DOHA: Qatari stocks edged higher yesterday driven by industrials and telecom stocks. The benchmark index gained 44.08 points or 0.43 percent to finish at 10,302.80.
The daily turnover declined to QR125m with a volume of over 3 million shares from 2,219 deals. Gulf International Services jumped 2.6 percent and was the bourse’s most heavily traded stock. Powerhouse stock Industries Qatar (IQ) soared 1.63 percent.
Gulf stocks rose as local traders bought back ahead of Monday’s 2016 budget announcement. Egypt dropped in response to an interest rate hike, Reuters reported. The Saudi index closed 0.1 percent higher, rebounding from a low of 6,874 points because of rises in stocks which investors hope will be largely unaffected by the Saudi budget, due to be announced today afternoon. To narrow a huge deficit caused by low oil prices, the budget is expected to contain spending cuts, possibly including a rise in natural gas feedstock prices for petrochemical producers such as Saudi Basic Industries. The stock fell 0.6 percent.
Other stocks seen as dependent on state spending also sold off. National Shipping Co (Bahri) slumped 7.4 percent in active trade although the shipper’s board proposed more than doubling its annual cash dividend for 2015 to 2.5 riyals per share. “Bahri is a stock that is highly sensitive to the government’s spending plans,” said a Jeddah-based trader. “The stock is selling off because traders are sceptical of the transportation sector, despite the fact that the company’s earnings were strong last quarter.”
Some stocks seen as relatively immune to budget cuts were strong. National Commercial Bank edged up 0.5 percent in thin trade; it recommended paying a dividend of 0.75 riyal for the second half of 2015, up from 0.65 riyal in the second half of last year. Saudi Telecom (STC) rose 1.1 percent after the kingdom’s largest telecommunications operator offered to buy the shares in a Saudi-based sales services company, Sale Advanced Co, that it does not already own for 400 million riyals ($107m).
It was STC’s second announcement of an acquisition offer this quarter; it started buying shares of Kuwait’s VIVA on Sunday.”We believe STC’s offer to acquire the remaining stake in VIVA Kuwait reflects the company’s strategy to focus on high-growth markets,” said a note by Riyadh-based NCB Capital. Dubai’s index rose 0.8 percent, bringing its rebound from its December low to 10.8 percent. The two largest companies by market value, Emaar Properties and Emirates NBD, carried the market higher, advancing 1.1 and 1.4 percent, respectively. Abu Dhabi climbed 0.1 percent for a seventh straight session of gains. Most banks rose, with National Bank of Abu Dhabi advancing 1.8 percent.
Cairo’s index fell 0.9 percent in low volumes after the central bank raised key interest rates by 50 basis points on Thursday, citing inflationary pressures. Arab and foreign investors were net sellers, bourse data showed. The hike was a surprise to some investors and may add to concern about shaky economic growth. It will help to support the Egyptian pound, but many analysts think the pound is overvalued and will still have to be devalued at some stage.
The Peninsula / Agencies
