MIDEAST STOCKS-Gulf markets gain as oil nears $39; Egypt up but worries loom – Reuters

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* Blue chips lift Saudi in highest volume since mid-January

* Dubai up as Arabtec, Drake & Scull soar

* Banks and mid-sized stocks bolster Abu Dhabi

* Investors ignore Moody’s debt reviews of Gulf states

* OTMT boosts Egypt but most foreign buyers absent

By Celine Aswad

DUBAI, March 6 Firmer oil prices and a revival
of global risk appetite helped lift stock markets in the Middle
East on Sunday, as heavyweight petrochemical firms and banks
boosted Saudi Arabia’s bourse in heavy trade.

Moody’s Investors Service put the debt ratings of Saudi
Arabia, the United Arab Emirates, Kuwait and Qatar on review for
possible downgrade late on Friday, and cut Bahrain’s rating to
junk, citing low oil prices.

But many investors saw this as a belated response to old
news, and focused instead on oil’s rebound near $39 a barrel in
the past couple of weeks.

“This is not really new news,” a Jeddah-based analyst said
of the Moody’s action. “I believe the bottoming of oil prices
will outweigh the negative impact of the cut in outlook to

Riyadh’s index rose 2.9 percent in the highest
volume since Jan. 20. Short-term technicals have turned positive
for Saudi Arabia, which triggered a bullish right triangle by
breaking its January peak last week; it closed very near its
session high on Sunday.

Leading petrochemical producer Saudi Basic Industries
gained 3.4 percent and Samba Financial Group
added 4.5 percent.

Dubai’s index also jumped 2.9 percent as shares in
construction firm Arabtec surged 13.0 percent, after
adding 8.0 percent on Thursday. They have been swinging wildly
in speculative trade since exchange data at the start of last
week showed former chief executive Hasan Ismaik had raised his
stake in the company to 11.91 percent from 11.81

Other speculative shares favoured by local traders also
attracted volume, with builder Drake & Scull surging
13.1 percent to 0.48 dirhams; it is now up 66 percent from its
record low in mid-January. Nine analysts polled by Thomson
Reuters on the stock believe it is fairly valued, as their
median price target is 0.42 dirhams.

But, in contrast to last week’s rebound in Dubai’s market,
blue chips also posted strong gains. Emaar Properties
surged 2.6 percent and Emirates NBD added 2.5 percent.

Abu Dhabi’s benchmark gained 3.1 percent with volumes
concentrated in mid-cap companies including Eshraq Properties
and Dana Gas, the two most heavily traded
stocks, which climbed 5.4 and 3.9 percent respectively.

But the banking sector, which was largely dormant last week,
was active on Sunday with heavyweights National Bank of Abu
Dhabi and First Gulf Bank jumping 2.3 and 4.7


In Cairo, the main index rose 2.1 percent as local
traders were net buyers, while foreign buyers were largely
absent, bourse data showed.

Last week investors were hesitant to buy Egyptian shares
because of a possible interest rate hike, after bond yields
rose, and a weakening currency on the black market, which has
increased speculation about a possible devaluation.

These factors have not disappeared. But Orascom Telecom
, the most heavily traded stock, jumped 7.0 percent
after it said its board had approved 924 million Egyptian pounds
($118 million) of financing for its subsidiary Beltone Financial
to acquire CI Capital, the investment arm of Egypt’s
largest listed lender, Commercial International Bank.

Beltone soared a further 9.9 percent, after more than
doubling in price over the past two weeks; CIB added 2.2



* The index rose 2.9 percent to 6,396 points.


* The index gained 2.9 percent to 3,344 points.


* The index jumped 3.1 percent to 4,556 points.


* The index rose 2.1 percent to 6,215 points.


* The index added 0.7 percent to 5,281 points.


* The index edged up 0.04 percent to 5,407 points.


* The index added 0.1 percent to 1,175 points.

(Editing by Andrew Torchia and Andrew Bolton)

MIDEAST STOCKS-Gulf markets gain as oil nears $39; Egypt up but worries loom – Reuters}