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Middle East markets mostly rise - Daily News Egypt

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Middle East markets mostly rise

Giant construction deal lifts Abu Dhabi, Saudi banks rally on, Egypt rises on stimulus package


A $6.1bn contract awarded by Abu Dhabi state fund Aabar to Dubai’s Arabtec helped fuel a cement sector rally in Abu Dhabi but failed to offset profit-taking on Dubai’s bourse on Sunday, while banks lifted Saudi Arabia’s market.

Confirming a Reuters report on Saturday, Arabtec said on Sunday that it would build 37 towers for Aabar, which is its biggest shareholder, and become Aabar’s contractor of choice for projects around the world worth $20bn.

Arabtec’s stock rose 2.8% and another Dubai-based builder, Drake and Scull, gained 2.0%. But a 1.4% drop by heavyweight property developer Emaar dragged Dubai’s main market index down 0.4%.

Emaar might have been affected by news of the full conversion of its $500m bond into shares last week, said Ali Adou, portfolio manager at The National Investor.

“Overall, the market has to cool down, especially after the rally that we saw since the beginning of this year,” he said. Dubai’s index gained 12% in January.

Dubai’s main index closed at 3,754 points; since 23 January it has been unsuccessfully testing resistance around 3,807 points, the 50% retracement of the drop from its 2008 peak.

Abu Dhabi’s main index rose 0.4%, led by Ras Al Khaima Cement Co which on Sunday reported a 7.9m dirham ($2.2m) profit for 2013, recovering from a 7.3m dirham loss in 2012.

That, along with news of the Aabar-Arabtec deal, sparked a rally in the cement sector. Shares in Ras Al Khaima Cement surged 14.6%; Ras Al Khaima White Cement and Construction Materials, Gulf Cement, Union Cement and Sharjah Cement also rose.

Large property projects, along with construction related to the Expo 2020 world’s fair in Dubai, will “obviously impact cement prices and benefit local cement producers”, said Marwan Shurrab, fund manager and head of trading at Vision Investments.

The cement rally offset losses by Dana Gas, which on Sunday posted a 6% fall in 2013 net profit, and Union National Bank, whose fourth-quarter profit fell short of analysts’ estimates.

In Saudi Arabia, the main index rose 0.9%, led by the banking sector which continued a rally ignited last week by Riyad Bank’s proposal to double its capital by issuing bonus shares. Riyad Bank rose 2.7% to a fresh five-year high on Sunday.

Egypt’s bourse rose 0.4% after Finance Minister Ahmed Galal said the government would announce details of a fresh $4bn stimulus package within days.

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https://dailyfeed.dailynewsegypt.com/2014/02/02/middle-east-markets-mostly-rise/
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