Mideast Stocks- Banks boost Saudi index; other Gulf markets down

Emirates NBD extends losses

A Saudi trader observes the stock market on monitors at Falcom stock exchange agency in Riyadh, Saudi Arabia February 7, 2018.

A Saudi trader observes the stock market on monitors at Falcom stock exchange agency in Riyadh, Saudi Arabia February 7, 2018.

REUTERS/Faisal Al Nasser

Saudi Arabia's stock market rose sharply on Sunday, lifted by cheaper valuations and a delay in Aramco's IPO, while other major Gulf markets were mostly weighed down by shares of financial institutions.

The Saudi market rose 2%, extending gains for a third straight session with all banking stocks higher. The kingdom's largest lender by assets National Commercial Bank jumped 5.3%, its biggest intraday gain since September 2018. Al Rajhi Bank closed 1,7% higher.

Akber Khan, head of asset management at Al Rayan Investment in Doha noted that before the Tadawul index began to rally last week, it had fallen almost 20% in the previous 3 months, with half of that in October alone, bring valuations for many stocks to compelling levels.

"News of a delay in the Aramco IPO removed an overhang and gave investors the confidence to start buying again" he added.

Saudi Aramco put off the planned launch of its initial public offering in the hope that pending third-quarter results will bolster investor confidence in the world's largest oil firm, Reuters reported on Friday citing two sources familiar with the matter. 

Aramco was expected to announce plans this week to float a stake of between 1% and 2% on the Tadawul, in what would have been one of the world's largest ever public offerings, worth upwards of $20 billion. 

In Egypt, the benchmark index added 0.2% with Commercial International Bank COMI.CA rising 1.4%, while Egypt Kuwait Holding was up 1.5%.

However, Egypt's Qalaa Holdings fell 0.8% despite saying that it will increase its refinery production capacity.

The firm will increase its refinery production capacity to 5.5 million tonnes of oil products per year in 2021 from 4.2 million now, the company's chairman told Reuters. 

Dubai's index extended losses from the previous session to close 0.5% down, with its largest lender Emirates NBD ENBD.DU dropping 1.2%.

On Thursday, the lender posted its biggest intraday fall in nearly eight months after its board approved a capital increase via a rights issue of up to 6.45 billion dirhams ($1.76 billion), lower than the 7.35 billion dirhams the general assembly had decided on in February this year.

The Qatari index was down 0.2% hurt by a 1.6% fall in Commercial Bank and a 1.8% drop in Mesaieed Petrochemical.

In Abu Dhabi, the index inched down 0.1% as Emirates Telecommunications and Abu Dhabi Commercial Bank lost 0.4% each.

But Sharjah Islamic Bank (SIB) rose 1.7% after it reported a rise in nine-month net profit.

($1 = 3.6730 UAE dirham)

(Reporting by Ateeq Shariff in Bengaluru; Editing by Kirsten Donovan) ((AteeqUr.Shariff@thomsonreuters.com; +918067497129;))

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