Reuters/Dubai/Cairo
UAE markets fell to fresh lows on Monday as investors dumped property stocks on concerns ahead of third-quarter earnings, while attractive valuations lifted Egypt’s shares for the fifth straight session.
High-rise buildings, developed by Sorouh Real Estate stand on Al-Reem island in Abu Dhabi in this file photo dated March 8. Sorouh dropped 3.2% yesterday. Abu Dhabi property prices may face further pressure, with 11,000 units scheduled to be handed over in the fourth quarter, according to a report by consultants Jones Lang LaSalle
Abu Dhabi’s benchmark slumped to a 30-month low, down 0.7%, and its lowest close since April 2009.
Aldar Properties fell 3.9% and Sorouh Real Estate dropped 3.2%, together accounting for more than half of trading. The two developers are expected to post results in early November.
“The momentum started gathering on Aldar and Sorouh last week on various rumours that multiple retail sellers were scared on Q3 numbers... but there’s no negative guidance (from the companies),” said Julian Bruce, EFG-Hermes director of institutional equity sales.
Abu Dhabi property prices may face further pressure, with 11,000 units scheduled to be handed over in the fourth quarter, according to a report by consultants Jones Lang LaSalle.
Dubai’s Emaar Properties also fell, down 1.2%, Air Arabia shed 0.5% and Aramex slipped 2.2%.
These stocks are usually retail investor targets.
“You have marginal activity from institutions who are more cautious and that shows today,” Bruce added. Dubai’s measure fell 0.6% to a seven month low.
Egypt’s main index extended a rally into a fifth session, up 0.8%, as foreign bargain hunters targeted battered heavyweights.
Talaat Moustafa and Ezz Steel gained 3.7% and 3.6% respectively. Orascom Construction rose 0.5% and Commercial International Bank climbed 0.9%.
“Sovereign wealth funds in Saudi and the UAE were buyers in the Egyptian market in the last couple of days and, generally, more foreigners have been in the market than in previous weeks,” said a trader at Pharos.
Banks lifted Oman’s benchmark after National Bank of Oman posted estimate-beating quarterly earnings. The index ended 0.4% higher, extending gains from Thursday’s seven-week low.
National Bank of Oman gained 1.3% after making a quarterly net profit of 10.2mn Omani rials, according to Reuters calculations.
Bank Sohar and Bank Muscat rose 1.3% and 0.8% respectively.
“With the stronger Q3 performance from banking sector majors, we expect the investors to accumulate positions at these values looking at a medium term horizon with valuations remaining attractive,” said Kanaga Sundar, Gulf Baader Capital Markets head of research.
In the kingdom, Saudi Basic Industries Corp (Sabic), the world’s largest chemical producer by market value, after market close, posted a 41% rise in its third-quarter net profit, beating analyst expectations on the back of high product prices and continued strong global demand.
Sabic fell 0.5% ahead of results and the index eased 0.05%.
The Kuwaiti market ended flat as last-minute buying lifted the index from the red.
Logistics firm Agility slipped 3.9%, as investors booked profits. The stock hit a five-month high on Thursday on speculation about a contract despite the firm denying reports that it had won a military contract worth up to $700mn.
National Industries Group Holding (NIG) fell 3.8% after saying it is looking to sell its stake in Mabanee Real Estate Co, which ended flat.
Elsewhere, Bahrain’s measure slipped 0.2% to 1,148 points.
