Men walk pass a sign at the stock market in Dubai yesterday.
Doha/DUBAI: Major Gulf stock markets went in opposite directions yesterday as UAE bourses declined for a second straight day while petrochemicals boosted Saudi Arabia to a fresh multi-year high.
Indexes in both Dubai and Abu Dhabi fell 0.8 percent yesterday — but after rallying for most of this year, Dubai is still up 74 percent year-to-date, while Abu Dhabi is sitting on gains of 45 percent.
“In that context it’s very natural to expect investors to book some gains,” said Amer Khan, fund manager at Shuaa Asset Management.
With the third-quarter earnings season largely over in the UAE, the next big factor on the horizon is the decision on Dubai’s bid to host the Expo 2020 world fair, which is expected on November 27.
Although the emirate has invested heavily in promoting itself as a venue for the event — which could draw millions of tourists — it faces competition from two BRIC heavyweights, Brazil’s Sao Paulo and Russia’s Yekaterinburg, as well as Turkey’s Izmir.
The market is likely to remain jittery until the official announcement is made, said Khan.
“It is very likely we will continue to see this sort of patchy market movement for the next two weeks.”
The Dubai index, which closed yesterday at 2,801 points, has its next underlying support on the August peak of 2,762 points; stronger support lies around the 100-day average, now at 2,601 points. Yesterday’s drop slowed significantly from Monday’s 2.8 percent tumble.
Budget carrier Air Arabia, the UAE’s only publicly listed airline, sank 5.4 percent after reporting a 9 percent drop in third-quarter net profit to 206 million dirhams, missing an average forecast of 241 million dirhams.
But Dubai developer Union Properties bucked the downtrend, rising 0.7 percent after reporting a jump in its third-quarter net profit, making 171.9 million dirhams compared with 49.6 million dirhams a year earlier. The profit hike was driven by a drop in its costs as well as the recovery of Dubai’s real estate market.
Qatar Exchange ended in green area yesterday at 10,072 points or 0.25 percent to 25.48 points from the previous closing of 10,046.57 points on Monday.
The volume of shares were down to 10,438,544 from 14,676,780 on Monday and the value of shares increased to QR 343,189,784.65 from QR 472,713,191.71 on Monday.
Among the top gainers were Qatar National Bank whose share was up 0.59 percent to QR170, Electricity & Water whose share added 1.49 percent to QR163, International Islamic Bank gained 0.34 percent to QR58.50 and Gulf warehousing Co increased by 0.88 percent to QR40.15.
The Banking and Financial sector index gained 0.38 percentage points while Consumer Goods and Services sector index lost 0.08 percentage points. The industrial sector added 0.28 percentage points while the insurance sector was up 0.31 percentage points.
Saudi Arabia’s index continued to strengthen after hitting a five-year high last week. The index rose 0.7 percent on Tuesday while the petrochemical sector - which has reported solid third-quarter earnings - was up 1.8 percent.
The fact that the index has stabilised well above the psychologically important level of 8,000 points - which it has repeatedly broken since August before pulling back - is boosting investors’ confidence, said John Sfakianakis, chief investment strategist at Saudi investment firm MASIC.
“There is evidence of buoyancy and investor interest will continue,” he said.
In year-to-date terms, Saudi Arabia’s rise has been modest compared with the UAE bourses - the index is up 22 percent.
QNA/Reuters
