Saudi underperforms region but car-related shares rise

Stocks in Abu Dhabi and Dubai posted minor gains

State Street Global Advisors is bullish about the pace of the capital market reforms in Saudi Arabia and the kingdom’s inclusion into the major emerging market indexes. Simon Dawson / Bloomberg
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Most stock markets in the Middle East made small gains on Monday with Egypt hitting yet another all-time high, while the Saudi Arabian index edged down.

The Riyadh index lost 0.1 per cent; the banking sector was soft with Banque Saudi Fransi dropping 1.3 per cent.

Shares of telecommunications operator Atheeb, which had been suspended by the capital markets regulator since September 25, tumbled 3.1 per cent.

The company on Monday issued a statement saying it was still waiting for authorities to grant it a unified licence, which would enable Atheeb to obtain a loan to build its spectrum and pay its dues to the telecommunications regulator.


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Shares of car-related companies, however, resumed rising after the government said last week that it would next year lift a ban on women driving.

Car rental company United International Transport (Budget Saudi) climbed 3.2 per cent and car servicing company Saudi Automotive jumped 4.0 per cent in active trade.

Banking shares helped take Qatar's index 0.1 per cent higher; Masraf Al Rayan rose 1.5 per cent.

The latest monthly Reuters poll of regional fund managers, published on Thursday, showed sentiment toward Qatar's stock market had on balance turned positive after it plunged in response to sanctions imposed by other Arab states.

Valuations have in some cases reached distressed levels and dividend yields are attractive. Masraf Al Rayan, for example, had a dividend yield of 5.5 per cent as of Monday's close.

In Kuwait, some shares continued to be bid up after rising on Sunday on news that index compiler FTSE was upgrading Kuwait to secondary emerging market status. Warehousing company, Agility, added a further 1.1 per cent. The main index finished almost flat.

The Dubai index rebounded 0.5 per cent as most mid- to large-sized companies rose, including Emaar Properties, which climbed 1.1 per cent. It is expected soon to reveal the valuation of its local real estate development arm, in which it plans to offer a stake to the public.

In Abu Dhabi, the index added 0.4 per cent as three of the top five most valuable shares rose; First Abu Dhabi Bank gained 0.5 per cent.

Egypt's main index rose 0.2 per cent to 14,000 points, a record high, but closed 102 points below its intra-day high, showing substantial profit-taking pressure.

The index has gained momentum in the last 10 days as it has started to price in a reversal of tight monetary policy.

Egyptian Chemical Industries, which is proceeding with a capital increase, soared almost 10 per cent in its heaviest trade ever on Monday. But private equity firm Qalaa Holdings lost 3.8 per cent after it reported a wider net loss for the first half of the year.