial Bank, the kingdom’s largest listed lender, climbed almost five percent.
But Saudi Basic Industries Corp, one of the world’s largest petrochemicals group lost 0.6 percent. Saudi Cement, one of the kingdom’s largest cement firms by market value, declined 1.5 percent. Saudi Arabian retailer Fawaz Abdulaziz Alhokair Co was down 2.5 percent.
Kuwait’s index rose 0.27 percent, lifted by the country’s biggest telecoms operator by subscribers, Zain . Zain jumped 2.44 percent to 420 fils.
The ex-monopoly, which operates in eight countries in the Middle East and Africa, has risen 27.2 percent since October 17.
A bourse filing from Zain on Tuesday said it had no material information to disclose behind a spike in trading activity on the company’s shares.
But yesterday, deputy chairman Bader Al Kharafi told Saudi-owned Al Arabiya TV that there was no information about a deal to sell the Kharafi family’s stake in Zain. He said trading activity reflected investor confidence in the company, and that a potential sale would depend on the price. Medicare Group dropped 4.6 percent, leading declines on the bourse. The company reported on October 19 an 85 percent drop in earnings in the third quarter.
Petrochemicals, metals and fertiliser producer Industries Qatar lost 3.6 percent. The company on Sunday reported a 28.9 percent drop in quarterly profit.
Al Meera Consumer Goods reported a 4.6 percent profit decline yesterday and saw shares fall 2.5 percent.
Saudi Arabia index was largely flat, up 0.04 percent to 5,884.99 points and Dubai index lost 0.98 percent to 3,304.2 points.