MIDEAST STOCKS-Emaar dividend drags down Dubai, Saudi Electricity plunges

The Dubai stock index sank 1.6% as Emaar tumbled to its lowest level since June in heavy trade.

  
DUBAI - Weakness in Emaar Properties after news of a special dividend payment pulled down Dubai's stock market in early trade on Wednesday, while utility Saudi Electricity  plunged after it said it would pay increased revenues to the state.

The Dubai stock index .DFMGI sank 1.6 percent as Emaar tumbled to its lowest level since June in heavy trade.

Emaar said it would pay a special dividend of 4 billion dirhams ($1.1 billion) related to its listing of Emaar Development 3 billion dirhams next month and 1 billion after its annual general assembly in April.

That equates to a dividend of 0.56 dirham a share, less than the market had been expecting.

Neighbouring Abu Dhabi fell 0.4 percent despite a strong debut by the fuel distribution unit of Abu Dhabi National Oil Co after the market's first initial public offer in six years.

ADNOC Distribution opened at 2.90 dirhams against its IPO price of 2.50, and after 75 minutes was trading at 2.71. There had been concern about the debut because the initial pricing range was lowered and Emaar Development  had a weak debut in Dubai last month.

In Saudi Arabia, the index edged down 0.2 percent as Saudi Electricity plunged 9.9 percent.

The stock had climbed 3.5 percent on Tuesday in anticipation of the government announcing hikes in electricity tariffs, and after the close, the regulator revealed higher tariffs for residential users from Jan. 1.

But the company said it would pay the government a fee equivalent to the rise in tariffs, so there should be no positive impact on its profits.

The most heavily traded stock, real estate firm Dar Al Arkan, rebounded 6.5 percent after falling for two days. It has soared since mid-November, when international index compiler MSCI said it was adding the stock to its Saudi Arabia Index.

Al Tayyar Travel, whose founder has been detained in Saudi Arabia's sweeping crackdown on corruption, added 1.5 percent. The company announced a transformation plan that includes new products such as insurance and holiday activities, and boosting reservations on electronic platforms.

Qatar's index gained 1.1 percent in a broad-based rally, with advancers outnumbering decliners by 37 to one.

Late on Tuesday the government released a 2018 state budget plan that includes a 2.4 percent rise in spending. It said it expected to award 29 billion riyals ($8.0 billion) of contracts to support growth in the private sector next year, part of a drive to diversify and strengthen the economy as it faces a boycott by four other Arab states.

(Reporting by Andrew Torchia; editing by John Stonestreet) ((andrew.torchia@thomsonreuters.com)(+9715 6681 7277)(Reuters Messaging: andrew.torchia.thomsonreuters.com@reuters.net))

More From Equities