Reuters, QNA/Dubai/Doha

 

Saudi Arabia’s bourse rose to a fresh 15-month high yesterday as investors bought on second-quarter earnings optimism and most other Gulf markets also rose, while Egyptian shares slipped off a one-month high.

The Saudi benchmark rose 0.6% to its highest level since April 2012 but trading volumes were thin in typical summer doldrums.

Most petrochemical shares gained, lifting the sector’s benchmark up 0.7%.

“We have an optimistic forecast for petrochemicals with expectations of growth between 15 and 20% year-on-year for the second quarter,” said Abdullah Alawi, assistant general manager and head of research at Aljazira Capital.

Alawi said Saudi Basic Industries Corp (Sabic) has underperformed and its diverse portfolio would give it a competitive edge and a larger growth potential. Shares in the world’s largest chemical producer rose 0.5%.

Riyad Bank posted estimate-beating 5.9% gain in its second-quarter net profit, helping lift sentiment across the sector. Bank shares, however, slipped 0.2%, trimming 2013 gains to 8%.

“The combination of good loan growth and lower provisions led to the good results,” NCB capital said in a note. “The read across for the other banks is that fee income is likely to be high while provisions for most banks will decline.”

In Qatar, the index slipped 0.1% to 9,363 points yesterday from the previous closing of 9,372.17 points.

The volume of shares traded was up to 5,391,593 from 2,886,433 on Thursday, while the value of shares decreased to QR174,934,487.22 from QR184,128,374.62 on Thursday.

Among the top losers were Qatar National Bank, whose share dropped 0.55% to QR161.60; Industries Qatar lost 0.25% to QR157.90; Electricity and Water fell 0.99% to QR160.50 and Doha Bank slipped down 0.63% to QR47.00.

Banking and financial sector lost 0.23 points while the insurance sector gained 0.20 points. The industrial sector dropped 0.45 points and the services sector climbed 0.71 points.

In the UAE, Dubai’s measure added 0.7%, extending 2013 gains to 40.5% but trading volumes dropped to their lowest in 11 weeks.

Abu Dhabi’s index climbed 0.5%, trading in a tight range since it edged off a 56-month peak in June.

Investors are waiting for second-quarter earnings, which will start later this month. The holy month of Ramadan, beginning mid-week, is likely to keep a damper on volumes.

“Banks in general will show strong results and higher quarter-on-quarter will encourage investors accumulate shares because they will justify higher profit for the year,” Alawi added.

The banking sector has seen a recovery in recent quarters as loan growth picks up and lenders restructure government-related debt that has been weighing on investor sentiment since the 2008 credit crunch.

In Egypt, Cairo’s benchmark retreated 0.4% to 5,312 points from a one-month high as the index faced chart-resistance and investors booked gains from a recent rally.

The market rose to 5,413 points intraday, near the June peak. An uncertain political outlook remains following the ouster of former president Mohamed Mursi as the military struggles to appoint an interim prime minister and death toll from mass protests rises. Local investors, who were buyers in the recent rally, joined foreigners as net sellers yesterday, according to exchange data.

Elsewhere, in Kuwait the index advanced 0.3% to 7,986 points, the Oman index ticked up 0.1% to 6,447 points and the Bahrain index gained 0.2% to 1,193 points.