* Petrochemical sector weighs on Saudi
* Retail shares weak on expected subsidy cuts in 2017 budget
* Egypt's OTMT slumps further as investors lack clarity
* Dubai falls below resistance at August peak
* Abu Dhabi, Qatar dragged lower by blue chips
By Celine Aswad
DUBAI, Dec 14 Stock markets in the Gulf
retreated on Wednesday in shrinking trading volumes as investors
turned cautious ahead of the U.S. interest rate hike and
guidance from the U.S. central bank expected late in the day.
Petrochemical shares, which have been dragging Saudi
Arabia's main index lower over the last two sessions,
fell further. The main index lost 0.6 percent and all but one of
the 14 listed petrochemical producers fell. PetroRabigh
dropped 3.3 percent.
Many analysts think the Saudi market's uptrend is not
reversing but stocks may take an extended breather following a
stellar performance over a six-week period which took the index
to a one-year high earlier this week.
Wednesday marked the market's second consecutive day of
shrinking trading volume. The 2017 budget, expected to be
announced late this month, looks likely to include more domestic
fuel subsidy cuts, which is prompting some investors to cash out
of domestic demand-focused shares for now.
Electronics and bookstore retailer Jarir fell 1.3
In Egypt, the main index pulled back a further 0.6
percent with selling pressure escalating in the final hour of
Losers outnumbered gainers 24 to five with Orascom Telecom
, the most heavily traded share, slumping 5.2 percent.
Shares in the conglomerate have been beaten down 20 percent
since the company said its chief executive, billionaire Najuib
Sawiris, announced early this month that he would step down.
The company did not give a reason for his departure, and
analysts said the uncertainty had hit investor sentiment hard.
"Saying they are shutting down banking operations in North
Korea and that their long-time CEO is leaving in one month's
time has left investors feeling battered," said a Cairo-based
Dubai's index fell for a second straight day,
dropping 1.2 percent to 3,584 points. It retreated below major
technical resistance on its August peak of 3,624 points.
Trading volume shrank by roughly a half from the previous
day's very large amount. Most activity focused on mid-sized
speculative shares, suggesting local short-term traders were the
main players and that foreign investors, who had been active
buyers in previous days, had pulled back.
Builder Drake & Scull, the most heavily traded
stock, fell 1.8 percent. Union Properties lost 1.7
Profit-taking also hit Abu Dhabi, dragging the index
down 0.9 percent. Telecommunications operator Etisalat
fell 1.3 percent and First Gulf Bank dropped 1.9
Qatar's main index, which had outperformed its
regional peers on Tuesday, retreated 0.4 percent. Commercial
Bank lost 3.1 percent to 32.40 riyals on the first day
of trading of its rights issue, which will end on Dec. 28. The
bank is offering new ordinary shares at 25.50 riyals each.
* The index fell 0.6 percent to 7,066 points.
* The index lost 0.6 percent to 11,317 points.
* The index fell 1.2 percent to 3,584 points.
* The index lost 0.9 percent to 4,497 points.
* The index retreated 0.4 percent to 10,359 points.
* Kuwait's index was flat at 5,672 points.
* The index was flat at 1,188 points.
* The index added 0.1 percent to 5,737 points.
(Editing by Andrew Torchia and Tom Heneghan)