Arabtec shines; Egypt rises in slack markets

Arabtec’s shares rose after the Dubai builder swung to its first quarterly net profit since September 2014, bucking the trend in most of the region’s markets which followed global bourses and oil prices lower yesterday.
“The return to profitability (at Arabtec) is a good indicator and we believe there will be no negative surprises in the near term,” said Allen Sandeep, head of equities research at Naeem Brokerage.
Arabtec’s board approved a 1.5bn dirham rights issue on Monday and Sandeep maintained a “hold” rating on its shares until after the capital hike is completed this month, when he will reassess his recommendation.
Drake & Scull, another Dubai builder hit hard by low oil prices and austerity measures, rose 1.1%.
The Dubai index closed the day and the week almost flat.
Saudi Arabia’s index fell 0.6%, erasing all of the gains made earlier in the week, with fallers outnumbering rising stocks by 135 to 22.
National Shipping Co (Bahri) rose 0.8% after the crude oil transporter said lower commodity prices and higher bunker costs had hit its bottom line, but its fleet expansion had helped it to expand market share.
Saudia Dairy and Foodstuff Co climbed 2.2% after it reported a rise in full-year net profit, which it attributed mainly to low soft commodity costs and “careful expense management”. The board recommended an annual cash dividend of 4 riyals per share.
Saudi Airlines Catering fell 0.3% after its board recommended a cash dividend for the first quarter of 1.25 riyals, lower than the 1.75 riyals it distributed a year ago.
The company’s net profit fell 6.9% to 121.4mn riyals, while total revenue decreased 5%.
Abu Dhabi’s index added 0.8% on the back of gains in large banks, with First Abu Dhabi Bank up 1.8%.
In Egypt, the index climbed 0.8% in modest volume, with Arabian Cement rising 1.9%.
Naeem analysts said they expected weak performances at most Egyptian cement producers given a slowdown in construction activity, but Arabian Cement could be an exception due to its export business.
Elsewhere in the Gulf, Kuwait’s index fell 0.7% to 6,753 points; Bahrain’s index was flat at 1,331 points, while Oman’s index edged down 0.3% to 5,476 points.