MIDEAST STOCKS-Oil’s retreat halts Gulf equity rally – Reuters

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* Petrochemicals lead Saudi down with Brent below $33

* Retailing stocks weak after high inflation data

* Dubai retreats from chart resistance

* Drake & Scull continues recovery

* Bahrain outperforms on Ahli United Bank earnings

By Andrew Torchia

DUBAI, Feb 24 Most Middle Eastern stock markets
fell on Wednesday after oil prices pulled back sharply,
interrupting a rally that had been built to a large extent on
hopes that crude had bottomed out.

As Brent crude fell back below $33 a barrel, the
Saudi stock index dropped 1.3 percent to 5,942 points,
retreating from close to technical resistance at the February
and January peaks of 6,056-6,098 points.

The petrochemical sector led the market down with Saudi
Basic Industries losing 2.1 percent. Second-tier
speculative stocks also tumbled. Saudi Paper, which
had jumped 8.1 percent in unusually heavy trade on Tuesday,
tumbled 8.1 percent on Wednesday.

Retailing firms were weak. Al Othaim Markets, a
supermarket chain, fell 1.9 percent although the board
recommended a cash dividend of 2.00 riyals per share for 2015,
up from 2014 and above NCB Capital’s forecast of 1.75 riyals.

The retail sector may be hurt this year by the erosion of
consumers’ purchasing power after inflation spiked in January.
On Tuesday the kingdom’s statistics department said consumer
price inflation hit 4.3 percent year-on-year, the highest since
the data series began in 2012, after austerity measures in the
state budget raised costs of electricity, water and gasoline.

“We anticipate domestic inflationary pressure to intensify
during 2016, driven by second-round effects stemming from the
recent energy price reforms,” said a research note by
Riyadh-based Jadwa Investment.

Dubai’s index fell 1.7 percent to 3,137 points as
investors booked profits close to chart resistance at the late
December peak of 3,189 points.

Emirates NBD, the largest lender by market value,
fell 2.8 percent after adding 2.6 percent the previous day. The
shares went ex-dividend on Wednesday. On Tuesday, Goldman Sachs
raised its recommendation for the stock to “buy” from “neutral”.

But builder Drake & Scull, which has been
rebounding in the past few weeks from a record low, added a
further 2.7 percent.

In Abu Dhabi, the stock index dropped 0.7 percent.
Abu Dhabi Commercial Bank, which had surged 2.5
percent on Tuesday after Goldman Sachs raised its price target
for the stock to 8.1 dirhams with a “buy” rating, fell 1.0
percent to 6.88 dirhams.

Qatar’s main benchmark fell 0.9 percent as Masraf Al
Rayan, the Islamic bank, slid 4.1 percent. The bank is
expected to post annual profit growth of between 8 and 10
percent in 2016, Chairman Hussain Ali al-Abdulla said at its
annual general meeting on Tuesday.

Salam International Investments, the most heavily
traded stock, climbed 3.6 percent.

Bahrain’s market outpaced the region, rising 1.1
percent on the back of Ahli United Bank, the country’s
biggest listed lender, which jumped 4.6 percent after it posted
an 11.1 percent increase in its fourth-quarter net attributable
profit to $118.0 million. SICO Bahrain had forecast $110.3

Egypt’s main benchmark dropped 0.8 percent to as
Palm Hills Development retreated 3.4 percent and
Global Telecom Holding lost 4.8 percent.



* The index fell 1.3 percent to 5,942 points.


* The index dropped 0.8 percent to 6,054 points.


* The index fell 1.7 percent to 3,137 points.


* The index dropped 0.7 percent to 4,282 points.


* The index fell 0.9 percent to 9,918 points.


* The index edged up 0.2 percent to 5,175 points.


* The index fell 0.5 percent to 5,404 points.


* The index rose 1.1 percent to 1,189 points.

(editing by John Stonestreet)

MIDEAST STOCKS-Oil’s retreat halts Gulf equity rally – Reuters}