MIDEAST STOCKS-Saudi heads for second day of strong gains, Egypt up – Reuters

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DUBAI Feb 16 A recovery in oil prices coupled
with the central bank’s move to ease banking sector liquidity
this week helped lift Saudi Arabia’s stock market in early trade
on Tuesday, while stronger global bourses encouraged buying in
Egyptian shares.

Riyadh’s index was up 1.5 percent in the early
afternoon after climbing 2.8 percent at one stage. It was
heading for its second day of gains in a broad-based rally as
investors bought back stocks after the central bank lifted local
banks’ maximum loan-deposit ratio to 90 percent from 85 percent.

But the index came off its highs after Qatar, Saudi Arabia,
Russia and Venezuela agreed on Tuesday to freeze their oil
output at January levels providing other major producers
followed suit. Oil prices rose in anticipation of the
announcement and fell back slightly afterwards.

Saudi Basic Industries (SABIC), the largest
petrochemical producer, was up 3.0 percent.

The banking sector, which helped lift the main
index 2.4 percent on Monday, added a further 1.1 percent.

Dar Al Arkan fell 1.1 percent after the real
estate developer downgraded its credit rating to B1 with
negative outlook from VA3 with stable outlook.

Rehan Akbar, a Moody’s assistant vice-president, said in a
statement: “The rating downgrade and negative outlook reflect
our view of the interlinkages between the weakening operating
and macroeconomic environment that could continue to negatively
impact Dar Al Arkan.”

Egypt’s main benchmark was up 1.5 percent with
Orascom Telecom (OTMT), the most traded stock, adding
3.6 percent after gaining 3.7 percent on Monday.

Beltone Financial soared 9.9 percent, heading for
a fourth straight trading day of strong gains. The financial
firm is advising on 10 mergers and acquisitions this year worth
over 60 billion Egyptian pounds ($7.66 billion), its managing
director said on Monday, as investors seek pockets of
opportunity amid economic gloom.

But the chronic dollar shortage in Cairo, which has
underpinned foreign investors’ capital flight from the Egyptian
stock market for several months, has not improved.

The Egyptian pound weakened to 9 against the dollar on the
black market for the first time ever on Monday from 8.85 a day
earlier, as people rushed to buy the U.S. currency, two traders
told Reuters.

(Reporting by Celine Aswad; Editing by Andrew Torchia)

MIDEAST STOCKS-Saudi heads for second day of strong gains, Egypt up – Reuters}