Dubai stocks hit 57-month high
Dubai, July 14, 2013
Dubai's shares rose to a 57-month high on Sunday as optimism on second-quarter earnings boosted buying, while foreign investors returned to lift Egypt's market.
Shares of property firms, the main sector to benefit from a recovery in economic fundamentals, led gains in Dubai.
"There will be selective accumulation on stocks that beat earning once the numbers are out," said Mohammed Ali Yasin, managing director of Abu Dhabi Financial Services. Banking sector is expected to post strong growth, which would justify higher profits for the year, he added.
Shares in builder Arabtec rose 4.2 percent, extending 2013 gains to 21 percent.
Five analysts polled by Reuters expect the firm to post a net profit average of 51.4 million dirhams ($13.99 million) for second quarter, swinging from a loss in the same period last year.
The firm had a nearly 30 percent over subscription for its $650 million rights issue earlier this month, after it extended the subscription period.
Emaar Properties and Dubai Investments Co climbed 1.9 and 7.1 percent. Dubai index rose 2 percent to its highest since November 2008. Trading volumes climbed to one-month high.
Neighbouring Abu Dhabi's measure also rose, up 0.9 percent to hit a fresh 57-month high.
UAE companies are expected to post second-quarter earning results later in July.
In Cairo, the benchmark gained 0.6 percent on upbeat sentiment as an interim government sets out plans for a civilian transition.
The market fell in three of the previous five sessions since hitting a one-month high upon the ousting of Islamist President Mohamed Mursi by the military.
"The roadmap is clear on the political front and economically," said Amr Reda, assistant vice-president, foreign sales desk at Pharos Securities. "Things are looking promising after Gulf countries provided Egypt with decent financial aid."
UAE, Saudi Arabia and Kuwait have promised $12 billion in aid packages to Egypt, which could help with fuel and grain shortages and a lack of foreign exchange reserves in the short term.
Many concerns remain, however, and the market will face renewed selling pressure should unrest escalate or if there are delays in forming a cabinet, analysts say.
A senior leader of Mursi's party called for mass rallies across Egypt on Monday, demanding their ousted president be reinstated.
Foreigners were net buyers, according to bourse data - this is a change in trend since the market's slide in June, when the market dropped on rising political tensions that culminated to Mursi's overthrow.
In Saudi Arabia, the index climbed 0.7 percent to its highest since April 2012. Petrochemical shares boosted the index with Saudi Basic Industries Corp (Sabic) climbing 1.3 percent.
The chemicals giant is expected to post a 20 percent growth in quarterly earnings, according to an average forecast of 10 analysts polled by Reuters.
Upbeat global markets also helped sentiment in the dollar-pegged country.
Stocks on major bourses posted their best weekly gains since November on Friday, helped by corporate earnings reports and remarks by Federal Reserve officials calming investor fears about US monetary policy.
SAUDI ARABIA: The index climbed 0.7 percent to 7,744 points.
QATAR: The index slipped 0.2 percent to 9,398 points.
EGYPT: The index gained 0.6 percent to 5,309 points.
DUBAI: The index rose 2 percent to 2,440 points.
ABU DHABI: The index climbed 0.9 percent to 3,738 points.
KUWAIT: The index edged up 0.01 percent to 7,883 points.
OMAN: The index gained 0.4 percent to 6,518 points.
BAHRAIN: The index slipped 0.4 percent to 1,185 points.