MIDEAST MORNING BRIEFING: Gulf Mkts Seen Rangebound Ahead of Eid Break

Wednesday, Aug 15, 2012


 

Saudi SE             6968.31                +0.04% 

Dubai FM             1577.61                -0.24% 

Abu Dhabi SM         2553.56                +0.26% 

Kuwait SE            5700.51                +0.20% 

Doha SM              8418.29                +0.07% 

Muscat SM            5498.74                +0.05% 

Bahrain SE           1076.44                +0.03% 

Cairo SE             5110.53                +1.27% 

Amman                1878.34                +0.15% 

 

ICE Brent $/bbl       113.50                -0.46% 

Gold $/troy oz       1603.50                +0.26% 

Euro-USD                1.23                +0.03% 

DJIA                13172.14                +0.02% 

 

   By Brinda Darasha 

   Of ZAWYA DOW JONES

DUBAI (Zawya Dow Jones)--Stocks in the Persian Gulf region are seen rangebound Wednesday as investors wind down activity ahead of the upcoming Eid holiday.

The last few corporate earnings reports for the second quarter will however provide some stock-specific direction.

Offshore leads for local markets will likely be scarce after Asian markets were slightly lower on Wednesday, while overnight the Dow Jones Industrial Average rose just 2.71 points, or less than 0.1%, to 13172.14.

Europe's ongoing debt crisis remains a key focus for investors. On Tuesday, data showed that the euro zone's $13 trillion economy is shrinking, a development that threatens to worsen a global slowdown and intensify the debate about Europe's attempts to restore confidence in the currency union.

"Key indicators of global production are pointing toward a period of slowdown in the near term and tentatively suggest some downside risks to global growth," said Barclays in a research note.

Crude oil futures dropped in early Asia trade after prices reached a fresh-three month high Tuesday as some traders book profits. September Nymex crude last traded down 38 cents at $93.05 on Globex.

U.A.E.: Dubai's market Tuesday ended -0.2% at 1577.61. Banks and real estate sectors declined.

Emaar Properties said Tuesday its revenue from condominium sales more than doubled on year in the second quarter, while sales of commercial units, plots and villas fell. Its shares closed -0.3% at AED3.46.

Arabtec Holding said Tuesday its consortium that includes Turkey's TAV Construction and Greece's Consolidated Contractors International Co., has secured the majority of bank financing for the AED10.8 billion Abu Dhabi mid-field terminal contract won in June. Arabtec shares closed -1.4% at AED2.85.

Deyaar Development on Tuesday posted a second-quarter net profit of AED18.6 million, slightly higher than a year earlier.

In Abu Dhabi, shares there closed +0.3% at 2553.56 Tuesday. Energy stocks advanced.

Dana Gas gained 2.6% to AED0.41. The oil and gas company said Monday its second-quarter net profit rose 46% on year to AED181 million as tax expenses fell.

An analyst at EFG Hermes noted that although Dana's the top line came in below expectations, "our current FY2012 earnings forecasts remain underpinned--we are looking for a net income figure of AED714 million."

Abu Dhabi National Energy Co., better known as Taqa, Tuesday said reported a 3% 2Q rise in net profit at AED447 million. Taqa shares closed +1.6% at AED1.27.

SAUDI ARABIA: Saudi's Tadawul Index closed Tuesday flat at 6968.31.

Most bank stocks closed in the red, while petchems rose inline with climbing oil prices.

The index has yet failed again to breach the 7000 mark but is expected to do so after the holiday break and as investors start to position themselves for 3Q earnings, "all economies have seasonal trends, but for Saudi Arabia these trends are more pronounced," said analysts at Jadwa Investment.

KUWAIT: The Kuwait stock exchange ended +0.2% at 5700.51 on Tuesday. Energy and telecom stocks led the advance.

Agility Tuesday posted a second-quarter net profit of KWD7.82 million, only marginally lower than its year-earlier effort as it restructured its business amid the economic slowdown. Its shares closed 2.5% higher at KWD0.405.

QATAR: Qatar's QE Index closed +0.1% at 8418.21 Tuesday. Insurance shares were mostly down.

BAHRAIN: The main gauge of stocks closed Tuesday flat at 1076.44.

OMAN: Muscat's market closed +0.1% at 5498.74 Tuesday. Most sectors closed higher.

EGYPT: The main Egyptian index of shares EGX 30 closed +1.3% at 5110.53 Tuesday, extending gains from Monday.

Investors continue to ride a wave of bullish sentiment after the dismissal of a chunk of the country's powerful military leadership.

However, Eurasia Group warned in a note that despite these moves, the Egyptian military remains powerful. "We will probably see a back and forth between the two sides in the short and medium term, where either side appears ascendant on different occasions," it said.

On the earnings front, Orascom Telecom Holding said Tuesday it swung to a second-quarter net profit of $27 million from a net loss of $58 million as it increased the number of subscribers and data usage. The net profit for the latest quarter fell short of most analyst predictions. OT shares closed up 1.1% at EGP3.65.

Commercial International Bank said its net profit in the second quarter rose 18% on year to EGP523 million as net interest income surged and Egypt's biggest lender by market value reigned in expenses. The net profit result beat the EGP481 million effort that analysts at EFG Hermes had predicted, and was also ahead of the EGP490 million penciled in by analysts at Beltone Financial.

NEWS FROM AROUND THE GULF: Annual consumer prices in Qatar rose 2.2% in July, up from 1.6% in the month earlier, underpinned by an increase in transport and communication costs, official data showed Tuesday.

Annual inflation in the United Arab Emirates rose to 0.46% in July, from 0.35% in June, driven mainly by higher food and clothing prices, the National Bureau of Statistics said in an emailed statement on Tuesday.

The World Bank will loan Egypt $200 million to support the development of small and medium-sized businesses, the ministry of finance said on Tuesday.

Saudi Arabia, the birthplace of Islam, will start the Muslim fasting month of Ramadan on Friday, along with most other Arab states.

Passenger traffic at Doha International Airport rose 22% to 8.5 million in the first five months of 2012, from 7 million in the same period a year ago, state-run Qatar News Agency reported, fueled by the growth of its national airline.

Saudi Arabia-based Arab Petroleum Investments Corp., or Apicorp, said Tuesday net profit in the second quarter surged to $20 million, compared with $2 million a year ago, helped mainly by lower costs and higher lending activities.

-By Brinda Darasha, Dow Jones Newswires; +9714 446-1688; brinda.darasha@dowjones.com; Twitter: @ZDJnews

(END) Dow Jones Newswires

15-08-12 0520GMT