Saudi stocks rise 1.2% as petchems gain strength

17/03/2016 06:57 AST

Saudi Arabia’s stock market rose on Wednesday in response to a surge in oil prices but most of the Gulf was sluggish because of profit-taking.

Egypt rallied for a third straight day after the central bank devalued the currency. In the early afternoon, Qatar said oil producers would meet in Doha on April 17 to discuss a proposal to freeze output, lifting Brent crude back above $39 a barrel.

The Saudi Tadawul All-Share Index closed 1.2 percent higher as the petrochemical sector jumped 2.4 percent in active trade.

Zain Saudi rose 3.6 percent after sources familiar with the matter told Reuters that its Kuwaiti parent Zain was narrowing the field of potential bidders for 7,000 towers owned by the Saudi firm.

Banks underperformed after Moody’s revised its outlook for Saudi Arabia’s banking system to negative from stable, saying low oil prices and lower government spending would weigh on the sector as credit risk started to rise.

National Commercial Bankedged up 0.5 percent while Banque Saudi Fransi fell 1.2 percent. “Banks will continue to remain exposed to event risk stemming from high single party exposures,” Moody’s said.

Other Gulf markets closed earlier than Saudi Arabia and did not experience as much of the oil price surge as investors continued to take profits from strong gains since mid-February. Dubai’s index fell 0.7 percent as blue chips dropped, with Emaar Properties losing 2.6 percent. Dubai Investments dropped 4.6 percent after proposing a 12 percent cash dividend for 2015; for 2014, it had paid a dividend of 12 percent cash and 6 percent bonus shares.

But eight of Dubai’s 10 most heavily traded shares rose with Arabtec, the most active, gaining 3.9 percent.

Abu Dhabi’s index fell 1.3 percent as First Gulf Bank FGB.AD slid 3.8 percent after dropping more than 9 percent on Tuesday, when it went ex-dividend. Abu Dhabi Commercial Bank fell 3.9 percent.

National Bank of Abu Dhabi outperformed, falling only 1.3 percent, after it announced a 2015 dividend of AED0.45 per share, raising this from an original proposal of AED0.40 after pressure from shareholders.

Qatar rose 0.9 percent as Qatar National Bank gained 2.0 percent, although Barwa Real Estate slid 5.5 percent as it went ex-dividend.

Kuwait’s index dropped 0.3 percent but logistics firm Agility gained 1.1 percent after saying it would be interested in bidding to manage Kuwait’s airport and ports if plans to privatise them go ahead.

Arab News