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MIDEAST STOCKS-Egypt may extend gains; more earnings misses in Gulf
January 22, 2015 / 5:12 AM / 3 years ago

MIDEAST STOCKS-Egypt may extend gains; more earnings misses in Gulf

DUBAI, Jan 22 (Reuters) - Egypt’s bourse may rise further on Thursday after closing above a major technical resistance level, while Gulf stock markets could extend their losses as the news flow from companies has remained mostly negative.

Egypt’s stock index hit a 6-1/2-year closing high of 9,856 points on Wednesday, rising above a major chart barrier at 9,831 points, September’s multi-year peak.

A second straight close above that level would indicate the index could this year challenge the record high of 12,039 points hit in April 2008.

The plunge in oil prices has eased the pressure on Egypt’s trade balance, budget and consumer prices, allowing the central bank to cut interest rates and begin gradual exchange rate adjustments, policies that are likely to boost economic growth.

Meanwhile, Gulf companies reported another set of mostly disappointing fourth-quarter results. Saudi Arabian telecommunications operator Etihad Etisalat (Mobily) reported an unexpected fourth-quarter loss on Wednesday.

Mobily, the country’s second-biggest mobile operator and an affiliate of the United Arab Emirates’ Etisalat, made a net loss of 2.28 billion riyals ($607 million), while analysts had forecast a profit of 1.33 billion riyals.

Mobily’s competitor Zain Saudi did better and reported a reduced fourth-quarter loss of 306 million riyals; analysts had forecast the loss at 388.5 million riyals.

Dar Al Arkan, one of Saudi Arabia’s largest property developers, reported a 26.3 percent fall in fourth-quarter net profit. It made a net profit of 115.6 million riyals, missing the estimate of 139.8 million riyals.

Dubai’s Emaar Malls Group (EMG), a unit of Emaar Properties, also missed estimates slightly. The firm reported an annual profit of 1.35 billion dirhams ($368 million)in 2014, while analysts had expected 1.42 billion dirhams.

In Qatar, rating agency Moody’s changed to negative from stable the outlook on the A2 long-term issuer rating of telecommunications firm Ooredoo, saying that “profitability in Ooredoo’s core markets has been declining at a faster pace than initially expected”.

Oil prices dipped early on Thursday, ahead of an expected announcement of a bond-buying programme by the European Central Bank that could push the U.S. dollar to new highs and put downward pressure on commodities.

But the move could be positive for global equities and Asian shares held near eight-week highs on Thursday in anticipation of the announcement. (Reporting by Olzhas Auyezov; Editing by Andrew Torchia)

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