The main Saudi index yesterday gave up early gains and edged down 0.7% to 9,764 points as most stocks declined
Reuters/Dubai
Saudi Arabia’s stock market edged down yesterday after reports that the Saudi-led coalition fighting Houthi rebels in Yemen had deployed ground troops there, while Dubai pulled back after failing to break through major technical resistance.
The Yemen conflict has so far had no visible impact on Saudi Arabia’s economy, and it has remained within Yemen’s borders. However, it is a concern for some Gulf investors who see a risk, however small, of an escalation into a regional conflict.
The main Saudi index gave up early gains and edged down 0.7% to 9,764 points as most stocks declined. Petrochemicals giant Saudi Basic Industries (Sabic) fell 0.9% even though oil hit a new 2015 high of $66.93 per barrel on Thursday.
Middle East Paper Co surged its daily 10% limit upon listing yesterday after a heavily oversubscribed 450mn riyal ($120mn) initial public offer. Saudi Arabian share offers are usually heavily discounted, prompting stocks to surge afterwards, sometimes for several days in a row.
Dubai’s index dropped 2.3% to 4,132 points after initially inching above a strong chart barrier at its 200-day average, now at 4,244 points. Heavyweight Emaar Properties tumbled 3.6%.
After trading closed, Emaar reported a 7% increase in first-quarter net profit to 1.03bn dirhams ($280.4mn), beating the estimate of Sico Bahrain, which had expected a decline to 856.8mn dirhams.
Dubai’s index gained 20% last month as oil prices rebounded and the emirate’s banks posted better-than-expected first-quarter earnings. The benchmark has strong technical support around 4,000 points, where it peaked repeatedly between December and February.
Abu Dhabi, which largely shares its investor base with Dubai, fell 0.6%.
Kuwait’s index edged up 0.2%. Kuwait Projects Co (Kipco), the Gulf state’s largest investment company, climbed 1.5% after reporting a 17% rise in first-quarter net profit on Saturday.
Egypt’s market fell 1.3% after the country’s finance minister said on Thursday that discussions over amendments to the capital gains and dividends tax concerned only the payment mechanism.
Investors unhappy with the new levies had hoped they would be able to persuade the government to remove or change them, for example by replacing the capital gains tax with a stamp duty.
Elsewhere in the Gulf, Oman’s index inched down 0.1% to 6,318 points.
