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Jan 22 2012

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MIDEAST MORNING BRIEFING: Gulf Stocks Seen Boosted By US, Saudi Strength

Saudi SE               6464.17              +1.35% 
Dubai FM               1327.75              -0.26% 
Abu Dhabi SM           2336.98              +0.18% 
Kuwait SE              5798.50              -0.03% 
Doha SM                8461.77              -1.09% 
Muscat SM              5582.06              -0.24% 
Bahrain SE             1141.69              +0.37% 
Cairo SE               3868.44              -0.91% 
Amman                  1939.25              +0.20% 

ICE Brent $/bbl         109.86              -1.40% 
Gold $/troy oz         1664.00              +0.23% 
Euro-USD                  1.29              +0.00% 
DJIA                  12720.48              +0.80% 

 

Of ZAWYA DOW JONES

DUBAI (Zawya Dow Jones)--Stocks in the Persian Gulf region are likely to draw strength Sunday from a Wall Street rally Friday and Saudi market strength Saturday, but any substantial gains will tempered by ongoing concerns about the sovereign debt crisis in Europe.

"While immediate catastrophe may have been averted (in Europe), not least due to ECB liquidity injections, significant downside risks to global growth remain," said economists at Standard Chartered.

On Friday, the Dow Jones Industrial Average rose 96.50 points, or 0.8%, to 12720.48, ending Friday at the session high. The broad market for U.S. stocks has posted the best start to a new year in 15 years.

SAUDI ARABIA: The Tadawul market ended Saturday 1.4% higher at 6464.17.

"The market remains de-coupled from global ones as investors digest the big announcements from late last week," said one local Riyadh-based trader.

Telecom stocks chalked up gains with Etihad Etisalat, or Mobily, gaining 3.7% to SAR55.75. Analysts at NCB Capital noted Mobily last week reported stronger than expected 4Q, with revenue up 30% on the year. Mobily's net income of SAR1.7 billion was 14% ahead of NCB Capital 's number and 18% ahead of consensus, it added. Elsewhere Saudi Telecom climbed 0.6% to SAR34.20.

Shares of Kingdom Holding rose 0.5% to SAR10.10. The company run by billionaire Prince Alwaleed bin Talal, said Saturday that net profit for the fourth quarter fell 20% to SAR187.8 million, compared with the same period in 2010. It cited the impact of Middle East unrest on hotel bookings, as well as an unspecified "decrease in performance from associates".

Shares of Saudi Arabia's Mohammad al Mojil Group, or MMG, an oil and gas contracting firm, fell almost 10% Saturday after the company forecast "substantial losses" from ongoing projects that are going over budget. MMG shares closed 9.9% lower at SAR21.50.

U.A.E.: Dubai's market closed -0.3% at 1327.75 Thursday as investors used the previous session's advance as an opportunity to pocket some profits.

Shares of Dubai Financial Market , or DFM fell 3.9% to AED0.714. Morgan Stanley slashed DFM 's target price to AED0.51, from AED0.82. "Market is forecasting a faster recovery than we think realistic. 2012 will still be a trough year with depressed earnings," it said.

Elsewhere, shares of Damas tumbled 5.4% to $0.36. The jewellery and watch retailer said Thursday it signed an agreement with Tiffany & Co. to establish a joint venture that will operate the New York-based jewelry company's retail stores in the United Arab Emirates.

Abu Dhabi's market rose 0.2% at 2336.98, boosted by gains made by property-related shares.

Aldar Properties added 1.2% to AED0.82, while Eshraq Properties climbed 5.9% to AED0.18.

KUWAIT: The market closed flat at 5798.50 Thursday.

QATAR: Doha's market ended down 1.1% at 8461.77 Thursday.

Doha Bank, Qatar's fifth largest lender by market value, posted Thursday a 45% rise in fourth quarter net profit on increased lending and more customer deposits. Meanwhile the bank's top executive said the lender will sell $500 million of bonds "soon" but borrowing is too expensive now. Its shares fell 2.9% to QAR63.

Elsewhere, Vodafone Qatar, the sole competitor to incumbent operator Qatar Telecom, Thursday posted a smaller third-quarter net loss compared with the previous year as subscriber numbers jumped. Its shares closed 0.4% down at QAR7.52 before its fourth quarter earnings report was released.

BAHRAIN: The main gauge of stocks closed up 0.4% at 1141.69 Thursday.

OMAN: The market ended down 0.2% at 5582.06 Thursday.

EGYPT: The market closed 0.9% lower at 3868.44 Thursday.

Trading of the shares of Orascom Telecom Holding, or OT, and the newly split off Orascom Telecom Media and Technology Holding, or OTMT, will start Sunday on the Egyptian stock exchange, the company said in a statement late Thursday. Trading in OT shares has been suspended since Nov. 24 pending the completion of its demerger.

NEWS FROM AROUND THE GULF: Saudi Arabia's banking sector and its Kuwaiti counterpart have little or no exposure to the debt crisis in Europe, the central bank governors of both countries said Friday.

Egypt's powerful Muslim Brotherhood is prepared to support a planned $3.2 billion loan agreement with the International Monetary Fund, but wants the government first to explore alternative ways of raising revenues, according to senior officials of the Brotherhood's Freedom and Justice Party.

The final results from Egypt's six-week parliamentary election cycle were announced on Saturday, confirming predictions that the country's first post-revolutionary parliament will be dominated by a small number of Islamist parties.

Fast-growing Qatar Airways said Thursday it has identified a takeover target in Europe.

Lebanon's real economic growth is expected to have fallen to a preliminary 1.5% in 2011, from 7% in 2010 and 9% in 2009, due to the turmoil in neighbouring countries, central bank Vice Governor Saad Andary said Friday.

The euro zone's current debt problems could have a negative influence on future crude oil prices, posing a potential headache for the economies of the energy-rich Gulf Cooperation Council, or GCC, region, the head of the United Arab Emirates central bank said Thursday.

-By Tim Falconer, Dow Jones Newswires; +9714 446-1690; tim.falconer@dowjones.com

Copyright (c) 2012 Dow Jones & Co.

(END) Dow Jones Newswires

22-01-12 0448GMT